HUNTIN' DAYLIGHT -- MARKET FOR FAKE MEAT REAL BUT SMALL

by: Wes Ishmael

Stomach-churning as it is to meat lovers and those who favor authenticity, fake meat products are catching the buying attention of at least a few consumers.

In fact, according to a study released by Research and Markets (R&M) this summer, the global meat substitute market size was valued at $4,175 million in 2017, and is expected to reach $7,549 million by 2025. That would make for a compound annual growth rate (CAGR) of 7.7 percent from 2018 to 2025.

“The alternative protein category is sure to grow over the next decade as global protein demand expands, allowing pathways for more diversified protein products,” according to a report from CoBank earlier this year (Lab-Grown Cultured Meat-A Long Road to Market Acceptance). “Euromonitor International projects sales of meat substitutes to rise steadily to $863 million in 2021, representing roughly 17 percent growth compared to 2017 estimates. These figures are dwarfed in comparison to the current retail market size of $49 billion in sales for the entire meat and poultry category in the U.S.”

Although fake meat products cultured from animal cells dominate recent headlines (see below), fake meat products built with plant protein dominate the market currently.

“The meat substitute market by product type comprises products prepared from tofu, tempeh, textured vegetable protein, seitan, quorn, and other plant-based sources,” according to the R&M report. “Textured vegetable protein (TVP)-based meat substitutes occupied the largest market share of 35.8 percent in 2017 as it is the basic ingredient in most of the soy-based meat substitute products. In terms of growth, seitan-based meat substitutes are projected to exhibit an impressive CAGR of 9.4 percent, owing to increase in adoption in the food service industry.”

Lots of that was Greek to me, too. For the record: tofu—also known as bean curd—is made from coagulated soymilk; tempeh is made from fermented soybeans; sietan is wheat gluten; quorn is a mycoprotein fermented from fungus. Best as I can tell, rather than an umbrella encompassing those other products, TVP—also known as soymeat—is a product unto itself, made from defatted soy flour.

How's your appetite now?

Meat by Any Other Name

Whether built from plant protein or cultured from animal cells, using the term ‘meat' is misleading, of course. Just like using the term ‘milk' when describing liquid alternatives derived from soybeans, almonds and all of the rest.

Adding to confusion is the fact that these terms have been attached to other things previously, without ridicule. For instance, I don't remember ever hearing anyone raise a fuss about coconut milk or digging the meat out of a walnut. Of course, no one was portraying coconut juice as a replacement for milk. No one in their right mind would confuse nuts with actual meat.

So, plenty of labeling battles will be fought along the way. And, that's before considering products cultured from animal cells, which remain unavailable commercially. At least part of the reason has to do with the battle currently being waged over which government agency will regulate them.

“A number of U.S. cell-cultured meat companies are developing products that some believe could be sold within three years in certain markets and widely available in 10 years,” according to a Congressional Research Service report (Regulation of Cell-cultured Meat) published in October.

That same report notes that cell-cultured meat is also known as lab-grown meat, clean meat, in vitro meat, imitation meat, synthetic meat, and fake meat.

The war over regulating cell-based meats is barely past the starting blocks. Thus far, some outside of agriculture champion the Food and Drug Administration (FDA), while agricultural producers favor the U.S. Department of Agriculture (USDA).

“Ensuring lab-grown fake meat products are subject to strong, daily inspection by USDA's trained professionals is essential,” says Jennifer Houston, president-elect of the National Cattlemen's Beef Association (NCBA). She made the comments during a recent two-day meeting, hosted by USDA and the FDA. The meeting—Use of Animal Cell Culture Technology to Develop Products Derived from Livestock and Poultry—included discussions about the safety and marketing of cell-based fake meat, as well as which agency will ultimately have regulatory control.

“The health of consumers is on the line, and USDA is far better suited to ensure the safety of lab-grown products,” Houston explained.

At the same meeting, the North American Meat Institute (NAMI) continued to argue that the USDA Food Safety and Inspection Service (FSIS) have primary jurisdiction for regulation of new cell-based meat products.

“That the inspection system FSIS administers is more rigorous than the one administered by FDA is undeniable. Administration officials have said as much,” explained Mark Dopp, NAMI senior vice president of Regulatory and Scientific Affairs. “I am baffled why those who advocate that FDA should have primary jurisdiction over cell-based meat products want to deny those companies the benefits of FSIS inspection.”

FSIS oversight includes the USDA mark of inspection, providing consumer confidence that a product has been deemed wholesome by the agency.

Dopp also detailed the importance and benefits of USDA's label approval process, which protects companies from frivolous lawsuits and gives consumers confidence that products are accurately labeled and not represented to be something they are not.

“USDA can be trusted to enforce truthful, transparent labeling of the products under its jurisdiction,” explained Kevin Kester, NCBA president. “Beef producers welcome competition, but product labels and marketing must be based on sound science, not the misleading claims of anti-animal agriculture activists.”

Fad or not, these protein substitutes will likely be around for a while.

“It's clear by the growth in plant-based protein case shipments to foodservice and restaurant operators that this category has mainstreamed beyond those who choose a meatless diet,” explained David Portalatin, industry advisor for NPD's Food Sector, earlier this year.

According to NPD research, 14 percent of U.S. consumers, which translates to over 43 million consumers, regularly use plant-based alternatives such as almond milk, tofu, and veggie burgers, and 86 percent of these consumers do not consider themselves vegan or vegetarian.

Beef alternatives make up 44 percent of the plant-based categories being shipped to independent and micro-chain restaurant operators (U.S.) and are the primary contributor to the total category's growth, according to NPD. Burgers are the largest beef alternative category but ball products, like meatless meatballs, used as ingredients have outpaced burgers and all other plant-based protein formats in terms of growth.

Also, keep in mind some of the household names that are already producing alternative meat products and/or have investments in other companies that are producing or intend to produce these products. They include Cargill (Memphis Meats), Tyson (Beyond Meat and Memphis Meats) and Kellogg (Morningstar Farms).

Other highlights from the CoBank report:

• The competitive impact of cultured meat on traditional pork, beef and poultry demand is expected to be minimal.
• Cultured meat developers are challenged by the need to compete head-to-head with traditional meat offerings on cost and quality. Initial consumer surveys also reflect the acceptance hurdles that must be cleared.
• Cultured meat could appear in restaurants and specialty stores in three to five years, and in grocery stores in five to eight years.

Other highlight from the R&M study:

• The quorn-based segment is expected to grow at a CAGR of 8.5 percent during the forecast period.
• Europe is expected to dominate the market, registering a CAGR of 7.3 percent in terms of value.
• Exponential demand growth is projected for the Asia-Pacific through 2025, growing at the highest CAGR 9.4 percent, in terms of value.
• The soy-based segment is anticipated to dominate the global meat substitute market registering CAGR of 7.2 percent.







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