Why Food Waste Has Become a Business Opportunity

Food waste is no longer viewed only as a disposal problem. It is increasingly becoming a feedstock for compost producers, anaerobic digestion operators, organics recyclers, waste management companies, and circular-economy startups.

The scale of the problem explains why. The UNEP Food Waste Index Report 2024 estimated that the world wasted 1.05 billion tonnes of food in 2022, with households, food service, and retail all contributing to the total. That waste represents lost food value, wasted agricultural inputs, avoidable disposal costs, and a major climate challenge.

In the United States, food waste is also one of the most important materials in the landfill system. The EPA says food waste makes up about 24% of municipal solid waste disposed of in landfills, and because it decomposes quickly, it is responsible for an estimated 58% of fugitive methane emissions from municipal solid waste landfills.

This has created a clear commercial opening: companies that can collect food waste, separate it from packaging, process it safely, and turn it into saleable products can serve both waste generators and end markets. Their customers include supermarkets, restaurants, food manufacturers, municipalities, farms, landscapers, utilities, and corporate sustainability teams.

How Food Waste Becomes Fertilizer, Compost, and Soil Products

The food waste recovery value chain usually starts with collection. Restaurants, grocery stores, food manufacturers, households, schools, and municipalities separate organic material from general waste. That material is then transported to a composting site, anaerobic digestion facility, depackaging plant, or integrated organics recycling facility.

At the facility, companies usually follow several steps:

  1. Inspection and Sorting: Incoming food waste is checked for plastic, glass, metal, and other contaminants.

  2. Depackaging: Packaged food, such as expired grocery items or damaged retail products, is mechanically separated from its packaging.

  3. Processing: The organic material is composted, digested anaerobically, blended into soil products, or converted through insect bioconversion.

  4. Product Creation: Outputs can include compost, potting soil, soil amendments, digestate, liquid biofertilizer, animal bedding, renewable natural gas, electricity, or insect frass.

  5. End-Market Distribution: Finished products are sold or applied in agriculture, landscaping, horticulture, municipal soil programs, renewable energy markets, or sustainability-linked procurement contracts.

This is where the business model becomes attractive. Food waste companies can earn revenue from the front end through collection fees or processing contracts, and from the back end through compost sales, fertilizer products, renewable natural gas, carbon-related value streams, or sustainability services.

Composting, Anaerobic Digestion, Depackaging, and Nutrient Recovery

Food waste recovery is not one single process. Different companies use different technologies depending on the type of feedstock, local regulations, energy markets, land availability, contamination levels, and customer needs.

Composting

Composting is an aerobic process, meaning it requires oxygen. Food scraps are typically mixed with carbon-rich materials such as yard waste, wood chips, leaves, or agricultural residues. Microorganisms break down the material into compost, which can improve soil structure, water retention, microbial activity, and nutrient availability.

Composting companies usually make money through collection services, municipal contracts, tipping fees, and the sale of compost, mulch, soil blends, or landscaping products.

Anaerobic Digestion

Anaerobic digestion breaks down organic material in sealed, oxygen-free tanks. It produces biogas, which can be used for electricity, heat, or upgraded into renewable natural gas. It also produces digestate, a nutrient-rich by-product that can be used as fertilizer or soil improver when properly treated and regulated. The EPA defines anaerobic digestion as the breakdown of organic material by microorganisms in the absence of oxygen.

This model is especially attractive when food waste is wet, energy markets are supportive, and there is demand for renewable gas or low-carbon fuels.

Depackaging

Depackaging is the mechanical separation of food from its packaging. It is especially important for grocery stores, food distributors, manufacturers, and retailers because much of their food waste is still wrapped, bottled, boxed, or sealed.

Depackaging allows companies to recover the organic fraction while removing plastic, cardboard, metal, and other non-organic materials. The separated food slurry can then be composted, digested, converted into animal feed ingredients, or used in other recycling pathways.

Nutrient Recovery

Nutrient recovery focuses on capturing the fertilizer value of organic waste. This can include compost, liquid digestate, solid digestate, concentrated fertilizer products, insect frass, or treated soil amendments. The core idea is simple: food waste contains nutrients that originally came from soil, fertilizers, water, and agricultural systems. Recovery companies aim to return part of that value back to farmland, gardens, landscaping, and horticulture.

