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A new report by New York-based market intelligence firm CB Insights is predicting a major tumble for the conventional meat industry. According to analysts, big meat is not just facing massive immediate losses amid the coronavirus pandemic, but also challenged by the rise of alternative protein sources, from plant-based to cultivated meats, seafood and dairy, which could bring on major disruption to the US$2.7 trillion global meat market.
The report, titled Our Meatless Future: How The $2.7T Global Meat Market Gets Disrupted, explores how the current animal meat industry will face inevitable shifts due to the rise of alternative protein, which analysts say could drive a future where “protein isn’t dominated by conventional meat sources”.
While the researchers acknowledge that animal meat remains “king” and represents 30% of the calories consumed globally, shifting consumer behaviour that has been accelerated by the coronavirus pandemic and mass viral outbreaks that have upended the meat supply chain means that big meat could be facing losses of more than US$20 billion in 2020 alone.
At the same time, food techs that are focused on plant-based proteins have experienced surging sales and attracted millions in investment despite the economic downturn induced by the pandemic. Analysts cited the soaring demand for vegan meat in recent months, especially in the U.S. where sales were still up by 264% in the 9 weeks ending May 2, following the 280% increase recorded in March in the early days of the pandemic in the country.
Traditional meat distribution channels were and remain upended, as restaurants, schools, and other facilities closed. Declining output and rising prices left consumers with fewer options, and plant-based meat alternatives began to see a lift.CB Insights
With the pandemic exposing the vulnerabilities in the complex global meat supply chain, which involves farms, feedlots, processing facilities, storage centres and slaughterhouses, researchers say that alternative protein sources represent a clear solution to dramatically simplify the meat supply chain.
Supply chain concerns also represent only the latest of a slew of issues that consumers have become aware of, in particular concerns related to ethical stewardship and environmental sustainability.
“Traditional meat distribution channels were and remain upended, as restaurants, schools, and other facilities closed. Declining output and rising prices left consumers with fewer options, and plant-based meat alternatives began to see a lift,” said the CB Insights report.
“Meatless consumption could also alleviate ethical questions around meat consumption, as the meat industry has long been subject to ethical concerns behind meat production practices.”
An indication of mass demand for plant-based meat, even large meat corporations have begun shifting their strategies, highlighted the report. Specifically, CB Insights pointed out that the world’s biggest meat company, JBS, launched its own brand of meatless protein called Ozo in June this year, joining the ranks of other major meatpackers who have also developed plant-based alternatives, such as Tyson, Smithfield, Hormel, and Cargill.
Meatless consumption could also alleviate ethical questions around meat consumption, as the meat industry has long been subject to ethical concerns behind meat production practices.CB Insights
Further driving the move away from conventional protein sources is the innovation coming from alternative protein startups, who researchers say are now creating substitutes across almost every category, from prepared and frozen meats to different types of proteins, such as seafood, eggs, dairy, meal substitutes, supplements and snacks.
Although plant-based alternatives have so far caused the most disruption to the meat industry, the report says that lab-grown or cultivated meat, as well as insect protein, which though more sustainable are not considered cruelty-free, vegan-friendly or animal-free, will also help accelerate the shift to alternative protein sources.
Looking ahead, the main challenges that food techs will face are cost and scale when it comes to “moving these products from novelty purchases to kitchen staples”.
Lead image courtesy of Drew Angerer / Getty Images.