Investors are baying for a bite of fake meat, seasoned with a dash of old-school capitalism, a pinch of market savvy and a touch of moral purity. Alternative, lab-grown, plant-based, in vitro or whatever meat title is the choice of the hour, world demand for meat alternatives is expected to hit $5.8 billion by 2026, according to Transparency Market Research.
Big money has attracted big players such as ADM, Cargill and Tyson Foods. Two years ago, Tyson Foods, the $38-billion protein behemoth, launched Tyson Ventures, committing $150 million to invest in partnerships with various food startups focused on sustainability and technology.
“I can’t express enough that we do see a world where there will be multiple types of protein products available,” Tyson’s chief sustainability officer Justin Whitmore said in the Chicago Tribune in April. “That could include [plant]-based protein next to pork, next to maybe lab-grown protein, and consumers will have a choice.”
Cargill also sees alternative proteins as a choice for consumers and has invested in Memphis Meats, a startup developing technology to grow meat from self-reproducing animal cells. According to the company, the investment allows them a seat at the meatless-meat table, so it can have a voice in the space and perhaps influence the messaging.
As industry players develop meatless-meat alternatives, what does that mean to farmers? “We will eventually see a shift in the kinds of crops grown—but that won’t be abrupt,” says Matt Ball, senior media relations specialist with the Good Food Institute. “Peas and pulses will become more important [for plant-based proteins], and I’m not sure what will be used with clean meat.”
Clean meat, also referred to as lab-grown meat, requires carbohydrates, proteins and vitamins just like its traditional livestock counterpart. But, at what combination and level of production it needs is unknown—still a trade secret in this evolving field.
Meat consumption is climbing across the globe and is projected to continue a sharp rise in conjunction with a world population on pace for 9.6 billion by 2050.
Ultimately, alternative meat might be a complement, but not a substitution, to the overall meat market. Dan Hale, Extension meat specialist at Texas A&M University, believes alternative meat demand will ascend in tandem with real meat demand: “Both industries can maintain and grow. There is a younger generation trying new foods for a mixed bag of reasons and the reality is they don’t always have big loyalty to meat products.
“More retail outlets and hamburger chains are going to offer alternatives, but again, as an addition, not a substitute,” Hale adds. “When McDonald’s first offered salads that changed the dynamic, but it didn’t affect the core. I expect we could see the same situation with alternatives.”
Despite alternative meat’s growth, Derrell Peel, Extension livestock marketing specialist at Oklahoma State University, believes alternative meat will settle in the same market share arena as natural, organic, local or grass-fed products. “The specialty meat categories are viable and grow so fast in percentage terms, but always have a ceiling. I think the same general pattern will follow with substitute meat.”
Peel sees alternative meat drivers bookended by capitalism and ideology. “If burger chains perceive customer interest, they’ll make sure alternatives are there for a complete menu. On the flip side, ideology drives alternatives as well, and that includes everything from animal rights to environmentalism. Long-term, I see alternatives in a niche-based category,” Peel says.
While lab-grown meat is not yet commercially available, the plant-based foods market is growing rapidly—up 20% this year, according to research by Nielsen and the Plant Based Foods Association, with plant-based meat substitutes growing at 24%. That compares to an increase of 2% for all foods sold in the same categories. The plant-based foods category are those that directly replace animal products, including meat, seafood, eggs and dairy. Plant-based meat substitutes topped $670 million in sales this past year.
Whether alternative proteins become a mainstay in the meat case will be determined by how well they meet the taste, texture and nutrition profiles consumers demand. “Replicating a burger and steak are two different worlds. Flavor and texture in steak represent a steep, steep hill to climb,” explains Brandi Karisch, Extension beef cattle specialist at Mississippi State University.
Dietary hurdles are why Jude Capper, a United Kingdom-based livestock sustainability consultant, believes it is “unlikely” a “whole-scale shift” will occur from meat to plant/lab-based proteins.
“An increasing proportion of people are adopting plant-based diets, but although the relative increase may look significant, it is still a very small percentage of the total population—1.7% in the UK, for example,” Capper says. “The vast majority of people are still choosing animal products. Having other products available is great, but it is only adding to dietary diversity, not replacing it.”
