Happy Friday, and welcome to Food Fix! I’m your guest host, Lisa Keefe, editor-in-chief of Alt-Meat, the magazine and news service I co-founded in 2020 to cover the global meat analogue industry, and its sister publication, Meatingplace, which covers the conventional meat supply-chain in North America. If you think that leads to some interesting conversations about the food business, politics and culture wars – you’re right, but it keeps the job unpredictable.
Whether you’re grilling steak or veggie burgers this Fourth of July, I’d love to hear your thoughts on the market and the meat/meat substitute culture. You can reach me at lkeefe@alt-meat.net, or find me on LinkedIn.
Alright, let’s get to it –
Lisa
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Why the obits are premature for alt-meat
It’s a popular trope in food headlines – declaring the demise of the “alarming,” “bleeding” or “fad” alternative meat category. But I’m here to tell you the headlines are wrong: Just as wrong as the predictions from idealistic alt-protein entrepreneurs who five years ago declared they would soon eliminate the animal protein industry.
Some plant-based promoters still make that claim. But the destiny of the meat analogue industry rests somewhere in the vast middle of those two extremes. Alt-meat will be a part of the market, whether plant-based, fermented or even – someday – cell-cultivated. Brands will have reliable repeat customers and a few rabid fans, and meat substitutes will have a solid – but not majority – share of sales and volume in the combined meat/alt-meat market.
Some voices in the alt-protein sector have sung this tune all along, though moderate predictions aren’t sexy. The lofty forecasts (and dire predictions) have gotten far more attention. Global consultancy A.T. Kearney projected that the global alt-meat market would be worth $1.1 trillion by 2040, with alt-meats comprising 60 percent of the consumption of meat and meat substitutes combined. In 2021, Credit Suisse predicted as much as $1.1 trillion in alt-meat sales by 2050. At the same time, Bloomberg Intelligence saw a global consumer market for meat analogues of “just” $74 billion in sales in 2030, equaling 5 percent of the total conventional, alt-meat and seafood market combined.
At the time, Bloomberg’s numbers stood out for how conservative they were. But look at how they were derived: Rather than calculating a growth rate and seeing where it took the market in X years, Bloomberg researched the likely global demand for conventional meat and meat substitutes – accounting for population growth and increasing demand for protein in developing countries – and the most likely scenario for how much of that market will be served by conventional and alternative meats.
“To me, that just reinforces the fact that there is room for everybody,” Bloomberg analyst Jennifer Bartashus said at the time in an interview with Alt-Meat.
Beyond Beyond: “Room for everybody” is the sound of long-term growth. Underneath all the, ahem, mainstream media fertilizer alt-meat businesses and technologies are taking root. They have reasonable business plans, useful new technologies and a healthy understanding of the economics of a developing market.
The elephant in the room is Beyond Meat. The attention it and founder and CEO Ethan Brown have commanded has sucked the air from the room. Let’s recap:
The hype began building in mid-2018, and blew up when Beyond announced its IPO in 2019: The stock, offered at $25 a share, famously rose 163 percent in its first day, and reached an all-time high of $234.90 the following July. This stock market anomaly fueled sky-high projections for the market as a whole.
Since then, as the sector’s largest stand-alone public firm, Beyond Meat’s quarterly financial reports have been dissected by investment analysts and business journalists, laying bare its operating losses, marketing failures and looming debt load. A week ago, Beyond’s stock price was just $6.65 a share.
OK, so, Beyond was over-hyped, adding to perception of a classic boom-bust (dot-com era anyone?), but what’s left when the Beyond coverage is swept aside? A more orderly, well-worn path of expansion and consolidation in a new market, fueled by the predictable fast growth and subsequent shake-out of its start-up players.
Déjà vu all over again: I’ve been around long enough to remember that this isn’t the alternative meats industry’s first ride on the introduction-growth-maturity-decline lifecycle of a market. Interest surged in the 1980s, and several brands founded at that time – Quorn, MorningStar Farms and Boca Burgers – are still market players.
After the initial interest, however, soy and veggie burgers and the like settled into a steady, relatively small stream of sales for the following 40 years. But 21st century alt-meat companies aren’t interested in being one protein option among many – their aim is nothing short of changing the way the world eats.
So far, not so good: Dozens of alt-meat companies were launched and funded after about 2013, and they thrived on cheap money. Now, when many are facing the chasm between success in small batches and full-on, commercial-scale production, interest rates are higher than they’ve been in decades and funders are stingy. Stranded without money, companies are running aground at a rate that looks more like a bloodbath than a standard shakeout period of industrial consolidation.
All that red ink makes it harder to see the green. And there is green: Plant-based meats, for example, are faring better in restaurants than at retail, ringing up more in dollar sales ($306 million) and about the same in volume (60 million lbs.) as they were pre-pandemic. The number of foodservice-first companies is growing, including lesser-known names like Rebellyous Foods, a Seattle-based maker of plant-based “chicken” nuggets and patties, for municipal school systems and institutions; Chunk Foods, a creator of plant-based steaks and briskets, expanding within white tablecloth, independent steakhouses; and Before the Butcher, whose plant-based pepperoni sausage tops pizzas sold by chains in Chicago, Arizona, Las Vegas and L.A.
Beyond plants: Alt-meat technologies other than soy- or pea-protein-based are having a moment, also largely outside the white-hot spotlight. The Good Food Institute reported that 72 percent of the dollars invested in protein fermentation – both biomass fermentation and precision fermentation – over the last decade have been invested in the last three years alone.
