What’s next for alternative proteins after category consolidation?

The growth of the alternative proteins market – which includes plant-based, cultivated meat and fermented products – has been one of the most significant developments in food manufacturing over the past 20 years.

Where once vegetarian and vegan diets were considered niche, more people in the UK are opting to reduce their consumption of meat and animal products, or cut them out altogether, every year.​​

However, it has not been plain sailing for the relatively young category. The past year or so has seen the market reach a consolidation stage, with some brands being bought up by bigger players and others exiting altogether.​​

Several countries have sought to implement new rules​​ designed at reducing confusion around the labelling of meat-free products, while others have even banned the development​​ of new technologies such as cultivated meat.

All in all, it is fair to say that this sector will continue to generate headlines, especially as manufacturers come under more pressure from consumers and governments to offer sustainable food options.

According to research by the University of Oxford, a high meat diet leads to 10.24kg in CO2 emissions per day, whereas vegetarian and vegan diets contribute 4.16kg and 2.47kg respectively. With that and other research in mind, it is incumbent upon the sector to get people eating less meat, but in a way that leads to a sustainable future for the sector.

To take stock of all this, Food Manufacture spoke to several key players within the alternative proteins space and asked where we are and where we might be going.

The growth of alternative proteins

According to the EU-backed Smart Protein Project, the UK is one of the largest markets for alternative proteins in Europe. In 2020, sales of products across the category reached nearly £640m, while British firms in the space raised £41m during that same year. Furthermore, the investment in alternatives proteins between 2019 and 2020 represents 90% of the total investment made in the UK category since 2006, evidence of its rapid growth in recent years.

Looking ahead, the Green Alliance projects that the UK alternative proteins market could be worth £6.8bn annually and create 25,000 jobs by 2035.

But what has driven the category to develop? Sandy de Houwer, global marketing director for meat and dairy alternative solutions at Cargill, believes that the pursuit of sustainability has been a “primary driver”.​

“With the pressing challenge of feeding a fast-progressing global population more sustainably, there's a growing imperative to explore alternative protein sources,” ​de Houwer told Food Manufacture.

“This imperative is mirrored in consumer preferences, with sustainability being a top consideration alongside desires for healthier and more mindful eating habits.”​

This analysis is supported by HealthFocus International findings, which showed that 62% of consumers in EMEA have expressed interest in plant-based protein options, with that number even higher among younger people.

Alison Reilly, head of marketing at the Vegan Food Group (VFG), echoed de Houwer, while she also pointed to concerns about animal welfare and health.

“The alternative protein category has been shaped and driven by consumers seeking more ethical, healthy and environmentally sustainable options to meat, due to heightened awareness of the destructive impact meat has on animal welfare, our health and the planet,”​ Reilly explained.

Parm Bains, co-founder of plant-based Asian food manufacturer SHICKEN, added: “Awareness of how animal-based products are produced, the environmental impact, combined with the cruelty animals are enduring has increased significantly over the last five years through social media and popularity of documentaries, such as The Game Changers and The Blue Planet.”​

In addition to ethical and environmental considerations, director for EMEA protein marketing at ADM, Alicia Humpert, credits improvements made to the taste of products that now fill supermarket shelves.

“The alternative protein market has expanded to encompass an array of offerings, reaching beyond the veggie burger to whole-muscle meat alternatives and plant-based frozen treats,”​ Humpert told Food Manufacture.

“Consumers’ demand for protein diversity and choice drives this evolution. Consumers also recognise protein consumption is not an all-or-nothing approach, but rather there are a spectrum of options that can meet their needs, thus opening up the category to more protein exploration and innovation.”​

This change, Humpert added, has been brought about by advancements in food science and technology.

“Companies are now able to create products that closely mimic the sensory experiences of traditional meat, dairy and eggs, satisfying the curiosity of consumers eager to explore new dietary possibilities without compromising the sensory experience,”​ she said.

Broadening the appeal

While the growth of the alternative proteins category has been significant, it has not yet managed to appeal to a portion of consumers.

According to data published by the Smart Protein project​​, 37% of UK consumers said that taste was preventing them from eating more plant-based products, while 43% cited price as an obstacle.

When asked what the food industry can do to increase the appeal of meat-free alternatives, consumer director at Quorn Foods Gill Riley said that “​improving taste perceptions” ​must be central to its approach.

“Taste is still the number one driver when it comes to all food decisions,”​ Riley told Food Manufacture.

“We know that a barrier for people considering meat free can be the idea it won’t be the same as the meat dishes they’re used to. We continue to challenge this perception with all of Quorn’s product launches.”​

Riley explained that Quorn has placed specific emphasis on understanding what consumers want and ensuring its products are accessible.

“Investing heavily in consumer research, taste and sensory technology allows us to keep creating products that our shoppers love and that make switching to meat free so simple and enjoyable,”​ she added.

Bains agreed, telling Food Manufacture that the key to the future of alternative proteins was “quality, quality and quality”.​

“Manufacturers have to invest in R&D and up their game to ensure that alternative protein products close the gap between the animal protein they are replicating in terms of texture, appearance, flavour and nutritionals,” ​he continued.

“Only then can they attract a larger, wider target audience.”​

In addition to quality, Humpert argued that the nutritional content of meat-free products will continue to come under great scrutiny. Alternative proteins have not been exempt from the ongoing debate surrounding ultra-processed foods (UPFs) and ADM research has shown that nearly half of consumers interested in the category seek plant-based products with an enhanced nutritional profile.

