KANSAS CITY, MISSOURI, US — Every now and then a food consumption trend comes along that shakes the grain processing industry to its core.
Earlier this century, it was the Atkins low-carbohydrate diet that emerged as a credible threat to the flour and baking industries. Fortunately, it was wildly popular for only a relatively short period of time and did not have a significant, long-lasting impact on demand for enriched flour. Despite an onslaught of negative publicity, including the publication of books rife with misinformation such as “Wheat Belly” and “Grain Brain,” enriched flour demand bounced back as many consumers decided that low-carb diets were not sustainable.
The latest trend of this ilk, one that could negatively impact the meat, feed, and grain industries, is the consumption of plant-based protein as an alternative to animal-based protein. Plant-based protein foods, such as hamburgers made from soy and chicken nuggets derived from peas, appear to be gaining favor for several reasons. Plant protein is being portrayed as a healthy alternative to animal protein (although there is conflicting evidence on that front) as well as environmentally friendlier as critics point to the higher amounts of greenhouse emissions involved in animal protein production. There’s also the practical economic matter that if plant protein becomes more mainstream, it could become less expensive than animal protein, particularly beef and seafood.
According to marketwatch.com, the global plant-based protein market, valued at $16.45 billion in 2018, is expected to reach $40.53 billion by 2025 with a compound annual growth rate of nearly 14% over the forecast period. A separate report from Research and Markets shows global animal feed growing at just under 5% from 2020-26.
Will the plant protein trend have staying power, or will it fade like the Atkins craze did after a short surge in popularity? Much innovation is happening in the alternative protein field, whether it’s plant-based or through a fermentation process, and there is significant investment. But while some will decide to forgo meat in favor of plant-based proteins for health and/or environmental reasons, many others will make their decision based on how the two products taste. The Atkins craze was short-lived because many consumers preferred the taste of enriched flour products over whole wheat flour products or abstaining from flour products altogether. Don’t be surprised if the plant-based protein craze follows a similar path, with many consumers trying it but ultimately switching back to the arguably tastier and more traditional meat-based protein.
A far more concerning trend, particularly from the perspective of the corn and ethanol industries, is the push for electric automobiles. Once a futuristic concept, electric-powered vehicles may become the rule rather than the exception within the next 15 to 20 years. Norway, for instance, plans to ban the sale of fossil fuel cars by 2025, and in the United States, California has banned the sale of new gasoline-powered vehicles beginning in 2035. It will be fascinating to see the powerful oil and biofuels lobby groups squaring off against the progressive politicians on this issue in the coming years.
As for now, all the animal protein, feed and grain industries can do is take a wait-and-see approach regarding these trends and prepare to adapt their business models in whatever way necessary.