Plant-Based Meat Substitutes Under Pressure: Rabobank
New research conducted by Rabobank reveals that the plant-based meat substitute market is facing significant challenges, including declining consumer interest, reduced production by manufacturers, and decreased supply at supermarkets.
The study indicates a notable drop in sales of plant-based meat substitutes in both the United States and the United Kingdom over the past year and a half.
Similarly, supermarket sales in the Netherlands within this category have encountered difficulties, with sales volumes falling by 2.5% in the previous year. This occurred despite the fact that the price of meat substitutes did not increase as rapidly as that of traditional meat.
While the demand for plant-based meat substitutes is driven by ethical considerations related to animals, taste remains a primary factor for consumers.
Additionally, factors such as price, natural and recognizable ingredients, health benefits, and variety play crucial roles in the success of these products, according to Rabobank.
The current state of the market reveals that many plant-based meat substitutes do not match the taste and experience of their meat counterparts. This realization is becoming more apparent among consumers.
The research highlights the challenge of convincing consumers to replace traditional meat products, like steaks or hamburgers, with plant-based alternatives.
It’s much easier to integrate minced vegetables into frozen lasagnas or substitute chicken in products like chicken nuggets.
Furthermore, as some meat substitute products become increasingly complex with added ingredients to mimic the taste of meat, they raise health concerns due to their “ultra-processed” nature.
Rabobank stresses the importance of scrutinizing the raw material supply chain. Simplifying operations can lead to fewer ingredients and lower costs, which is a more effective approach than solely focusing on achieving economies of scale.
The report anticipates further consolidation within the plant-based meat substitute industry, including brand consolidation, range refinement, and production capacity adjustments.
Several companies that initially invested in expanding their capacity and brand offerings are now reconsidering due to shifting consumer preferences.
Notably, companies like Samworth Brothers and Nestlé are withdrawing from the plant-based meat substitute market. In the Netherlands, certain brands are already disappearing from supermarket shelves.
To address the issue of overwhelming consumer choice, Rabobank suggests that rationalizing the variety of brands and products available could help consumers make more informed decisions.