Oregon feedlot owner Dave Maag agrees. “I think they [alternative proteins] will become a small segment of the market. A certain group of consumers will like those products, just like they like our natural beef.”
Maag refers to his 7,000-head Maag Feedlot Inc., which custom finishes cattle for the Painted Hills Natural Beef Program, a 20-year-old entity founded by seven ranch families.
“When we started, Painted Hills was harvesting 60 head every other week,” he says. “Now we’re harvesting 600 head every week, so the natural niche has grown, but I think it’s still only 3% or 4% of the market.”
Alternative meat companies, however, have their sights set on a much bigger market share. Beyond Meat, the plant-based burger startup, is now sold in 19,000 U.S. stores.
The success of alternative proteins relies on product attributes they claim can’t be matched by traditional meat: the elimination of the undesirables associated with animal farming. Those undesirables, either real or perceived, include the environmental footprint of meat production and animal welfare. Because animals are not slaughtered to produce lab or cultured proteins, they’re often referred to as “clean meat.” In other words, the entrepreneurs behind alternative proteins are baking as much warm and fuzzy marketing into their products as they are taste and texture.
Hale says the message toe-tagged to alternatives often maligns the traditional meat industry. “The biggest threat arrives when people claim alternatives are more environmentally friendly or healthier,” he says. “The information is often false and based on personal world views regarding the use of animal products for food and fiber.”
For instance, Memphis Meats’ stated mission is to replace traditional meat with products harvested from cells instead of animals.
“The way conventional meat is produced today creates challenges for the environment, animal welfare and human health. These are problems that everyone wants to solve,” says Uma Valeti, co-founder and CEO of Memphis Meats. His company has drawn financial backing from Bill Gates and Richard Branson, in addition to Tyson and Cargill.
The potential of alternative proteins is a concern of many in the livestock industry. Minnesota cattleman Don Schiefelbein believes alternative proteins should serve to convince beef, and all livestock and poultry, producers to further raise the bar on quality.
“Alternative proteins have the potential to disrupt our industry,” he says bluntly. “But how much of a disruption will be up to those of us in the beef industry.”
Peel agrees. “My ability as a futurist is poor, but I don’t think alternative meat will take away a big chunk of the current meat market. I think it will have legitimate market share, just like the specialty meats of today. I keep a simple view: If people want something that tastes like a burger, in the end they’ll go buy a real burger.”
Meatless Meat Brings Changes, Opportunities to Row Crop Farmers
While a shift toward plant-based and lab-grown proteins might be concerning for livestock producers, it could provide new opportunities for row crop farmers. As interest in alternative proteins increases, types of crops grown across the U.S. could change.
“I think the livestock market will continue to grow for a while because U.S. per capita meat consumption is at an all-time high and meat consumption is soaring in Asian countries and others the U.S. exports to,” says Matt Ball, senior media relations specialist with the Good Food Institute. “So, I think the impact of clean meat and plant-based meat won’t be felt by farmers in the short term.”
Food industry veteran, Michael Horsch, of Horsch Manufacturing, says U.S. consumer preferences could start to mimic those in Europe. This would call for fewer pesticides and greater organic production.
His team is beginning to design specialized equipment for organic farmers to meet this trend. “Probably the future is organic farming with glyphosate,” Horsch quips, then adds. “I’m only raising questions. I’m not saying that this is the answer.”
Perhaps proving consumers’ preferences for organic, Beyond Meat, a large manufacturer of plant-based meats, recently won non-GMO certification. They use unique proteins beyond just the traditional wheat and soybeans of the past, such as pea proteins.
In his travels, he’s seeing shifts in consumer eating preferences, which only confirms a movement toward more plant-based proteins.
“They are flexitarians,” Horsch says. “The flexitarian movement is the biggest movement in the history of human diet change.”
Instead of looking to traditional protein sources such as hamburgers, consumers are reaching for fewer red meats and more vegetables and a little chicken, he says.
If predictions come true, farmers might need to change their crop mixes and get used to a new way of production, such as organic. While farmers prepare for the future of food, “the first question is, what are we going to eat in the future?” Horsch says. —Sonja Begemann and Nate Birt