When it comes to alternative protein, we’ve come a long way in the past decade. Seven years ago, a cultured meat burger was about $ 275,000 to make, Beyond Meat hadn’t sold a single burger, and the alternative meat market today was less than a tenth its size.
Since then, consumer awareness of the environmental impacts of conventional animal husbandry has increased significantly. At the same time, entrepreneurship, innovation and capital have resulted in significant quality improvements in alternative meat products, and this combination of increased environmental awareness and better products has laid the foundation for a multitude of emerging alternative proteins to compete for a growing share of the trillion-dollar world market for meat.
The growth of the alternative protein market enables today’s consumer to make purchasing decisions based on a wider range of factors ranging from taste, affordability and convenience to nutritional differentiation, animal treatment, environmental footprint and other factors pass.
The meat supply of the future will become more and more heterogeneous
Whether traditional, vegetable, mushroom-based or cultivated, each meat source offers the consumer and the supply chain its unique advantages, and each plays a role in the supply chain of the future.
The preferences of meat consumers are becoming more and more diverse and the meat range of the future will be more and more heterogeneous. It is generally accepted that taste and cost have the greatest influence on food purchase decisions. Studies show that between 60 and 90% of consumers rate them as the most important factors.
However, factors such as environmental pollution and diet are rapidly catching up and have taken leadership positions among certain consumer segments. Consider a 2020 study from the International Journal of Behavioral Nutrition and Physical Activity of adults ages 18-30 that identified diet as the most important influence on choice and another Kearney study from 2020, which states that more than 80% of consumers consider the environment when making purchasing decisions.
Regardless of which factors are considered to be most important, there is now a strong consensus that diet and the environment make a significant contribution to the decision to buy food.
Also, keep in mind that opinions vary widely when it comes to what constitutes proper nutrition, what prices are affordable, and how best to support a healthy environment. Step into a growing spectrum of alternative meats that enable a diverse consumer with diverse preferences to tailor their meat purchase decisions to those individual preferences.
The next wave of herbal offerings promises real diet differentiation
Traditional animal-based meatIs still the undisputed king with a current market share of well over 90%. For consumers who view taste as the main factor in their meat purchase, traditional meat is likely to remain a leading choice as long as alternative meat producers are primarily aimed at mimicking the traditional meat experience. However, for this growing group of consumers seeking a varied diet and an environmental focus, the relative value of traditional meat will wane.
The vegetableConsumers have experienced rapid quality improvements over the past decade and can now buy products that offer a pleasant experience with a significant reduction in environmental impact and resource consumption.
While this category promises improved nutrition, a significant part of its nutritional differentiation relies on eliminating perceived negatives (e.g., the next wave of herbal offerings promises real dietary differentiation to meet the needs of younger consumers who over diet put other factors.
Similar, mushroom-basedMeat offers the potential for a significantly reduced environmental footprint and the promise of improved nutritional properties, while providing a pleasurable experience that is similar to that of traditional meat.
Note that in the case of mushroom-based meats, there is the potential for organoleptic and nutritional differentiation beyond what can be achieved with traditional animal-based or currently scaled plant-based meats. Of the 2 million known mushroom species, less than 5% have been used in scaled-up applications. This is a large white room that is being tapped.
Adaptation of cell-cultured meat
Although not yet commercialized in the US, cultured meat, Sometimes referred to as pulp, and products that are a combination of cultured and vegetable or mushroom-based could offer the greatest flexibility with the least compromise for the consumer and the environment.
If the focus is on taste, cultured meat enables the consumer to experience the real thing and the associated experience, but without concentrated animal husbandry and with a massive reduction in resource consumption.
Cultured products also allow optimization of nutritional factors, including fats (saturated and omega-3s) and cholesterol, and products made with a combination of cultured and vegetable or mushrooms allow for even greater nutritional diversification.
Lower feed conversion ratio
Perhaps most important from an environmental point of view is the resource intensity impact resulting from the scaling of alternative meat products.
Each of these alternatives will have a significantly lower feed conversion ratio than conventional animal-based meat. For beef with a feed conversion rate of 4 to 8 pounds of feed required to produce each pound of meat, alternatives bring that number closer to 1.
If these alternatives combined reach a hypothetical 30% market share in the United States over time, the resulting efficiency could eliminate 30 to 50 billion pounds of feed and free up an agricultural landmass roughly the size of Massachusetts. This land use efficiency, combined with a reduction in CO2 emissions and water consumption by more than 80%, undoubtedly make alternative meats an extremely compelling environmental story.
Mushroom-based space shows promise, but it is in its early stages and requires significant infrastructure investments to scale
We have a long way to go and we still have a long way to go. As consumers begin to internalize the environmental impact of traditional farming, the real “cost” of traditional meat is likely to rise in consumers’ minds.
As a result, the traditional supply chain must continue to innovate in terms of taste, nutrition, affordability and mission to attract the sustainability-minded consumer. There are significant advances in taste and consumer experience to be made in the herbal product space, and real nutritional differentiation is likely to require simpler ingredient lists and a more focused approach to improved nutrition rather than simple meat substitutes.
The mushroom-based area shows promise, but is at an early stage and requires significant investment in scale infrastructure (keep in mind that liquid fermentation may need more emphasis if mushroom-based solutions are to reach true industrial scale).
Likewise, cultured meat technologies are only now beginning to reach commercial viability in terms of price and scalability. There is reason to be optimistic in this market, and Today’s announcement from Future Meat Technologiesthe construction of a functioning farmed meat plant is an important milestone in the commercialization of this technology.
The future meat supply chain is exciting and varied, with animal, vegetable, mushroom-based and cultured meat playing a role. Consumers seem to agree; up to 95% of alternative meat buyers also buy traditional meat. With continued entrepreneurship, innovation and capital, consumers and the environment can enjoy a growing cake with multiple meaningful parts.
Matthew Walker is the managing director at S2G company, A multi-tier venture fund that makes start-up, risk and growth phase investments in sustainable food and agriculture companies. Portfolio CompaniesCell culture meat companies Future Meat Technologies, edible trays co Apeel Sciences, plant-based dairy company Ripple Foods, and HPP baby food co Once Upon a Farm.