The vegetable meat industry is on the rise, but challenges remain

SINGAPORE – Demand for meat alternatives has grown and will continue to rise, but the industry still has hurdles to overcome in various parts of the world, analysts said.

According to Google Trends, global search interest for the term ‘plant-based meat’ skyrocketed in early 2019, months before Beyond Meat’s IPO.

The global meat substitutes industry is worth $ 20.7 billion and is expected to grow to $ 23.2 billion by 2024, market research firm Euromonitor told CNBC.

That growth is fueled by concerns ranging from animal welfare to food security and the Covid-19 pandemic.

“In this era of shocks and instability, building a low-risk value chain means focusing on where the opportunities are, and the shift to plant-based meat shows no signs of slowing down,” said Elaine Siu, CEO of The Good Food. Asia-Pacific Institute.

But obstacles to the fast-growing market remain.

The plant-based meat market in Asia may be constrained by established perception issues, Siu said.

For example, mock meat or vegetarian meat was previously mainly eaten by Buddhist followers in China, she said.

“Replication of the flavor and texture of meat has never been pushed beyond a relatively basic level,” she said, adding that these traditional products serve a specific purpose and that “their appeal is considered limited to certain groups.

“In order for plant-based meat to exploit its full market potential in Asia, the industry must continue to break away from its association with traditional fake meat, which is expected to be sold at a low price and carry historic pictorial baggage”. said Siu.

Livestock farmers could also stand in the way of the alternative protein sector, especially in the US, said Simon Powell, global head of thematic research at US bank Jefferies.

The US Cattlemen’s Association filed a petition in 2018 asking for an official definition of the terms “beef” and “meat”, in an effort to keep vegetable proteins out of the description.

“The established producers are going to lobby their governments hard to change the labeling, to mess around with consumer advertising to say you can’t call it meat,” Powell told CNBC via Zoom. “I think that is potentially one of the biggest obstacles.”

In October, the European Union rejected proposals to ban restaurants and shops from using words like sausage or hamburger when describing meat alternatives.

Powell added that if any of the plant-based meat companies had “some sort of accident” or problem with their recipe that results in a “massive recall,” customers could become afraid to eat these alternatives.

“This is a big ‘if’ … but if they had a major product recall, it could hurt consumer confidence,” he said. “At some point, you will get these events. That will bring the industry back a little bit.”

Separately, Powell said the ‘Instagrammability’ of plant foods is one of the reasons the market is growing ‘all over the world’. Market growth could be stunted if the novelty of meat alternatives fades or disappears, he said.