Has Plant-Based Meat Already Reached Its Peak?
New trends rarely grow forever. Fashion comes and goes. Blockbuster Video went out of business (except for that one in Bend, Oregon). Even the hard seltzer craze may be on the downswing. Sure, occasionally, a new concept becomes fully embedded in our everyday life — smartphones replacing the landline — but truly revolutionary movements are few and far between.
So what's going on with plant-based meat? We're coming up on five years since burgers from Impossible Foods and Beyond Meat established our modern perceptions of plant-based meat — which is to say, products that are intended to replicate the flavors and texture of real meat. And plant-based foods have undeniably made inroads: Most major chains now have at least one plant-based option.
But from the beginning, the plant-based movement has had loftier goals than offering another vegetarian option. The idea was to replicate meat so perfectly that consumers could do away with meat entirely, eradicating the world of all of meat production's environmental and ethical issues.
Of course, eliminating meat eating was probably never going to happen. But at the same time, some analysts are wondering if plant-based meat has already reached its ceiling before even giving real meat a run for its money.
A couple weeks ago, Beyond Meat announced its fourth quarter and year-end financial results, and the news was not well-received. Net revenues were actually down 1.2 percent compared to the same quarter last year, and U.S. grocery sales were down 19.5 percent.
Beyond Meat said that a "loss of market share" may have played a role in the decrease "to a lesser extent" — suggesting that the market is (maybe) getting flooded but not saturated. However, data elsewhere suggests a larger plant-based problem may exist.
Citing data provider Spins, the Financial Times reported that U.S. sales of plant-based meat overall actually dropped by 0.5 percent in 2021 after seeing a 46 percent increase in 2020, representing a significant leveling off. And Canada's Maple Leaf Foods offered a similar assessment: Their plant-based sales grew 59 percent in 2019 and 75 percent in 2020, but grew only one percent in 2021.
The numbers also seem to show that plant-based meat isn't putting much of a dent into the traditional meat market. Jonna Parker, principal for fresh foods at the analytics giant IRI, recently pointed to the massive difference in sales numbers, according to Food Navigator: Yes, retail sales of plant-based meat in the U.S. were up 45 percent from 2019 to 2020, but that only got those numbers up to $1.4 billion, whereas traditional meat sales at U.S. retail over the same period held steady… at $82.2 billion. Looking at the five year period from 2016, grocery meat sales are actually up 45 percent as more people are eating at home.
Additionally, IRI data showed that 98.5 percent of U.S. households bought meat in 2021, and averaged over 50 grocery store trips in the year to do so. "Those are some huge numbers that frankly no other department can claim," Parker was quoted as saying.
Of course, five years — especially the wild five years we've been through — may be too short of a timeline to know exactly what's going on in the plant-based market. Speaking anecdotally for myself, after trying plenty of plant-based products, the increasing variety of options out there include a plenty of good brands that are imitating real meat — and plenty of other brands are imitating the imitators.
During Beyond Meat's earnings call, that was essentially the stance that founder and CEO Ethan Brown took. "I think as attractive as it is to try to posit particular theories on what's going on, there's so much noise in the market just because of the instability around the pandemic, the different variants, behaviors, [selling our products to both] foodservice to retail, that we're just kind of sitting out of that discussion and saying, 'Here are the things we can control,'" he said.
So no, one year of slumping data isn't enough to make a determination about the long-term future of plant-based meat, especially when the category is still clearly dynamic and evolving. But at the same time, ignoring the data entirely doesn't seem to be the answer: something is definitely happening (or not happening) with plant-based meat, even if we're not yet entirely sure what.