2026 Perspectives in Private Equity: Food & Agriculture

This article is part of the “Perspectives in Private Equity” series.

Despite an uncertain economic and consumer backdrop throughout 2025, private equity activity in the food and agriculture sector picked up throughout the year. As we enter 2026, a number of positive market trends and a strong pipeline of sales processes set to kick off leads us to expect increased activity in the next 12 months.

Despite a cautious deal landscape for private equity last year, characterized by macro volatility around interest rates and tariffs and a shifting policy environment under the new US administration, several mega deals were done in the food space. Ferrero Group’s acquisition of WK Kellogg Co for $3.1 billion, announced in the third quarter, was a case in point. And in 2026, we’ve already seen headlines of food-related M&A transactions – such as L Catterton purchasing a majority stake in cottage cheese maker Good Culture, from Manna Tree.

Looking forward, we see several larger-cap food strategics continuing to streamline operations and carve-out non-core, lower-growth brands, creating plenty of buying opportunities for private equity. With valuations also stabilizing, we expect a busy year for deals, underpinned by a number of key market trends including the four detailed below.

A Consumer Focus on Wellness and Ingredient Transparency

Even with affordability in the spotlight, consumers are increasingly prioritizing wellness and ingredient transparency in their food buying habits, with a global pushback on ultra processed foods.

For private equity, “better-for-you” snacks remain an especially attractive market segment, including low-sugar, high-protein items. Akin recently advised Mubadala Capital and its portfolio company TruFood Manufacturing in a combination with Bar Bakers LLC, for example, a leading contract manufacturer of branded nutrition and protein bars. Another Mubadala portfolio business, Thrive Freeze Dry, has also been expanding its footprint in freeze-dried fruits, capitalizing on consumer appetite for healthier snacking.

In a similar vein, another growing vertical has been alcohol substitutes, including non-alcoholic beer, gin and tequila brands. In early 2026, food and agriculture focused investor Paine Schwartz Partners backed non-alcoholic beer business Bero, launched by British actor Tom Holland, valuing it at more than $100 million and supporting ambitious growth plans.

Meanwhile, the pushback on processed foods has impacted the previous interest in alternative proteins, a hot area of investment three years ago. Recent consumer shifts toward simpler, healthier and more “whole‑food” oriented options have contributed to reduced demand for certain ultra‑processed plant‑based meat products.  Several companies in that space, including meat substitute business Beyond Meat, have faced difficulties as declining U.S. demand, reduced retail distribution and weaker category interest have led to significant revenue and volume drops and signaled a broader recalibration of consumer preferences toward minimally processed offerings.

From a compliance standpoint, the spotlight on wellness has reinvigorated the regulatory focus on advertising claims made about the health benefits of certain foodstuffs, while the plaintiffs’ bar continues to be active in pursuing cases on that theme and is increasingly broadening its scrutiny to encompass ingredient‑transparency representations—particularly claims involving “natural,” “no artificial ingredients,” or similar statements that may conflict with the presence of synthetic acids, preservatives or other processed components.

Make America Healthy Again

The appointment of Robert F. Kennedy Jr. as Health and Human Services Secretary in the new administration has seen the rollout of a new Make America Healthy Again (MAHA) set of policies with the potential to impact capital flows.

At the start of 2026, the U.S. government issued a revamp of national dietary requirements that encourages the consumption of protein and less added sugar while advocating against highly processed foods. A new, inverted food pyramid emphasizes the need to eat more fruits, vegetables, proteins, dairy and healthy fats, forming part of a policy directive that also aims to significantly reduce ultra-processed foods in school meals, phase out synthetic food dyes and reform the Generally Recognized As Safe regulatory framework for food additives.

The administration is expected to issue new procurement regulations for schools early in the year, though implementation may take much longer given the need to reformulate menus and recalibrate supply chains. Last time such a change was made, implementation took close to a decade to finalize, making it likely the execution phase will outlast the current administration. Nevertheless, the new policy directives will strengthen already evident consumer trends driving investors towards top-of-the-pyramid healthy foodstuffs.

Beyond MAHA, the Food & Drug Administration’s Human Foods Program announced its priorities for 2026. That included a plan to reform current regulations to more effectively regulate the safety of food substances and increase transparency about substances in the food supply, as well as the creation of a new front-of-package nutrition labeling program.

At a state level, we have seen numerous states working to mirror MAHA priorities with new packaging labeling measures and restrictions on food additives. Fragmentation of the regulatory landscape at state level will undoubtedly create additional compliance challenges for private equity portfolio companies moving forward.

Akin is closely monitoring these developments and their impact on regulated industry, with particular focus on how evolving federal and state requirements may affect portfolio company operations, diligence and transaction risk.

Supply Chain Resilience

Building sustainable and resilient supply chains has been another theme underpinning private equity investment theses in food and agriculture over the past year. Regenerative farming remains a popular category within agriculture as farmers transition to organic operations and get behind cleaner alternative fertilizers and pesticides.

In January, Akin advised Paine Schwartz Partners on the sale of its portfolio company AgBiTech, which specializes in biological insect control solutions, to BASF Agricultural Solutions, by way of an example. The same client’s portfolio company HGS BioScience, a leading provider of biological crop solutions, also acquired Pharmgrade, an Idaho-based innovator specializing in microbial consortium products at the start of this year.

Outside of regenerative farming, resilient supply chains have been in focus as food and beverage companies have sought to scale up in response to demand while navigating tariffs, workforce constraints and other challenges. We are seeing private equity sponsors ramp up due diligence on food and agriculture deals as it pertains to sourcing of inputs and, where those are tariff-impacted, exploring the need for alternatives. Cargill, the meatpacking giant, announced late 2025 that it is actively addressing housing shortages for workers by investing $40 million in dedicated employee housing, a project that could yet be emulated by other industry players seeking to solidify workforce support.

Agtech

Finally, we continue to see investors looking to get behind innovation in the food and agriculture space as it pertains to agri-food tech. Whether motivated by yield enhancement, the need to address labor shortages or other efficiency gains, some of the segments attracting capital in 2025 included plant science, precision agriculture, carbon reduction and enabling technologies like AI and data automation. We certainly expect those same trends to keep gathering momentum through the year ahead.