Denali: Turning Grocery Waste Into Compost and Potting Soil

Denali is one of the most visible U.S. companies in food waste recycling and organics recovery. The company works across the food supply chain, including grocery stores, food manufacturers, healthcare facilities, and other commercial waste generators.

Its model combines collection, depackaging, processing, and product creation. Denali’s Zero Depack technology helps separate unsalable or packaged food from packaging, making it easier to recycle food that would otherwise be difficult to process.

In 2024, Denali announced ReCirculate, a compost and organic potting soil product made from food waste sourced from grocery stores. The company said the product would be available in U.S. retail stores beginning in January 2025. The business logic is powerful: a grocery store’s unsalable food can become a soil product that may eventually be sold back through retail channels.

Denali also reported that it recycled more than 14 billion pounds of organic materials in 2024, including more than 2 billion pounds of food waste. The company positioned this as a major contribution to U.S. food waste recycling capacity.

Its role in the market is important because Denali is not just a compost producer. It is an infrastructure operator connecting retailers, waste streams, depackaging technology, soil products, and circular-economy claims.

Republic Services: Recycling Organics Into Soil Amendments

Republic Services is one of the largest waste and recycling companies in the United States, and organics recycling is part of its broader sustainability strategy.

The company says it operates 20 organics recycling facilities and recycles about 2 billion pounds of organic waste into soil amendments that can be used by commercial farms and community gardens. Republic also notes that it uses anaerobic digestion for some organics recycling, turning waste into renewable energy.

Republic’s business model is built on scale. It already has customer relationships, collection routes, municipal contracts, transfer assets, and waste processing expertise. That allows the company to add organics recycling as a specialized service where regulations or customer demand support it.

For food waste generators, Republic can provide organics carts, collection, hauling, processing, and compliance support. For the circular economy, its main contribution is infrastructure: moving organic waste out of the landfill stream and into composting, soil amendment, or energy-producing pathways.

WM: Converting Food Waste Into Engineered Bioslurry

WM, formerly Waste Management, has developed food waste recycling capabilities through its CORe program. The CORe process takes pre-consumer and post-consumer food waste and converts it into an engineered bioslurry that can be used for co-digestion at municipal wastewater treatment plants.

This model is different from traditional composting. Instead of turning food scraps directly into finished compost, WM processes the material into a pumpable organic feedstock. Wastewater treatment plants can then use anaerobic digesters to create biogas while managing the remaining digestate through existing treatment systems.

Industry coverage has described WM’s patented CORe process as a way to recycle food waste into EBS, a high-quality engineered bioslurry used for co-digestion in municipal wastewater treatment plant anaerobic digesters.

The advantage of this model is that it uses existing wastewater infrastructure. It can also help cities and commercial customers comply with organic waste diversion rules without requiring every food waste generator to send material directly to a composting site.

Vanguard Renewables: Food Waste, Dairy Farms, and Renewable Natural Gas

Vanguard Renewables is a major U.S. anaerobic digestion company focused on turning food and dairy waste into renewable natural gas. Its model is built around farm-based digesters that combine food and beverage waste with dairy manure.

The company’s facilities produce renewable natural gas, while digestate can be returned to farms as a nutrient-rich material. This creates a circular relationship between food companies, farms, energy markets, and soil management.

Vanguard describes itself as a national leader in food and dairy waste-to-renewable energy projects and has announced plans to expand its network of anaerobic digestion facilities.

In 2025, the American Biogas Council reported that Vanguard opened an anaerobic digestion and depackaging facility at Dinnerbell Farms in Wisconsin. The facility is designed to process food and beverage waste, including packaged and unpackaged material, into renewable natural gas, liquid digestate for land application, and animal bedding.

Vanguard’s business model is a good example of how food waste recovery can move beyond compost. The company earns value from waste processing, renewable gas production, farm partnerships, and corporate sustainability demand from food and beverage companies.

Divert: Food Waste Prevention, Recovery, and Energy

Divert is a circular-economy company focused on reducing wasted food and converting unavoidable food waste into useful outputs. The company’s model combines data, logistics, food donation, and organics recycling.

Divert positions its model around “Prevent, Provide, Power.” That means it helps customers prevent waste through data and technology, recover edible food where possible, and process unavoidable food waste into renewable energy.

