Dive Brief:
- Alternative proteins — derived from plants, fermentation and cell cultivation — have grown in terms of companies, investments, products and manufacturing capacity in the recent past, reports from the Good Food Institute note. On Tuesday, the think tank published three new reports about the state of each alternative protein sector.
- GFI recommends in a release about the reports that governments worldwide invest $10 billion annually in research and development and commercialization for alternative proteins.
- Alternative proteins have been touted as a potential solution for many problems in the food space, such as creating a sustainable and stable food supply and enhancing nutrition.
Dive Insight:
These three GFI reports build a case aimed at investors, governments, companies and skeptics about why the alternative protein industry is worth their attention and money and offer ways to improve customer engagement.
“The growth opportunities for this nascent industry are significant,” Caroline Bushnell, vice president of corporate engagement at GFI, said in the release. “With further investment and continued innovation to improve the taste and affordability of products, the industry will accelerate and be poised to capture sizable market share.”
The report dedicated to the plant-based industry concludes that plant-based meat is a significant growth opportunity for U.S. and global retail and foodservice. Globally, retail sales of plant-based meat in 2022 were $6.1 billion, according to Euromonitor statistics in the GFI report.
Last year, U.S. sales of plant-based meat were down 1.2%, and individual unit sales fell by 8.2%, according to statistics from SPINS and reported by GFI and the Plant Based Foods Association. The U.S. numbers are not unexpected; many plant-based meat companies experienced difficulties last year and saw their growth stagnate. A September 2022 study from Deloitte found the number of consumers who sometimes bought plant-based meat — 47% of all consumers — decreased 3% in a year.
Overall, the SPINS statistics showed, U.S. plant-based sales increased last year, with a 6.6% bump across all categories.
While there aren’t as many products derived from fermentation on the consumer market, the nascent industry is booming.
There are currently 136 fermentation companies in 31 countries, GFI found. These include both biomass fermentation companies, which make animal derived analogs from fungi, and ones using precision fermentation, which creates animal-free proteins identical to those in dairy and eggs through fermentation.
More than half — 57% — were founded in the last three years, and 15 started in 2022. There are currently 17 known company-owned facilities to make fermented alternative proteins worldwide, establishing infrastructure to scale up.
The only cultivated meat product available to consumers is Eat Just’s Good Meat chicken in Singapore. However, Eat Just’s U.S. operations and Upside Foods both recently received FDA clearance for cultivated chicken products in the United States.
There are currently 156 cultivated meat companies worldwide, located in 26 different countries, according to GFI. And there are 27 planned or operational facilities to make cultivated meat that are at pilot scale or larger — including Believer Meats’ under-construction facility in North Carolina and Good Meat’s in-progress new facility in Singapore.
Investments in the alternative protein space were down last year, with $2.9 billion raised — less than 2021’s $5.1 billion and 2020’s $3.2 billion. However, an investment report that GFI put together earlier this year found 87% of active investors in the sector plan to put money toward alternative protein companies or funds in 2023. Several Big Food and Big Meat players — including Nestlé, Kraft Heinz and Cargill — have been active investors, partners and acquirers of alternative protein companies, the think tank’s report states.
Countries including Canada — which added another $150 million Canadian ($111.6 million) investment to the Protein Industries Canada innovation organization in February — and Singapore — which has invested more than $114 million Singapore ($85.8 million) in alternative proteins over the years — have long supported alternative proteins. Other countries, including Israel and China have made these new food options central to food policy.
The U.S. has started to show interest in bolstering the alternative proteins sector, with its recently issued “bold goals” to use biotechnology to strengthen the food system.