“Familiar plant proteins like soy, pea and wheat coupled with lentils and other wholesome ingredients such as beans, pulses, ancient grains, seeds and nuts cater to a wide range of dietary preferences,”​ explained Humpert.

“However, while consumers see various benefits in plant-based products, 55% and 61% of global plant-forward consumers feel they’re missing certain nutrients in plant-based meat and dairy alternatives, respectively. Manufacturers can solve this challenge by incorporating ingredients like fibre, pre-, pro- and postbiotics, botanicals and more to meet consumer demands for expanded food and nutrition optionality, ultimately making protein alternatives more attractive to consumers.”​

New technology will also be crucial as the industry looks to develop a broad range of alternative protein products that taste good and appeal to a diverse range of consumers.

Cargill is working with several partners with this in mind, de Houwer said, including Cocuus and ENOUGH.

“​Innovations such as whole-cut technologies and cultivated proteins offer promising avenues for creating meat analogues and hybrid products,”​ she continued.

“We're helping Cocuus scale up its technology for producing plant-based bacon, with a goal of producing as much as 1,000 tonnes of 3D printed plant-based bacon in 2024.​

“Moreover, partnerships like Cargill's collaboration with ENOUGH showcase the potential for more sustainable protein production through mycoprotein fermentation. ENOUGH's ABUNDA mycoprotein not only addresses environmental concerns but also offers meat-like texture, desirable nutritional profiles, and scalability.”​

Category consolidation

After years of growth, 2023 proved a difficult year for the many firms within the alternative proteins space.

It was first reported in June of last year that both Plant & Bean and Meatless Farm had entered administration, with rising costs and the competitive nature of the sector cited as a contributing factor in each instance. A few months later and LoveSeitan announced that it had ceased trading.

Plant & Bean was acquired by VBites, which subsequently went into administration itself before being revived under the leadership of Heather Mills, while Meatless Farm was bought by VFC Foods. Both brands are now part of VFG.

The group also acquired Clive’s Purely Plants last year, before also purchasing TOFUTOWN in February 2024. Asked to reflect on the amount of consolidation in the sector, Reilly attributed the trend to several variables.

“Some brands lacked product quality, while others have priced themselves out of the market, and this has led to competitors being unable to manage rising input costs,”​ she said.

“At VFG we have been fortunate to have the backing of a single investor who is committed to the movement and the sector, whereas many brands have been funded by multiple investors who backed out when the market became more challenging.”​

Quorn and Riley noted that while the market was “inundated with new product”,​ not all managed to keep shoppers coming back.

“Focusing on products that will recruit and keep shoppers in the category is key, this is driven by quality food that tastes great and is available at accessible price points,” ​she continued.

“For brands to stay on shelf, it is also vital to continually invest in long term growth, as well as responding to the changing needs of the consumer in the shorter term.”​

Finally, Bains argued that this “period of consolidation”​ was typical for any young category where numerous brands look to “capitalise”​ on an opportunity. However, he witnessed the crucial variables of taste and price being placed “too low down the priority list”​ by certain firms.

“This has all inevitably led to some brands not going the distance,” ​Bains concluded.

What’s next?

The alternative proteins category has come a long way, but still has untapped potential. In order to keep growing and appeal to more consumers than ever before though, Humpert believes that investment in “technology, infrastructure and research”​ is essential.

“Collaboration across the industry, including working with manufacturers, academics and start-ups, is also critical for advancement,” ​she said.

“For example, ADM recently unveiled a new innovation centre on the grounds of Wageningen University in the Netherlands to enhance customer collaborations and work closely with industry partners, ensuring new product development in the plant-based space addresses formulation requirements and evolving consumer demands.”​

Meanwhile, Bains warned that industry cannot become overconfident and satisfied with the progress made up until this point: “Continued investment into product innovations to drive mainstream appeal is key for this category, continually improving product quality remains a key factor and brand owners should not become complacent but stay ahead of the competition by delivering the very best products in market.”​

As for Quorn, Riley said that the manufacturer was committed to delivering taste but at an affordable price.

She added: “We know that value for money continues to be on shoppers’ minds. We will be keeping this at the forefront of our strategy, challenging taste and affordability perceptions.​

“While many brands and products come and go, Quorn has been a constant, also delivering share growth ahead of the total market in key areas.”​

De Houwer echoed this sentiment and explained that affordability was key if the category was to attract meat eaters and those looking to reduce their consumption of animal products: “Achieving price parity with animal-derived solutions is imperative, necessitating innovation to optimize production processes and reduce costs. We can do this through innovation – doing more with less and leveraging our full portfolio of solutions.”​

If this price parity is achieved, ADM research has shown that consumers are curious to experiment with a wide range of alternative protein offerings.

“When asked about technological advances, global plant-forward consumers stated they’re most interested in trying plant-based products with novel plant-based ingredients, followed by hybrid alternative options, then fermentation-derived sources and lastly cellular agriculture created products,”​ Humpert said.

“As we look ahead, there is great opportunity for manufacturers to leverage new protein sources, blends, hybrids and advancements in technology that can support an optimised sensorial experience and nutritional value.”​

Whatever comes next, the stakes are high as the global food industry looks to reduce its impact on the environment and bolster food security into the future. Whether the innovation and investment that is necessary arrives, remains to be seen.

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