GFI Says Plant-Based Meats Will Become Less Expensive Than Conventional Meat

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A report from the Good Food Institute predicts that plant-based meats will soon become more affordable than animal products, arguing, logically, that it is inherently more efficient to make meat directly from plants rather than feeding the crops to animals then later eating those animals.

The issue of the cost of plant-based meats is one that often arises in veganism, with several products being priced extortionately when compared to their animal equivalents. A recent study suggests further that conventional meats should in fact involve added taxes due to the implicated effects on the health system.

However it is important to remember that these products are in their infancy at present and will inevitably become more cost-effective in due course. Good Food Institute author, Liz Specht, Ph.D., outlines several determining factors which are contributing to the current discrepancy between the cost of animal and plantbased meats, as follows:

Profit margins

Specht notes that, as new vegan meat companies are operating in a free market, it is inevitable that they will aim to maximize profit, and that involves charging as much as the consumer is willing to pay. “Current players such as Beyond Meat and Impossible Foods are currently producing as much as they can and are still unable to meet demand. There is no reason for them to charge less than consumers will pay at this time…”

Ingredient supply

Specht explains that, at present, plant meat producers are not yet of adequate size to optimize supply lines. “Even with the significant recent growth, the entire plant-based meat industry is still operating at an exceedingly small-scale relative to industrialized animal agriculture.” This lack in terms of size means that companies are currently less able to negotiate prices for raw materials, with for example, Impossible Foods currently acquiring soybean protein as a byproduct of the soy oil industry, and Beyond Meat’s pea protein being predominantly raised for their starch content. “There are huge efficiency and functional gains available when companies reach a size where they can procure raw materials optimized for making plant-based meat.”

R&D costs

Since this is a relatively emerging field, the leading plant meats are predominantly funded by venture capital firms and have substantial research and development expenditures to recoup.

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Leveraging economies of scale

Due to the arrival of Big Food on the plant-based scene, corporations such as Tyson, JBS, and Nestlé will bring along large-scale production and less focus on new technologies. “This, along with greater competition in the space, will also significantly drive prices down.”

Summary

The report argues that it is inevitable that the plant-based meats will eventually be cost-competitive with animal meats, and predicts that the tipping point could be very soon, “given the recent flurry of activity reflecting new production capacity among the existing plant-based meat companies and the involvement of new entrants with massive resources.” Specht concludes that once plant meat gains sufficient market penetration, the industry will “enter a bright new era of accessibility and affordability that will benefit both consumers and producers.”

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