GFI flags potential struggles for plant-based sector while brands boom
27 Apr 2020 --- The COVID-19 pandemic is having myriad effects on small plant-based businesses. That is according to The Good Food Institute (GFI) Director of Corporate Engagement Alison Rabschnuk, who flags that plant-based brands have experienced some negative impacts on their business amid the global crisis. “It may take that sector a long time to recover,” she claims. Despite a surge in plant-based products launching, the outbreak spells uncertainties for the booming sector, according to the GFI. Meanwhile, European plant-based players Heura and fiid speak out about the unprecedented changes the global crisis has brought on, flagging the pandemic as “an inflection point,” and highlighting how consumers are seeking comfort in meat-free products, respectively.
“As consumers continue to purchase groceries, plant-based meat sales have seen double- and triple-digit growth over the past few weeks. Unfortunately, though, many new retail product launches have had to be placed on hold as retailers are focused on keeping current inventory in stock instead of resetting shelves. To adapt to this evolving economic environment, some start-ups are embracing direct-to-consumer models, which have gained in popularity as consumers seek to avoid grocery stores,” explains Rabschnuk.
In the light of new launches in the plant-based sector , the GFI says there could be trouble aheadLast week, Cargill partnered with fast food conglomerate Yum China to launch plant-based KFC fried chicken across China. The meat-free chicken substitute will be tested in Shanghai, Guangzhou and Shenzhen later this month. Meanwhile, Beyond Meat, through a partnership with Starbucks, is set to roll out its plant-based meat analogs in China. The company will begin by introducing its plant-based ground “beef,” branded Beyond Beef, to the new market amid a shift in consumer preferences for plant-based products spurred by the coronavirus outbreak.
Even in light of new launches in the plant-based sector, the GFI says there could be trouble ahead.
Plant-based research stunted?
COVID-19 will undoubtedly impact alternative protein research and development, according to the GFI, who are “closely monitoring governments’ response to the outbreak and economic downturn.” Director of Policy Jessica Almy, says the US-based plant-based food advocacy business will adapt its strategies “to ensure that governments support alternative proteins through public funding of open-access research and rules that ensure a level playing field.”
Meanwhile, GFI Associate Director of Science and Technology Dr. Erin Rees-Clayton says funding opportunities for alternative protein research were inadequate before the pandemic. “However, if this catastrophe has awakened governments, philanthropies and corporations to the potential economic, global health and environmental benefits of a food system founded on alternative proteins, then we could witness an increased investment in alternative protein research.”
“Scientists and researchers around the world have had limited access to their labs and research facilities. Although lab experiments cannot be conducted from home, it is possible to review data, research the latest publications in alternative protein and plan out experiments that can be done upon returning to the lab,” Dr. Rees-Clayton explains.
An inflection point?
Spanish-based start-up Heura recently celebrated its third anniversary and the company revealed a “450 percent growth year-on-year being the fastest-growing plant-based meat start-up in Europe.”
The company is highlighting its plans to disrupt the current food system for good. “We can proudly say that we have already saved 276,643 animals and over 3.6 million kg of CO2 emissions, the equivalent to drive the earth circumference 375 times,” says CEO Marc Coloma..jpg)
Marc Coloma, CEO and Bernat Añaños, Co-Founder of Heura.
Regarding the recent statements made by the GFI, Bernat Añaños, Heura Co-Founder tells FoodIngredientsFirst: “Bruce Friedrich (Co-Founder and Executive Director at GFI) is a point of reference for us and all the work he has done and keeps doing with his team at the GFI to help industry is at least, admirable.”
“Their efforts to boost the plant-based transition are latent and they want to make sure everyone in the community keeps moving forward. We all together will make it happen: little vegan stores, start-ups, investors, multinationals, institutions and governments,” Añaños continues.
The pandemic will be “an inflection point,” he notes. “It has affected our foodservice distribution and modified our expansion plans. The good news is that we have diversified distribution channels, both nationally and internationally, that allow us to keep delivering Heura around the world by retailers and restaurants which offer delivery.”
Nevertheless, in general terms, the coronavirus outbreak will affect consumption habits, he adds. “It is clear that looking after the planet is the only way to keep our own health in good stead,” Añaños stresses. “And at the moment, there isn’t a more sustainable, healthier and impactful way to do this than transition from animal proteins to plant-based ones,” he remarks.
For Añaños, the right information is vital. “The negative impact of eating animals on our health and sustainability of the planet is still very unknown,” he continues. “Everyone knows the sustainable impact of taking a plastic bag to the supermarket, but few people know that just by eating a plant-based burger over a beef burger could save the water of 26 showers and the emission of six laps at Barcelona’s montmelo racetrack by car. Governments and media could help by bringing up awareness of the issue for a public and responsible debate,” he adds.
Irish-based fiid, offers hearty plant-based meals, pegged for their ambiance and shelf life. Finding comfort in plant-based foods
Meanwhile, as the COVID crisis continues to see an influx of grocery sales, Irish-based fiid, offers hearty plant-based meals, pegged for their ambiance and shelf life. Founder, Shane Ryan, believes that COVID-19 could trigger a resurgence of ambient foods, starting with kitchen staples.
“I think in times of crisis, consumers look to food as a form of comfort,” Ryan tells FoodIngredientsFirst. “What we saw from our community initially was an immediate abandonment of diets as the pandemic escalated with people at the very least becoming much more flexible around what they are eating.”
“A much-needed renaissance of the category as a whole could be seen as consumers start to value the benefits of ambient products again. The COVID-19 pandemic and subsequent rush to stockpile has served as a reminder to consumers of the versatility and dependability of the category,” he notes.
For specific categories of plant-based food, this may have posed challenges on the demand side. In fiid’s case, Ryan says the company was careful not to position fiid in the market as a vegan brand. “The vast majority of our customers are not vegan. Instead, we focused on promoting the solution we were providing [the convenience factor] and the great taste and nutritional quality we are providing. Despite the COVID-19 situation, food has continued to resonate with consumers who are now prioritizing comfort and taste above all else.”
Shane Ryan, Founder of fiid, believes that COVID-19 could trigger a resurgence of ambient foods, starting with kitchen staples.
According to Ryan, fiid’s 18-month old business has seen “unprecedented sales so far this year,” bolstered by the nature of its products having a 12-month shelf life, meaning they are in a “unique position to offer customers the ability to stock their cupboards,” he remarks. The company also saw retail sales grow 100 percent in March, with a 434 percent increase in online sales (through their e-commerce site alone), reveals Ryan. “This triggered the issue of maintaining supply and ensuring that we were able to fulfill orders to existing and new customers.”
“We’ve been fortunate in that the business has grown since the pandemic began because, as a young brand, we don’t have huge cash reserves to carry us through,” he explains.
As the crisis has continued, there has been a renewed focus on health in general, according to Ryan, following the initial shock. “Plant-based foods play a large part in that for many people. The plant-based trend isn’t going anywhere,” he further contends.
Meanwhile, the perceived health benefits of eating plant-based is a considerable driver as well as people’s growing awareness of climate effects. “These aren’t concerns that have disappeared among the general population, so as we start to adjust to our new reality, I think people will start to refocus on other things again – namely looking after their health,” concludes Ryan.
By Elizabeth Green
