The plant-based meat industry has grown into a $20 billion business — but challenges remain

SINGAPORE — Demand for meat options has grown and can proceed to rise, but the industry nonetheless has hurdles to beat in several elements of the world, analysts mentioned.

Worldwide search curiosity for the time period “plant-based meat” skyrocketed in early 2019 months earlier than Beyond Meat’s preliminary public providing, in keeping with Google Trends.

The world meat substitutes sector is value $20.7 billion, and is about to develop to $23.2 billion by 2024, market analysis firm Euromonitor instructed CNBC.

That progress is being spurred by considerations starting from animal welfare to meals safety 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 towards plant-based meat shows no signs of slowing down,” mentioned Elaine Siu, managing director of The Good Food Institute Asia Pacific.

But obstacles remain for the burgeoning market.

The plant-based meat market in Asia could also be restricted by established notion points, mentioned Siu.

For instance, mock meat or vegetarian meat was beforehand primarily eaten by followers of Buddhism in China, she mentioned.

“Replication of the taste and texture of meat was never pushed past a relatively basic level,” she mentioned, including that these conventional merchandise serve a particular objective and “their appeal is viewed as limited” to sure teams.

“In order for plant-based meat to reach its full market potential in Asia, the sector must continue to break free of its association with traditional mock meats, which are expected to be sold at a low price point and carry historical image baggage,” mentioned Siu.

Cattle farmers might additionally stand in the way in which of the choice protein sector, particularly within the U.S., mentioned Simon Powell, world head of thematic analysis at American financial institution Jefferies.

The U.S. Cattlemen’s Association in 2018 filed a petition asking for an official definition of the phrases “beef” and “meat,” in a bid to maintain plant-based proteins out of the outline.

“Incumbent producers are going to lobby their governments hard to change the labelling, to mess around with consumer advertising to say you can’t call it meat,” Powell instructed CNBC through Zoom. “I think that’s potentially one of the biggest barriers.”

The European Union in October rejected proposals to ban eating places and retailers from utilizing phrases comparable to sausage or burger when describing meat options.

Powell added that if any of the plant-based meat firms had “some kind of accident” or drawback with their recipe that ends in a “massive recall,” that might make prospects afraid of consuming these options.

“This is a big ‘if’ … but if they were to have a big recall of product, then that might dent consumer confidence,” he mentioned. “At some point, you’re going to get these events. That’s going to set the industry back a bit.”

Separately, Powell mentioned the “Instagrammability” of plant-based meals is one motive why the market is rising “everywhere in the world.” Growth of the market could possibly be hindered if the novelty of meat options fades away or wears off, he mentioned.