The Future of Meat

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The Future of Meat

By Angela Flatland - 01/18/2018
Uma Valeti, CEO of Memphis Meats

It’s 2050 and the earth’s population has grown nearly 40% to almost 10 billion inhabitants. In order to feed the mass of humanity, grain, bean and seed production previously utilized for animal farming is allocated to the production of meat alternatives. Traditional protein producers have become dominant players in the plant-based world, a system of grading and certification exists and restaurant menus are filled with plant-based options.

The above scenarios are not far-fetched given recent business trends, improved flavor profiles and broader consumer acceptance of plant based foods. The meat alternative space has become quite crowded with entrepreneurs, billion dollar corporations, investors and entrepreneurs vying for a piece of the action as there is solid evidence that plant-based meat alternatives are at the beginning of a generational shift in consumer acceptance. And there is also the issue of the planet’s burgeoning population. The United Nations projects the global population to reach 9.8 billion by 2050 making advances in plant-based proteins essential as a solution to feeding a hungry planet.

When it comes to lab-grown meats, there’s already companies forging the path. Silicon Valley-based Hampton Creek, announced in June of 2017 that it will be the first company to release a line of “clean meat,” a term referring to meat grown in cell culture instead of harvested from livestock. While Hampton Creek may be the first to market with a packaged product, it’s not the only food technology company based in Silicon Valley that’s taking on the mission of clean meat. San Francisco-based Memphis Meats produces chicken, beef, duck and pork using clean meat science and technology and recently completed a $17 million series A funding round. Investors included big names like Richard Branson, Bill Gates and the largest supplier of ground beef in the world, Cargill.

“Memphis Meats has the potential to provide our customers and consumers with expanded protein choices and is aligned with our mission to nourish the world in a safe, responsible and sustainable way,” Sonya Roberts, President of Cargill Protein, said when the investment was revealed.

Summing up the point of view of many of those active in the world of alternative meat is Uma Valeti, M.D., co-founder and CEO of Memphis Meats.

“The world loves to eat meat, and it is core to many of our cultures and traditions. Meat demand is growing rapidly around the world,” Valeti said. “We want the world to keep eating what it loves. However, the way conventional meat is produced today creates challenges for the environment, animal welfare and human health.”

Clean meat is not the only futurist meat option on the rise. Meat alternatives and other plant-based proteins sales have been outperforming traditional categories and large companies have taken notice. Plant-based food and beverages grew 14.7% during the 52 week period ended July 8, 2017, according to Nielsen. More specifically, sales for online plant-based proteins in powder, bar and liquid have grown tenfold since January 2015 according 1010 data, a cloud-based platform for big data discovery and data sharing.

Growth always attracts a crowd, but especially now when growth in the food industry has been hard to come by in most categories. For example, Cargill isn’t the only meat producing CPG company making big bets. In October 2016, Tyson announced its investment in Beyond Meat, a company known for making pea protein chicken and beef alternatives that taste remarkably close to the real thing. More recently, Tyson was among the companies supporting Beyond Meat with a fundraising round totaling $55 million. The additional capital will be used to triple the size of the company’s production footprint, further fund research and development and expand sales and distribution. Beyond Meat’s signature product, the Beyond Burger, is already enjoys a foothold in some of the nation’s leading supermarket retailers and is finding its way on to restaurant menus.

"Global demand for all protein remains high and we're passionate about meeting that demand sustainably," said Justin Whitmore, Executive Vice President Corporate Strategy and Chief Sustainability Officer with Tyson. “Our investment in Beyond Meat provides another fantastic alternative for consumers as we strive to sustainably feed the world."

Another company attracting investor interest is Impossible Foods. In August 2017, the maker of the Impossible Burger, secured $75 million in funding from the Singapore-based investment company Temasek in addition to the Open Philanthropy Project, Bill Gates, Khosla Ventures and Horizon Ventures. The following month, the company announced a major production expansion with a 68,000-sq.-ft. production facility to meet anticipated demand.

“Our mission to transform the global food system is urgent, and the opportunity is huge so we are embarking on one of the most ambitious scale-ups of any startup in the food industry,” said Impossible Foods CEO and Founder Patrick O. Brown. “Our goal is to make delicious, sustainable, nutritious and affordable meat for everyone, as soon as possible.”

Canada’s largest meat processor, Maple Leaf farms, invested $260 million in 2017 to acquire s of two popular plant-based meat brands, LightLife and Field Roast. When acquiring Field Roast, Maple Leaf President and CEO Michael McCain said the deal aligns with the company’s mission to be a leader in sustainable protein. Other large CPGs investing in plant-based companies in recent years include Nestlé’s acquisition of Sweet Earth, Danone’s acquisition of WhiteWave, Hormel launching Evolve, a plant-based protein line, Otsuka’s acquisition of Daiya and Campbell’s launching Bolthouse Farms line of  nut milks.

The surge of deal activity follows growth in consumer demand with indications the trend is well established to support further expansion. For example, a 2017 consumer study by Nielsen found that 39% of Americans and 43% of Canadians are actively trying to incorporate more plant-based products into their diets.

“It’s not a short-term trend to eat less meat. People are more conscious of the health, sustainability and animal welfare factors.  It’s not likely they will go back to eating more meat once they’ve changed their diet,” said Emily Steingart, Brand Manager of Quorn, a meat substitute brand from the United Kingdom.

The plant protein category is projected to reach about $6 billion in global sales by 2022, a compound annual growth rate of 6.6%, according to the “Meat Substitutes Report” by Market and Markets data, a global market research and consulting firm.

Perhaps the surest indicator that a category has arrived is when a trade group is established to represent the interests of companies operating in the space. That was the case in March 2016 when 23 companies formed the Plant Based Food Association (PBFA) and Michele Simon was named Executive Director.

“The increasing demands for more products has been a challenge to keep up with but it’s a good problem to have,” Simon said. “We are receiving requests to create a plant-based food certification as well as to help with retailer collaborations,” said Simon, noting that she expects the PBFA to establish a plant-based certification in 2018.

“Overall, we know it’s a category to be prepared for growth no matter what business you’re in,” Simon advises. “Be prepared to grow with consumers. For retailers, it’s dedicating more shelf space to plant-based foods, collaborating to create in-store experiences to help shoppers find products, and building more prepared food options. For CPGs, it’s focusing on R&D to create more options, creating recipes with your products for food service, and keeping up with supply and demand.”