News

Plant-based meat gets “a reality check”

James Nason, 10/10/2022

Sales of plant-based “meat” in the United States are stagnating.

Several factors are responsible for the trend, according to economic analysis firm Deloitte, including that the “addressable market may be more limited than many thought”.

Click on image to enlarge

Data from Deloitte’s latest Future of Fresh survey shows that the portion of the US population open to trying and repeat buying may have “already have reached a saturation point”.

The number of consumers who sometimes buy what the survey refers to as “Plant-based alternative meat” or PBA for themselves or a household member did not grow in 2022.

“The half (53%) who aren’t buying it may not be easily reachable, partly due to cultural resistance to a product some view as “woke.”

“Others, many of whom say they want to reduce their red meat consumption, still aren’t interested in PBA meat.”

The Deloitte report also suggests that with inflation, fewer people are willing to pay a price premium for the products, which are yet to achieve price-parity with real meat.

Additionally, consumers are also now “questioning the assumed benefits” of plant based meat alternatives, Deloitte points out.

“Even buyers of PBA meat are changing their views on some of its attributes. The biggest change is in health perceptions.

“Many early adopters believed that the health benefits of plants would apply to all food products made from plants. Last year, almost seven in 10 consumers (68%) who had purchased PBA meat believed it was healthier than animal meat.

“But some of these consumers are changing their minds, as this year, the number dropped by 8 percentage points. A similar but smaller drop occurred with environmental sustainability, down 5 percentage points.”

While consumer interest lags, investment in plant-based protein from global venture capital and major consumer brands has still continued to grow in 2022, the report notes.

Early predictions of massive growth for plant-based protein alternatives underpinned the investment pitch, but commercial sales results are now providing a reality check.

In 2020, Deloitte Access Economics released a report commissioned by Food Frontier, a voice for manufacturers of alternative meat products, describing the growth of plant-based meats in Australia as “unstoppable”.

In another challenging sign for the product category, a researcher has looked into the financial statements of 100-plant based meat brands in Europe, the US, Canada, Australia and New Zealand.

He found that “not one was showing any sign of making a profit, even after five or more years in business”.

“And those with the fastest-growing sales also had the fastest-growing losses,” Julian Mellentin, head of market trends consultancy New Nutrition Business, said.

In his view plant-based meat brands are making “every mistake in the failures handbook”, including forgetting that taste and texture matters most, jumping straight to mass and “over-estimating the size of the opportunity”.

 

HAVE YOUR SAY

Your email address will not be published.

Your comment will not appear until it has been moderated.
Contributions that contravene our Comments Policy will not be published.

Comments

  1. Jeff, 11/10/2022

    “Plant based” the description in its self is misleading , therefore illegal. (Section 18 of the ACL, used to be Trade Practices Act)
    What are genuine red meat producers feeding their livestock ??.
    Using natural green simple products, sunlight x grasses, cereals, browse and h2o, to manufacture 110% PROTEIN in four legged factory’s !.
    Not out of test tubes using undisclosed muck, which should be described as such.

Get Beef Central's news headlines emailed to you -
FREE!