For large retailers and food businesses, this is valuable because food waste is not only an environmental issue. It is also a margin issue. Spoiled, unsold, or expired inventory represents lost revenue, supply chain inefficiency, disposal cost, and reputational risk.

Divert’s role in the fertilizer and nutrient recovery space comes mainly through the organic material that remains after edible food recovery. That material can be processed through anaerobic digestion or other organics recovery pathways, creating energy and nutrient-rich by-products instead of landfill methane.

Generate Upcycle: Organics Recycling for RNG and Fertilizer

Generate Upcycle is another company focused on transforming organic waste into renewable natural gas, electricity, and fertilizer products. The company works with businesses and municipalities to recycle food and agricultural waste through anaerobic digestion.

Generate Upcycle states that its anaerobic digestion systems convert organic waste into renewable natural gas, electricity, and fertilizer rich in nutrients.

Its model sits at the intersection of waste management and energy infrastructure. Food waste suppliers pay for responsible organics recycling, while the company can generate value from energy outputs and fertilizer-related by-products.

This kind of platform is becoming more relevant as municipalities look for landfill diversion options and corporations look for measurable ways to reduce waste-linked emissions.

Atlas Organics: Compost, Soil Blends, and Mulch

Atlas Organics focuses on converting food and yard waste into compost, soil blends, and mulch. The company serves businesses and municipalities, making it part of the composting infrastructure that supports local and regional circular economies.

Circular Services announced in 2025 that it acquired Atlas Organics, describing the company as a business that transforms food and yard waste from businesses and municipalities into compost, soil blends, and mulch used to grow more food and greenery.

Atlas Organics represents the traditional but still essential side of the market: composting infrastructure. Unlike anaerobic digestion companies that often emphasize energy, composting companies emphasize soil health, nutrient cycling, landscaping markets, and municipal organics diversion.

CompostNow: Household and Business Food Scrap Collection

CompostNow operates in the collection and composting segment, serving households and businesses that want to divert food scraps from landfill. Its model is service-oriented: customers subscribe to or pay for food scrap pickup, and the collected material is composted into a soil product.

The company describes its service as a way to keep food scraps out of the landfill and turn them into nutritious garden compost.

CompostNow is important because it shows how smaller-scale and urban organics recovery businesses can create consumer-facing circular economy services. The company’s value is not only in processing waste, but also in customer education, participation, and behavior change.

For cities and households, the challenge is often not the composting science itself. It is making separation easy, keeping contamination low, and building enough trust that customers consistently use the service.

BTS Bioenergy: Anaerobic Digestion and Soil Products

Bioenergy DevCo, now operating as BTS Bioenergy, is active in anaerobic digestion infrastructure. The company uses organic waste to produce renewable natural gas and nutrient-rich soil products.

The American Biogas Council reported in 2025 that Bioenergy DevCo changed its name to BTS Bioenergy and described the company as transforming organic waste into renewable natural gas and nutrient-rich soil products through anaerobic digestion.

This company fits the growing infrastructure-led model of food waste recovery. Rather than focusing only on collection or compost sales, BTS Bioenergy develops and operates digestion systems that can serve utilities, governments, and energy buyers while recovering nutrients from organic material.

ReFood: Food Waste Collection, Anaerobic Digestion, and Fertilizer

ReFood, part of SARIA, is a major European food waste recycling company. It operates anaerobic digestion facilities designed specifically for food waste diverted from landfill.

ReFood UK says its end-to-end process converts food waste into renewable energy and nutrient-rich fertilizer. Its fertilizer product, ReGrow, is certified to PAS110 standards, meaning it must meet recognized requirements for digestate quality and agricultural use.

ReFood’s model is vertically integrated. It provides food waste collection, secure recycling, anaerobic digestion, energy production, and fertilizer output. This makes it especially relevant for food businesses that need a reliable disposal alternative and a sustainability story they can communicate to customers.

Severn Trent Green Power: Food Waste to Biofertilizer and Green Energy

Severn Trent Green Power is one of the UK’s largest food waste-to-energy operators. The company uses anaerobic digestion to convert food waste and crops into green gas, electricity, and biofertilizer.

The company says it transforms food waste and crop material into renewable energy and valuable by-products such as biofertilizer for agriculture. It also operates green waste facilities that produce compost products used by farmers.

