It’s been more than a few
years here in America when our stores were invaded by two versions of plant-based meat. After the introduction of Beyond Beef and Impossible Foods, many of the conventional meat vendors tried to keep the plant based goods off grocery shelves. When that failed, they (Tyson, Smithfield, Perdue, Hormel, Nestle, among others) began devloping their own versions
Sales growth was meteoric until the waning of the pandemic. So by 2021, many of the vendors reported a drop in annual sales volume. (That would explain why Beyond Meat saw its stock price drop 80% from its peak levels- and why it’s laying off about 20% of its workforce.)
These vendors try to sell us on their products by reminding us that these foods pose less of problem for our environment (including climate change-[animal based foods are responsible for some 20% of our greenhouse gas emissions.]), doesn’t put animals at risk, etc. Not to mention the fact cutting animal consumption (beef, lamb, pork, and poultry) is better for our personal health, in addition to the environmental benefits. That’s despite the fact that meat consumption has more than doubled over the past 30 years. (339 million metric tons last year- and it is expected to grow to 374 million metric tons by the end of this decade).
Given all these benefits, why the sales slowdown?
There are a few reasons, which we’ll go over now.
Given our inflationary economy, folks are looking for ways to cut down on their growing grocery bills. And, while we would expect the plant-based alternatives to drop in price, they haven’t yet matched the price of conventional meat. (These firms are still dealing with scale-up of operations and plant expansion/startup costs.) Right now, the plant based substitutes are running about way ahead of the price of conventional meat.
Which also explains why these wares still do fairly well among religious Jews. Because our meat costs are higher what you pay. So, the plant-based alternative are either right in line with our current costs- or maybe even a scotch lower.
This next issue is kind of a cost issue, but we’ll list it separately- for now. There are WAY too many vendors, at least 60 of them accruing more than $ 500K each in sales. Which is why the scale-up costs weigh so heavily- since there is insufficient volume for each vendor to keep its costs low. (As a comparison, there are only 45 brands of plant-based milk selling at similar levels.)
The third issue is that consumers are not convinced that the health benefits of plant-based meats exist. Sure, these products are much lower in saturated fats (than conventional meat), but given the high degree of processing needed to produce the food, folks get a little nervous. Not to mention the requirement of the vendors to add vitamins, minerals, and micronutrients to their wares.
Finally, many of these vendors’ products are just “good enough”. But, their taste doesn’t fully match- or exceed- the conventional beef offerings. With the possible exception of Impossible Foods (whose annual sales did not drop in 2021), since they knew the key ingredient to ensure value for their product is synthetic hemoglobin. That is the iron based compound that helps us recognize when we are devouring a real hamburger or piece of steak. Having that ingredient (albeit synthetically created from soy) in the Impossible Foods offerings means consumers can taste the value offered.
There are more changes on the horizon. Who knows what will happen as cultured beef and fish (produced from stem cells) products are routinely available in the marketplace?
Hi Roy, A couple of things come to mind while reading this.
First, I recall a time when vegetable-based products began imitating animal-based products. Margarine started colouring their product to look like butter. That got a lot of pushback from the dairy industry to ban the sale of coloured margarine. For a period of time, Margarine packages came with a separate package of colouring power that could be added to the white product.
Second, Meat prices have been increasing to capture the profit available between the cost of the real thing and the pretenders. It seems to me that buying raw vegetables to make a meal is less expensive than buying processed “pretend-to-be” meats.
First, your margarine tails are correct. Which is why nowadays, most margarine sold is not really margaine- but a butter- margarine combination. (You can find the real margarines- Fleischmans, Mothers, and a few others) by seeking a an OU mark- which means there is no diary products within.
Secondly- the meat price rise has nothing to do with the cost or price of plant-based items; it is similar in concept and execution to the gasoline price rise- because they can, blaming the rise on supply chain issues. (Most of which were self-created by the meat industry, which refused to provide safe working environments for their staff, so worker shortages ballooned as they got sick).
finally, making your own plant-bsed hamburgers may not be as tasty (although that’s not always true) and you are substituting YOUR labor costs for those purchased. Yes, your out of pocket may be lower- if you have the time and no higher need for your effort. I say go for it- I only can make my own once or maybe twice a week, since my work efforts involve 40 to 85 hours a week.
Up to now, the plant based meats haven’t interested me that much, so I can’t speak to taste or texture (or cost). I don’t have a religious reason to eat them but I can certainly see the attraction of people who do to them. I was also a vegetarian a couple of times in my life when I was much younger, although I did eat eggs and cow/goat milk products. If I wanted to pursue that lifestyle again, I wouldn’t be reaching for cheese, egg, or cow milk alternatives. But, most of all, I know people who did try these products as true meat alternatives and none of them were impressed. I think the one good thing about the plant based meats is worker safety and conditions vs. meat processing plants. I once lived in Arkansas in a major chicken (Tyson) processing region and people with missing fingers and worse were a common sight. And yes, what these workers must have gone through during COVID.
Thanks, Alana, for that cogent addition to the conversation!