Current food prices aside, driving awareness of plant-based protein diets is vital
In real terms, the global rise in inflation rates is a significant concern. Rising prices is persistent, and the main worry for consumers in recent Ipsos surveys. Affecting buying decisions, this then extends to producers and suppliers the world over who must make business decisions that balance the need for consumer affordability alongside their own rising costs.
For the plant-based protein market, the effect is clear - consumers are beginning to ‘trade down’ from plant-based meat to less expensive protein alternatives, including conventionally sourced meats.
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In Estonia, the January 2023 inflation rate was 18.6 percent, after hitting over 20 percent in 2022. The consumer interest in more expensive meat alternatives has become a matter of economics. With conventional meat and meat products often at half the price of alternatives, preferences based on lifestyle or ethical choices are becoming secondary to sheer affordability.
The plant-based protein market holds an estimated value of USD 12.2 billion as of 2022. Growth is still expected here but will slow during the current rate of inflation. Bringing down costs for manufacturers will be the core solution to gain market share. It’s vital, therefore, that all industry stakeholders start to work together for a solution to enable plant-based protein rich products to be more accessible to consumers looking for them.
Plant-based proteins are a sustainable opportunity for replacing animal sourced proteins that benefits not only public and environmental health but also animal welfare.
The solution of lowering manufacturing costs may not be easy to digest for producers, who need to ensure the protein quality and create new functional, healthy and environmentally friendly products at an attractive price point for current consumers.
At the Center of Food and Fermentation Technologies (TFTAK) - a privately-owned contract research organization that focuses on developing innovative solutions for the food and biotechnology industry - our mission is to accelerate plant-based protein research and support our partners in launching new products and services based on the novel approach of food synthetic biology. We rely on emerging technologies to extract and process plant proteins into next-generation healthy meat and dairy alternatives with a superior taste and texture and at a reasonable price. We know that the key to feeding the planet while preserving our environment is transferring food production from the farms and fields to large-scale bioreactors, that are not dependent on the climatic conditions, affected by global pandemics or the availability of agricultural land.
We noticed that others were more cautious of starting projects during the previous energy crisis when outcomes are unclear, but opportunities for grants and funding remained available. Challenging market conditions amplify the importance of re-evaluating new technologies, energy consumption, raw materials, and waste management plans.
Inflation has reduced the enormous investment growth that we have seen previously, but it has not stopped nor lowered the investments. Private investments into plant-based protein in 2019 was more than USD 500 million growing in 2020 to more than USD 2.1 billion. Cultivated foods and fermentation-enabled foods show a strong increase in investments and will probably level with plant-based proteins in a few years.
Alongside the rise in production costs, the plant-based protein market still experiences lower acceptance levels by traditional meat eaters. Whilst price is one issue, the sensory quality of products that mimic the conventional meat or meat and dairy products can also be another. In real terms, any denigration in product experience means there will be no repeat purchase and is not only negative in terms of brand loyalty, but in terms of the full category also. When we develop new products, we make sure to follow all crucial steps – sensory analysis with expert assessors, consumer studies with target market consumers and dietary intervention study if applicable.
The plant-based protein market is facing the balance of navigating not only economic constraints powered by global inflation rises, but the category acceptance within mainstream consumer eating and buying habits.
Combatting this must be a mixture of cost control, without compromising on quality, alongside raising awareness of the benefits of plant-based consumption within the wider arena. Producing and importing from countries such as Estonia, considered as one of the worlds ’cleanest’ countries based on air quality and agricultural standards is cemented with the alignment of the UAE’s commitment to sustainability and food security goals.
Being based in Estonia, we see that the world is open to collaboration on international, science-based projects, and do not see this as a location dependent industry for growth. Approximately 35 percent of our income comes from international collaborations, contract research or scientific collaboration.
As our home country, we see many benefits to being based there, with the ability to collaborate with other Estonian companies, institutes and farmers to help to solve problems, create value added products and find new innovative solutions. Developing new functional foods and beverages using local uncommon raw materials is something we are keen on.
People all over the world want to experience new flavors and taste new food products – this gives Estonian companies the opportunity to show how rich our natural resources are and that if you can combine traditional raw materials and innovative R&D approaches, you get products that everybody will want to taste and experience.
If we want to reduce animal-based protein consumption to be more sustainable and address global challenges such as climate change and food security, then it is crucial that we become excellent at educating omnivores on the lifestyle and ethical benefits of plant-based protein rich products.
But to achieve this positive change, we must make sure that the products that reach the market can be tasted for the very first time by a skeptical consumer, and on this basis the current price points and promotional awareness are as front of mind as the quality.
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