Plant-based meat – the stuff that’s supposed to mimic the taste of meat, such as the Impossible Burger, rather than a simple tofu dog – is gaining in popularity and investor interest. IDTechEx, a research and consulting firm, projected in a recent report that the global plant-based meat market will reach $27 billion by 2030. The firm also examined some nearer-term trends that will take shape this year in the plant-based meat substitute market – including continued growth, major food company incursion, and labeling disputes.
Plant-based meat still accounts for less than 1% market share of the US meat industry, but it’s heating up. Sales grew by 40% from 2017 to 2019, and plant-based burger maker Beyond Meat saw its share price surge 500% in the three months after it went public.
IDTechEx expects sales will continue to grow in 2020, as improved product quality continues to draw in non-vegetarian/non-vegan consumers (95% of people). These consumers are less likely to compromise on quality for ethical reasons, so the R&D refinement of meat-substitute products will continue to be an important factor in sales growth.
A big factor in the rise of plant-based meat has been partnerships with fast food chains, with Burger King releasing the Impossible Burger and KFC doing a trial run of Beyond Meat chicken analogue (which sold out in half a day in Atlanta). IDTechEx predicts more fast food stores will expand their plant-based meat options in 2020.
Though only 5% of American’s are vegan or vegetarian, 54% say they want to reduce their meat consumption, with health being the top reason. Plant-based meat is viewed as a healthy alternative to meat, but with products often containing as much fat and sodium as the meat they’re replacing (especially at fast food outlets), there’s a risk of consumer backlash. As such, the report predicts that some R&D focus will switch toward making the products healthier.
Major food companies will also start to enter the plant-based meat substitute market, threatening startups like Impossible Foods and Beyond Meat, according to the report. JBS in 2019 said that it would be launching a new plant-based meat brand in Brazil, while Kroger announced the launch of a private label plant-based meat analogue under its Simple Truth brand. “In 2020, we are likely to see many established food companies launch their own plant-based meat products, which could begin the commoditization of plant-based meat,” said the IDTechEx report.
This could spell trouble for Beyond Meat, which has a perhaps unsustainable $9 billion valuation, and sells plant burgers that cost 2-3 times more than beef versions. Major companies like Kroger have more money and better distribution, and will be able to charge less for their products. This will force Beyond Meat to cut its premium prices or lose market share, either of which is bad for investors and share prices.
The report also expects the arguments around labeling to get more intense. Looking to head off competition, meat and dairy groups have been lobbying for stricter guidelines around the use of terms such as “burger,” “meat,” and “milk,” arguing that using the terms for plant-based products is either misleading or confusing to consumers.
In 2019, Missouri passed a law banning the term “burger” from being used in describing plant-based meat. Industry advocate The Good Food Institute has launched a suit against the state, arguing that the new law infringes on the First Amendment. “As we move into 2020, these arguments are set to get more intense as both the plant-based and conventional meat industries face threats to their sales,” concludes the report.
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January 08, 2020 at 06:03PM
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Plant-based meat to rise in popularity as big food firms edge into market - Consulting.us
"Meat" - Google News
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