There are several advantages to betting on fermentation, such as the fact that fermentation is a millennia-old technology and fermented mycoproteins (fungi related to mushrooms) have been used as a meat substitute for decades (see: Quorn). More recently introduced fermented alt-meats have found a ready market: The Better Meat Co.’s fermented mycoprotein is used in Perdue Farms’ Chicken Plus products, and the company is working with Hormel and Maple Leaf Foods (in Canada). Scottish company ENOUGH is one of 10 partners, including Cargill and Wageningen University, in the EU-funded Plenitude consortium working together to develop a closed-loop, waste-free process for creating mycoprotein products.
Growing demand: To say that demand for meat substitutes is growing is a tough sell at a time when plant-based meat sales at retail in the United States have dropped by double-digits, in volume and sales, year over year since 2020. Then again, those numbers measure only plant-based, only retail, and only in the United States.
Across the Atlantic: Elsewhere, the story is different. In Germany, per capita human consumption of conventional meat dropped by 15 percent between 2018 and 2023. For the 27 member countries of the European Union, meat consumption is projected to drop 3.6 percent by 2032, shaving 768,000 metric tons from overall consumption. Sales of meat substitutes in the EU, meanwhile, are expected to grow more than three-fold by 2028.
I’ve just returned from two weeks in The Netherlands – one week for an alt-meat conference, followed by a week-long deep dive into the veal industry – and alternatives to animal-based protein are woven into the everyday. Protein substitutes for conventional meat and dairy are abundant, even at convenience stores, and alt-protein advertising, largely on themes related to climate change, is common. One Dutch city near Amsterdam, Haarlem, now bans the advertising of conventional meat in its public spaces.
Considering that cultural trends often start in Europe before making their way to the U.S., I think I’ve seen a glimpse into the U.S. market’s future.
So save the tears, or perhaps the gloating. Alt-meats have plenty of growth pockets to pursue, even if they aren’t as easily seen by the American consumers being fed a steady diet of market obit headlines.
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What Lisa’s reading
I joined my alma mater’s virtual alumni book club and have read some books I probably wouldn’t have chosen on my own, like “By Her Own Design” by Piper Huguley and Will Schwalbe’s Ivy League memoir “We Should Not Be Friends.” Thanks to my introduction to the Libby app, I’m also borrowing ebooks from the library to catch up on great reads I missed, like Stieg Larsson’s “Millennium” series and “House of Sand and Fog” by Andre Dubus III. To me, spending a few hours with a great read is like a week at the beach.
U.S. halts avocado and mango inspections in a Mexican state after 2 USDA employees attacked, detained (CBS News). “The workers with the USDA’s Animal and Plant Health Inspection Service were recently attacked while carrying out their work inspecting avocados, and have since been released, U.S. ambassador Ken Salazar said in a statement Tuesday,” Lauren Fichten reports. “Michoacán Gov. Alfredo Ramírez Bedolla told reporters on Monday that Mexican authorities were in contact with U.S. officials and were working to resolve the situation, according to The Associated Press. In the meantime, Mexican exports were not completely blocked and the pause would not affect avocados and mangoes already in transit, according to Salazar.”
Are “ultra-processed” foods really the problem? (Slow Boring). “In practice, lots of the excessive snacking that people do consists of ‘ultra-processed’ food,” writes Matthew Yglesias, a popular blogger. “But I think this is a kind of shallow explanation – if nobody could ever eat ‘ultra-processed’ food but everything else was the same, they would overeat something else. The basic facts of human biology, human society, and market incentives would still be there.”
Democrats urge FTC to take action on junk food marketing targeting children (Senate). “We are alarmed by the proliferation of unhealthy food and beverage marketing directed towards children across online platforms. Such marketing can impact children’s food preferences, purchase requests, consumption patterns, and could ultimately contribute to unhealthy eating patterns that increase risk of chronic disease,” reads a recent letter to the FTC spearheaded by Sens. Cory Booker (D-N.J.), Richard Blumenthal (D-Conn.) and Bernie Sanders (I-Vt.) and Rep. Rosa DeLauro (D-Conn.). “The lawmakers stressed the need for heightened disclosure practices and specific guidance tailored to protect children from deceptive marketing tactics online,” according to a press release. “However, the lawmakers expressed concerns regarding the lack of clarity and enforcement surrounding endorsements directed at children, especially on platforms like TikTok and YouTube.”
Danone targets health, nutrition as food industry braces for Ozempic era (Wall Street Journal). “Danone plans to double down on health and nutrition in the coming years as food companies seek to tackle the effects of Ozempic and other blockbuster weight-loss drugs on eating habits,” reports Pierre Bertrand. “Two years into its turnaround plan, the company behind Activia yogurt and Evian water is pivoting toward acquisitions from an initial phase in which it offloaded assets it saw as underperforming. Its efforts come at a time consumers in many places around the world are ditching big brands in favor of private-label products after years of inflation.”
Dollar Tree failed to remove recalled applesauce after lead contamination, FDA says (Axios). “The recalled WanaBana apple cinnamon fruit puree pouches were linked to reports of illnesses in dozens of children last fall who were found to have ‘elevated blood lead levels,’ per a warning letter the FDA sent to Dollar Tree,” Sareen Habeshian writes. The letter said that the FDA is “concerned with Dollar Tree’s capability to quickly remove unsafe products from its store shelves as necessary and as required during a public health threat.” Dollar Tree said on Tuesday that it is “operating under a new management team and is working to strengthen compliance and enhance efforts to prevent violations.”
Have an article, podcast or book you want considered? Send to lauren@foodfix.co.
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The regular author of Food Fix, Helena Bottemiller Evich, is on maternity leave. Food Fix will feature a series of guest writers through July. In the meantime, send feedback and story ideas to editorial assistant Lauren Ng at lauren@foodfix.co.
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