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The future of alternative proteins: Implications for the meat industry and farmland use
Alternative proteins products that are direct substitutes for animal-based protein (meat & dairy) are valued at US$29.4 billion from primary markets in North America, Europe and Asia. The currently popular and growing plant-based food categories are plant-based dairy and meat at 10-15% and 1-2% of total global protein markets, respectively. The market is growing, and the main drivers of this growth include:
- Growth driven by the increasing number of flexitarians, a niche demographic that substitutes meat products for plant-based on certain days for health or environmental reasons.
- New consumer trials in plant-based products in the past few years.
- Growth in sales driven by smart retail strategies such as product placement with animal-based meats, proper signage and merchandising strategies.
- Market externalities such as income levels drives the growth as they remain at premium prices.
- Environmental awareness is causing shifts in consumer behavior and consequently the demand for products with lower carbon emissions such as plant-based meat is increasing.
- Current market disruptions such as COVID-19 impacted the animal-based meat supply chain, causing shortages. Due to this, a higher growth in plant-based sales is noted.
- Investment strategies by key players in the market through fundraising, partnerships, acquisitions or introducing their own product line. The key players vary from food and agricultural companies to non-profit organizations and financial institutions looking for climate-friendly investments.
- Partnerships between plant-based protein companies such as Beyond Meat and Impossible Foods with large food retailors is driving up the reach to mass audience and driving up the supply.
IHS Markit has developed an extensive study of this increasingly important topic: The future of alternative proteins: Implications for the meat industry and farmland use.
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