The plant-based protein trend is growing faster than expected by most people.
Last week, Beyond Meat, which makes meatless alternatives to beef, pork and poultry, went public. Its main competitor Impossible Foods reported that the demand is so great that it comes to a shortage. Burger King announced plans to launch an Impossible burger nationwide, and Ikea said it is developing a meatless meatball that tastes like animal meat.
"It definitely has a speed never before seen," said Dewey Warner, research analyst at market research firm Euromonitor International. Warner examines developments in the food sector.
The demand for plant-based meat alternatives is fueled by consumers who want to make their diet healthier and reduce their impact on the environment. And there is definitely room for growth. The question is, how much?
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Beyond had a very successful first trading day on Thursday, up 163% from its $ 25 initial public offering price. The stock closed at nearly $ 67 per share on Friday.
Meanwhile, Impossible Foods, the main competitor of Beyond, has found so much interest that it runs out of product. Impossible CFO David Lee told CNN Business that Impossible's demand for meatless protein has more than doubled in the approximately 7,000 restaurants it serves. In addition, Impossible is more than twice the number of restaurants it serves: This week, Burger King announced it will launch a version of its Whoppers with an Impossible patty at its approximately 7,300 stores nationwide.
Other chains like White Castle, Carls Jr., Bareburger, Qdoba and others also have Beyond Meat or Impossible Foods on their menu. Beyond Meat can be bought in supermarkets such as Safeway or Kroger, and Impossible plans to sell in retail outlets this year.
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Even Ikea jumps on the trend. The furniture retailer, known for its Swedish meatballs, said on Thursday that next year he will test a new version of his classic meatballs, which should taste just like meat.
For Impossible, the question a year ago, "How fast will the market develop?" Said David Lee, CFO of the company, this week to CNN Business. "Well, it's clear:" How quickly can we create more capacity to meet this huge demand?
Driving the Trend
Veganism and vegetarianism have been particularly appealing to those concerned with animal welfare, Warner told the Euromonitor analyst, as concerns about climate change and health prompt a larger group of people He added that a rethinking of how much meat they consume.
That's why the growth of plant protein products designed to mimic the taste and appearance of meat has increased over the past ten years, he said especially in the last five years.
Beyond, which started about ten years ago, saw strong demand in 2017 and 2018, CEO Ethan Brown told CNN Business.
"Consumers are" so fast entered this category "because it provides information on the adverse effects of processed red meat on health and the environment" b ombardiert ". A few years ago, in 2015, the World Health Organization linked the consumption of processed meat to cancer, naming red meat as likely to cause cancer.
There was so much interest that Beyond had to redesign its supply chain and production processes to make sure it could compete.
Companies such as Beyond Meat and Impossible Foods underscore the environmental and health benefits of reducing meat consumption when marketing their products. Two of the four stated goals of Beyond Meat are to stem climate change and protect natural resources. The others should improve the health of humans and animals.
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Likewise, Impossible argues that "Animal husbandry occupies nearly half of Earth's earth, consumes a quarter of our freshwater, and destroys our ecosystem." The mission is to "save the best planet in the known universe" while ensuring that people still enjoy the experience of eating meat.
While people eat less meat, fast-food chains like Burger King name their meat-eaten herbal products. Burger King, for example, said it was about meat lovers who wanted to make their diet more varied with the Impossible Whopper test instead of vegans or vegetarians.
Where it's going
It seems like the plant-based trend is here to stay.
"In the food industry, there are many flash-in-the-pan things that are growing fast," said Warner. However, growth in the vegetable meat alternatives area is accelerating, he said, suggesting that this is "more than just a fad. This could have some endurance. "
There is also growth in parts of the sector – such as vegetable alternatives to seafood – that are not yet mainstream.
Brown, in turn, sees" unlimited "growth potential for his business." As the industry grows more attractive "We're ready," he said.
In a Securities and Exchange Commission that presented detailed plans for the company's initial public offer, over the course of time Beyond Meat predicted that the meat market in the US could reach $ 35 billion This is an ambitious goal: Euromonitor International has a more modest forecast for a $ 2.5 billion retail meat substitute market in the United States.
In its filing, Beyond Meat reported net sales of $ 16 billion $ 2 million in 2016 had risen to $ 87.9 million last year, with Beyond Meat losing in the past year In addition, $ 29.9 million was attributable to investments in "Innovation and Growth in our Business". The company added that it would continue to invest in innovation, supply chains, production and marketing.
And there are latent threats to the industry, such as consumers' preference for simple, natural foods with few ingredients. Beyond Meat mainly consists of water, pea protein and oil, as well as more than a dozen other ingredients. "Impossible Foods" uses soy-based protein.
Those looking for healthy ingredients may shy away from these products and create potential headwinds in the industry, Warner said.