The South African plant protein market presents strong growth opportunities for both incumbents and new entrants. Increasing adoption of plant-based foods has led established players, foodservice start-ups, and retailers to shore up their respective offerings to cater to the demand from the millennial generation, and emerging flexitarian consumers.
The impetus to achieve food sustainability and a healthier planet as part of UN’s SDG goals will also contribute to sustained demand in this market. This burgeoning demand has also led to an increased interest in the space from investment firms.
The plant protein market in South Africa includes existing players such as AGT Foods, Archer Daniels Midland, Brenntag, Cargill, Roquette, SunOpta who have launched plant-based offerings in recent years to tap into the trend. The trend continues to global food giants, who have earmarked big investments with dedicated teams to develop and sell plant protein-based alternatives to meat and dairy markets.
Plant protein producers face stiff competition from established animal protein companies that currently offer a highly distributed, cheaper, traditionally acceptable, and tastier meat-based product portfolio.
Investment and innovation, wider presence, vegetarian/ vegan movements and awareness, influencers and appropriate messaging will give the plant protein market the required thrust, to expand its market share. The traditional animal protein companies continue to invest in expanding operations and, in some cases, have also earmarked funds for research and development into plant protein markets to hedge themselves. Additionally, private label products are gradually finding their customer base.
Expanding plant protein portfolio
Existing agricultural companies are expanding their portfolio to include more plant-based protein ingredients to help their clients capitalize on the emerging plant-based food trends. These offerings are expected to provide retailers, restaurants, fast food outlets, etc., with a wider range of options to cater to the evolving consumer trends. Cargill invested an additional US$75 million to propel PURIS pea protein production to meet surging market demand.
Competition is expected to intensify, driving the rate of innovation
Existing animal protein companies such as RCL Foods, Astral Foods, have a large consumer base and strong distribution network, and plant-based protein companies such as Fry Family Food and Beyond Meat have a strong presence in the market. With the traditional meat only players updating their food offerings to include plant-based alternatives and forming new partnerships with foodservice channels and retailers, the competition for existing plant protein-based companies is intensifying.
Additionally, with the growing market, ConsumerIntel360 expects the competition in the plant-based protein market to intensify over the short to medium term.
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