Unreal Food ended its pursuit of an eggless egg. Remastered Foods stopped developing vegan bacon. The Meatless Farm halted its plant-based sausages.
The great shakeout in the world’s fake meat sector is here and it’s widening.
As money flows less freely due to surging interest rates, investors have sharply pulled back funding just as inflation increases production costs and makes consumers more selective about their food choices. That’s hitting a crowded field, which had mushroomed after the early success of Beyond Meat and Impossible Foods.
Photo: AFP
With shoppers put off by excessive processing, nutritional value and taste, a growing list of alternative-protein companies are shutting down, laying off staff and selling themselves. Industry observers say more turmoil is coming before the sector stabilizes.
“You probably need a bit of a clear out in some of these categories to allow winners to come through,” said Mark Lynch, a partner at Oghma Partners in London, a corporate-finance advisory specializing in the food and beverage sector. Fewer players means resources will be more concentrated and survivors will control more of the available shelf space, he added.
Enthusiasm for alternatives to beef and pork surged in the aftermath of Beyond Meat’s 2019 initial public offering, and venture capitalists were willing to invest in companies that offered little more than a recipe book.
But sales haven’t matched wildly optimistic projections, as high prices and odd tastes and textures made the costly products easy to cross off shopping lists. The spate of failures extends from plant-based proteins and vertical farmers, to insect breeders and lab-grown meats. Global investment in food and agriculture tech dropped 44 percent in 2022, according to AgFunder.
The downturn has so far mainly claimed obscure names and early-stage companies, like Canada’s Merit Foods and China’s Hey Maet.
But in the UK, two up-and-coming companies recently appointed administrators: The Meatless Farm laid off staff at its headquarters in Leeds, while Plant & Bean got hit by soaring food and energy prices just two years after opening a mega factory in Lincolnshire.
ADJUSTMENT PHASE
The upheaval is part of an adjustment phase that happens in almost every high-growth consumer segment from smoothies to popcorn, said Andy Shovel, co-founder of British plant-based meat company THIS, whose sales are up about 45 percent this year.
The result will be less confusion at stores, better quality and prices getting closer to meat, according to Shovel.
“From a customer’s point of view, this is only good news,” he said.
Industry stalwarts have also stumbled. Beyond Meat, which has seen its market value drop over 90 percent from its peak, has had multiple rounds of layoffs in the past year, as has Impossible Foods. Cuts have also affected Spain’s Heura Foods and California-based Eat Just, which has continued to expand distribution in the US.
Traditional food companies are also retrenching. Nestle SA pulled its Garden Gourmet line and Wunda pea milk from the UK because of intense competition. Meat giant JBS SA discontinued its Planterra unit after pouring money into a mega factory in Colorado.
INVESTORS UPBEAT
Despite the turmoil, some investors remain upbeat. Big Idea Ventures, a food-tech investor fund, said last month that it’s closing in on a US$75 million fund-raising target. Fake bacon maker MyForest Foods raised US$15 million in fresh funding earlier this month, and Israeli startup Chunk Foods announced a seed round of the same size in the spring.
Agricultural giant Archer-Daniels-Midland still has faith in the sector, too. At an innovation center in Manchester, England, the company mixes processed soy with flavors to help make alternative proteins more appealing. Its venture capital unit is also continuing to invest in startups.
“The category is now evolving into what really consumers have been asking for,” said Leticia Goncalves, ADM’s president of global foods. “Companies are now learning from the past and adjusting with new launches.”
ADM expects the alternative-protein market to grow annually by “high single-digits” and reach US$100 billion in sales by 2030. Euromonitor International, which tracks sales in retail outlets and food services, predicts global sales volume of meat and seafood substitutes to grow more than 10 percent this year.
About two-thirds of young consumers are planning to spend more on vegan meat and dairy products citing health perceptions and environmental benefits, according to Emma Ignaszewski, associate director at Good Food Institute, an industry group.
For some companies, the disruption is an opportunity. Minnesota-based Wicked Kitchen — a maker of vegan convenience foods like jackfruit pepperoni pizza — acquired plant-based seafood company Good Catch for over US$7 million in stock as well as vegan fish brand Current Foods in a deal valued between US$7 million and US$10 million, said Chief Executive Officer Pete Speranza.
Food is now widely understood as central to efforts to combat the climate crisis and alternative proteins are seen as delivering the biggest benefit, according to Rosie Wardle, a partner and co-founder of Synthesis Capital, who has been active in the space for a decade.
“This correction was overdue,” she said. “The best companies in the sector will be able to find the capital they need even in these challenging times. Ultimately this sector is here to stay.”
The Portuguese never established a presence on Taiwan, but they must have traded with the indigenous people because later traders reported that the locals referred to parts of deer using Portuguese words. What goods might the Portuguese have offered their indigenous trade partners? Among them must have been slaves, for the Portuguese dealt slaves across Asia. Though we often speak of “Portuguese” ships, imagining them as picturesque vessels manned by pointy-bearded Iberians, in Asia Portuguese shipping between local destinations was crewed by Asian seamen, with a handful of white or Eurasian officers. “Even the great carracks of 1,000-2,000 tons which plied
It’s only half the size of its more famous counterpart in Taipei, but the Botanical Garden of the National Museum of Nature Science (NMNS, 國立自然科學博物館植物園) is surely one of urban Taiwan’s most inviting green spaces. Covering 4.5 hectares immediately northeast of the government-run museum in Taichung’s North District (北區), the garden features more than 700 plant species, many of which are labeled in Chinese but not in English. Since its establishment in 1999, the site’s managers have done their best to replicate a number of native ecosystems, dividing the site into eight areas. The name of the Coral Atoll Zone might
On Monday morning, in quick succession, the Chinese Communist Party (CCP) and the Chinese Nationalist Party (KMT) released statements announcing “that the Central Committee of the Communist Party of China and General Secretary Xi Jinping (習近平) have invited KMT Chairwoman Cheng Li-wun (鄭麗文) to lead a delegation on a visit to the mainland” as the KMT’s press release worded it. The KMT’s press release added “Chairwoman Cheng expressed her gratitude for the invitation and has gladly accepted it.” Beijing’s official Xinhua news release described Song Tao (宋濤), head of the Taiwan Work Office of the CCP Central Committee, as
Nuclear power is getting a second look in Southeast Asia as countries prepare to meet surging energy demand as they vie for artificial intelligence-focused data centers. Several Southeast Asian nations are reviving mothballed nuclear plans and setting ambitious targets and nearly half of the region could, if they pursue those goals, have nuclear energy in the 2030s. Even countries without current plans have signaled their interest. Southeast Asia has never produced a single watt of nuclear energy, despite long-held atomic ambitions. But that may soon change as pressure mounts to reduce emissions that contribute to climate change, while meeting growing power needs. The
RSS