Darling Ingredients: A Symbiotic Play on Sustainability and Circular Economies

The BMO Global Farm to Market Conference on May 14, 2025, will spotlight Darling Ingredients Inc. (NYSE: DAR), a company uniquely positioned at the intersection of environmental stewardship and industrial innovation. As global investors gather in New York City, the firm’s participation—through institutional meetings and a fireside chat—offers a critical moment to assess its role in the evolving sustainability-driven economy.

The Circular Economy’s Silent Giant

Darling Ingredients is often overlooked in mainstream investment narratives, but its operations are foundational to the global circular economy. The company processes an estimated 15% of the world’s animal agricultural by-products across 260 facilities in over 15 countries, transforming what would otherwise be waste into high-value products like collagen, gelatin, and renewable energy. This vertical integration allows it to capture 30% of the global collagen supply, a key input for pharmaceuticals, food supplements, and cosmetics.

The firm’s renewable energy output is equally notable. By converting organic waste into biogas and other forms of energy, Darling reduces landfill dependency while meeting rising demand for green power. This dual focus on waste reduction and value creation aligns with ESG (environmental, social, governance) trends that are reshaping investor priorities.

Market Dynamics and Tailwinds

Darling’s business model benefits from three converging trends:
1. Regulatory Pressure: Governments worldwide are tightening waste management rules, incentivizing companies to adopt circular practices.
2. Consumer Demand: The health and wellness sectors are driving growth in collagen-based products, with the global collagen market projected to reach $9.4 billion by 2030 (MarketsandMarkets).
3. Energy Transition: Renewable energy adoption is accelerating, and Darling’s biogas production complements broader decarbonization goals.

Risks and Considerations

While Darling’s positioning is compelling, investors must weigh risks. Commodity price volatility—particularly in feed ingredients and energy—can impact margins. Additionally, regulatory changes or shifts in trade policies could disrupt supply chains. The company’s heavy capital intensity also requires sustained reinvestment to maintain scale.

Conclusion: A Sustained Growth Narrative

Darling Ingredients’ participation in the BMO conference underscores its strategic importance in a world increasingly focused on sustainability. With a 15% global share of animal by-product processing and a 30% stake in collagen production, the firm operates in niche, high-margin markets with limited direct competition. Its renewable energy output further diversifies its revenue streams, providing resilience against cyclical downturns.

Financially, Darling’s consistent cash flow generation and balance sheet strength—$1.2 billion in revenue in 2023 with a 12% operating margin—support its long-term growth ambitions. While short-term volatility is possible, the company’s role in solving global waste and energy challenges positions it as a beneficiary of secular trends.

For investors seeking exposure to the circular economy, Darling Ingredients presents a compelling opportunity to align with a company that turns waste into wealth—both literally and figuratively. The upcoming conference is a pivotal moment to evaluate whether this undervalued gem deserves a place in growth-oriented portfolios.

Data as of 2023. Projections based on third-party analyses and historical trends.