Severn Trent Water has also stated that its food waste and green waste recycling business is the UK’s largest producer of renewable energy from food waste. One of its plants can process up to 50,000 tonnes of food waste into 18,000 MWh of energy per year, while producing biofertilizer for farmland.

This illustrates the mature UK model: food waste collection is increasingly tied to anaerobic digestion, renewable power, biomethane, and regulated digestate application on agricultural land.

Convertus: Large-Scale Organics Processing in Canada

Convertus is a major Canadian organics processor that designs, builds, operates, and services organic waste treatment facilities. Its model includes composting, biodrying, and anaerobic digestion.

The company describes composting as a process that turns food waste into valuable fertilizer and says its advanced technology converts municipal and business organic waste into agricultural compost, fertilizer, and/or refuse-derived fuels.

At its Ottawa Organic Waste Treatment Facility, Convertus says it can process up to 150,000 tonnes per year and converts household organics into agricultural fertilizer and other useful outputs.

Convertus shows how municipal organics programs can become long-term infrastructure contracts. Its customers are not only restaurants or retailers, but cities and regions that need dependable treatment capacity for household green bin programs.

Better Origin and Insect Bioconversion

Better Origin represents a different approach to food waste recovery: insect bioconversion. Instead of composting or anaerobic digestion, the company uses black soldier fly larvae to convert organic waste into agricultural inputs.

EIT Food describes Better Origin as a company that transforms food waste into sustainable agricultural inputs using black soldier fly larvae, producing aquaculture feed and organic fertilizer.

This model creates multiple outputs. The larvae become protein and fat for animal feed, while the leftover frass can be used as an organic fertilizer or soil amendment. Insect systems are especially interesting because they can process certain food waste streams quickly and generate higher-value products than bulk compost in some markets.

However, the model depends heavily on regulation. In many countries, rules restrict what insects can be fed and which animal markets can use insect-derived protein. That makes market development more complex than traditional composting.

Veolia and Industrial Bioconversion

Veolia has explored insect bioconversion as part of its broader waste recovery services. The company describes the use of insects to transform organic waste from agricultural and agri-food industries into animal feed and fertilizer. It also identifies frass as a natural organic fertilizer rich in macronutrients such as nitrogen and potassium.

Veolia’s involvement matters because large environmental services companies can help industrialize newer bioconversion models. They bring customer networks, waste handling expertise, permitting experience, and access to large food and agricultural clients.

The Waste Lab: A Dubai-Based Food Scrap Recovery Example

The Waste Lab is a Dubai-based startup focused on food scrap recovery and soil building. The company describes itself as a women-owned, impact-driven startup aiming to create an opportunity for every food scrap to become a solution rather than a burden.

Its role is especially relevant in urban markets where landfill diversion, education, and local soil-building solutions are still developing. Companies like The Waste Lab show how food waste recovery can be localized through community engagement, composting services, and partnerships with households, businesses, and farms.

For markets such as the UAE, the challenge is different from regions with large backyard composting cultures or established municipal green bin systems. High-density urban living, climate conditions, contamination control, and customer awareness all shape the economics of food scrap recovery.

How These Companies Make Money

The companies transforming food waste into fertilizer and soil products usually rely on several revenue streams rather than one.

1. Collection Fees

Many companies charge households, restaurants, grocery stores, food manufacturers, or municipalities to collect separated organic waste. This is similar to traditional waste hauling, but with specialized containers, routes, contamination rules, and reporting.

2. Processing Contracts

Municipalities and commercial waste generators may pay companies to process organic waste at composting, digestion, or depackaging facilities. These contracts can create stable recurring revenue when supported by regulation.

3. Tipping Fees

Like landfill operators, organics processors may charge a fee per tonne of material received. If landfill disposal becomes more expensive or restricted, composting and digestion facilities become more competitive.

4. Compost and Soil Product Sales

Compost producers sell finished compost, soil blends, mulch, potting soil, and agricultural soil amendments to farmers, landscapers, retailers, municipalities, and consumers.

Denali’s ReCirculate product is a good example of food waste being converted into a branded retail soil product.

5. Renewable Natural Gas and Electricity

Anaerobic digestion companies generate biogas. That biogas can be used to make electricity and heat or upgraded into renewable natural gas. Companies such as Vanguard Renewables, Generate Upcycle, ReFood, Severn Trent Green Power, and BTS Bioenergy are all active in this energy-linked model.

