The market for plant-based protein continues to grow, undeterred by the COVID-19 pandemic. The outbreak may actually be helping to drive growth, some industry experts say.
Starbucks is launching a plant-based menu in China that includes Beyond Meat lasagna and a Beyond Beef Spicy & Sour Wrap starting today.
“Today we mark an important milestone as Beyond Meat launches in China, advancing our goal of increasing accessibility to plant-based protein globally,” said Ethan Brown, chief executive of Beyond Meat in a statement.
Dishes made with OmniPork, a plant-based pork brand, and Oatly oatmilk are also being added.
“We think China is an attractive market for alternative meats given the protein supply shortage caused by African swine fever and meat production constraints caused by chronic land and water shortages near major cities,” wrote Arun Sundaram, in a note for CFRA.
“Next, we look for Beyond Meat to establish a production facility in this region, since it’s typically wise to be near the consumers/competition in markets with major cultural differences so that trends can be easily spotted.”
CFRA rates Beyond Meat stock hold with a $95 price target, down $5.
Beyond Meat rival Impossible Foods has also been expanding over the past week, announcing on Tuesday that it will begin offering one-third-pound Impossible Burger patties through food wholesaler Cheetah, directly to consumers.
Last week, Impossible Foods announced that it would begin selling in an additional 777 supermarkets across the Chicago area, California and Nevada, including Albertsons and Safeway locations.
“So far we’re on track or ahead of the trajectory to replace animal protein with plant-based,” said Pat Brown, Impossible Foods’ CEO, during an event that the company broadcast online.
Dennis Woodside, president of the company, highlighted the problems at slaughterhouses that have arisen during the coronavirus outbreak, including the shutdown of a Smithfield Foods pork-processing plant in South Dakota.
“Our advantage: Our process is inherently safer than animal-based meat,” Woodside said.
As the coronavirus outbreak wears on, some see a future in which preventing illness becomes a bigger part of the health-and-wellness picture.
“Most infectious disease outbreaks are transmitted from animals to humans,” wrote CFRA in a separate note published this month on lab-based meats, which uses animal cells to create meat.
“Since lab-based meat is produced in a clean and controlled environment, we think the progression of the lab-based meat industry could be accelerated as more zoonotic outbreaks occur,” CFRA wrote.
Another major food company growing its plant-based protein portfolio is Morningstar’s Incogmeato brand. The company launched burger patties in March and has plans to expand into Italian sausages, bratwurst and “Chick’n” nuggets later this year.
Morningstar is part of the Kellogg Co. K, -1.26% portfolio.
New brands are also popping up and thriving.
Kimberlie Le and Joshua Nixon launched Prime Roots in 2017 at the Alternative Meat Lab at UC Berkeley’s Sutardja Center for Entrepreneurship and Technology. Prime Roots sells meals and proteins directly to consumers online. Items are made with the Koji fungus, which is also used in the fermentation process in Asian cuisine.
Prime Roots recently introduced Koji-based bacon.
“I don’t see the plant-based protein industry slowing down,” Le told MarketWatch.
In fact, Prime Roots may be at the intersection of two trends that have arisen during pandemic social-distancing measures: a greater willingness to try new items at home and online grocery shopping.
“As one of the only companies selling plant-based meats and seafoods online, we have seen a huge surge in our demand as consumers are wanting to try these products at home and are interested in a diversity of products, which can be hard to find in stores,” she said.
Originally Published on MarketWatch
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