So, is the show over? After the typical Silicon Valley and Wall street boom, the decline in sales of plant-based products as meat alternatives continues. JBS, the Meat Giant, announced last week that will close their division of Planterra. Other large corporations that had jumped on this trend are also pulling out of this market.
As with all hypes, we are now coming to a phase where there is really valid data after many startups and large corporations had picked up on this trend. There were many burger patties, minced meat or sausage products made from soy or peas, refrigerated or frozen made introduced into the mass market, in the last years, some of which raise many questions about taste. Are this products really accepted and trusted by the consumer or is there still a long way to go? And one of the most important questions is, are they really healthy?
From an economic point of view, and after a strong growth in recent years, there are many reasons for the decline in sales numbers in the US. For JBS for example, the plant-based business unit had a 4.6% decrease in year-over-year revenue in its most recent quarter. Other meat companies have struggled with revenues recently because of rising costs, inflation and supply chain issues. These still new products require massive marketing and sales investment to even get noticed. A lot of communication even only in one local market is needed to explain the consumers the benefits of a plant-based diet. The plant-based meat producers are still suffering from a perception problem. According to a study, the belief that plant-based meat is healthier and more environmentally sustainable than meat from animals is on the decline. And a possible saturation of the US market as many new brands hit the shelves could also be another reason. Being an alternative, in the current difficult times in the US, with the many, tough political battles, is also not a good starting point for a successful plant-based meat marketing campaign. Meat alternatives sold at retail fell 10.5% year-over-year in the 52 weeks ending Sept. 4.
The plant-based burgers or sausages currently established in the market are, from the point of view of vegans and vegetarians, still so-called processed food, products that are mass-produced in a factory rather than bought fresh from the farmers' market. And in a time of inflation and recession, companies are purging the not-so-lucrative product lines to focus on their core business. These are further reasons why steady growth and stability are lacking in this still very young market.
Plant-based meats can be a sustainable environmental solution and are an alternative for those who avoid meat for ethical or health reasons. They can provide important nutrients and fiber and may contain less saturated fat than meat. But they may be lower in certain nutrients such as protein, vitamin B12 or zinc than traditional meat products.
So, what is the future of plant-based meat? It will be interesting to see how consumers behave in the coming months and especially at the beginning of next year as energy and food costs rise. The trend towards a different nutritional awareness continues. And this in terms of a strong interest in the origin of the products, the exact ingredients and the processing of the products. In addition to the new startup products in the field of alternative fish products, there will continue to be an effort to produce alternative meat products in the spirit of animal welfare and as measures against climate change. The many efforts in the area of producing meat from the laboratory to obtain a marketable product from this type of production technology and the large investments in this area show that we are still at the beginning of this very important rethinking.