6. Fertilizer and Digestate Products

Digestate can be used as a biofertilizer when it meets quality and regulatory requirements. ReFood’s ReGrow and Severn Trent Green Power’s biofertilizer model show how anaerobic digestion companies can generate agricultural value beyond energy.

7. Sustainability Services and Data

Companies such as Divert also generate value by helping food retailers and businesses measure, reduce, and report food waste. This turns waste management into a data and sustainability service, not just a hauling activity.

Why the Market Matters for Agriculture and the Circular Economy

Food waste recovery matters because it connects several economic and environmental priorities.

First, it diverts organic material from landfills, where food waste is a major methane source. Methane reduction is one of the strongest arguments for investing in organics recovery infrastructure because food waste decomposes quickly and contributes heavily to landfill gas emissions.

Second, it supports soil health. Compost and digestate can return organic matter and nutrients to agricultural land, gardens, and landscaping systems. The FAO notes that biofertilizer can add nutrients, maintain soil fertility, and support sustainable food production.

Third, it creates a circular-economy loop. Food waste originates from agricultural production, food processing, retail, restaurants, and households. When companies recover that material and return nutrients to the soil, they reduce the one-way flow from farm to landfill.

Fourth, it can reduce reliance on synthetic fertilizers in some applications. Compost and digestate do not replace all mineral fertilizer needs, but they can improve soil organic matter and supply nutrients as part of a broader fertility strategy.

Fifth, it creates local infrastructure and jobs. Composting sites, digestion plants, depackaging systems, collection routes, and soil product businesses are place-based operations. They can support local waste diversion goals while serving farms, landscapers, and municipalities.

The Operational Challenges Holding the Market Back

Despite its potential, food waste recovery is difficult to scale.

Contamination

Plastic, glass, metal, utensils, packaging, and non-compostable materials can reduce product quality. Contamination increases sorting costs, damages equipment, and can make compost or digestate harder to market.

Logistics

Food waste is heavy, wet, and often odorous. Collection requires careful route planning, leak-proof containers, timely pickup, and processing facilities close enough to make transportation economical.

Regulation

Rules differ by region. Some markets require food waste diversion; others do not. Digestate and compost must often meet quality standards before being applied to land. Insect bioconversion faces especially complex feed and animal-feed regulations.

Product Quality

Compost, soil amendments, and digestate must be consistent, safe, and trusted by farmers and landscapers. Poor-quality products can damage market confidence and reduce willingness to pay.

End-Market Demand

Even if companies can process food waste, they still need buyers for compost, soil blends, digestate, fertilizer products, or renewable gas. The economics depend on strong end markets.

Customer Education

Households, restaurants, and employees need to know what goes into the organics bin. If customers sort incorrectly, the entire recovery chain becomes more expensive.

Capital Intensity

Anaerobic digestion plants, depackaging lines, composting facilities, and renewable natural gas upgrading systems require significant capital. Companies must secure long-term feedstock supply and offtake agreements to justify investment.

The Companies Defining the Next Phase of Food Waste Recovery

The food waste-to-fertilizer market is not dominated by one type of company. It includes large waste haulers, composting specialists, anaerobic digestion developers, retail-focused recyclers, municipal infrastructure operators, and insect bioconversion startups.

Denali is building a national organics recovery platform around depackaging, food waste collection, compost, and retail soil products. Republic Services and WM are using their waste infrastructure to expand organics diversion. Vanguard Renewables, Generate Upcycle, BTS Bioenergy, ReFood, and Severn Trent Green Power are turning food waste into renewable gas, electricity, and digestate-based fertilizer. Atlas Organics, CompostNow, Convertus, and The Waste Lab show how composting and soil-building models can work at regional, municipal, household, or urban scale. Better Origin and Veolia demonstrate how insect bioconversion can turn food waste into animal feed and organic fertilizer.

The market’s central insight is clear: food waste recovery works best when it is not treated as charity or waste disposal alone. It becomes scalable when companies can build commercial systems around collection, processing, compliance, energy, fertilizer, soil health, and sustainability reporting.

That is why the most important companies in this space are not simply “composting food scraps.” They are building the infrastructure for a more circular food system—one where nutrients move from plate waste, expired inventory, and food processing by-products back into farms, soils, gardens, energy systems, and commercial supply chains.

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