The US plant-based protein market has recorded strong growth in recent years. The growth is primarily backed by the rising flexitarian trend, adoption of vegetable diet, and vegan meals due to the increasing health consciousness and evolving veganism among a large US population.
According to ConsumerIntel360's Q2 2020 survey, plant-based foods market is growing at over 15% (annualized basis) in the US. The market growth is offering an attractive business and investment opportunity for food manufacturers ranging from leading CPG companies to meat producers. Moreover, future growth prospect of the market is attracting startups to participate in the market. It is expected that innovative products using new ingredients will drive the future growth of the market.
The ongoing coronavirus pandemic (COVID-19), is becoming a rising concern for global socio-economic stability.
The conventional meat processing companies are facing several challenges to run their business. In April 2020, meat processing companies such as Tyson, National Beef Packing, and JBS USA had to close their many plants due to some of their employees got sick by the virus. Notably, the closure affected Tyson to lose 25% of its total meat production. The availability of meat and meat products has been affected.
Additionally, consumers are avoiding animal products due to fear of getting infected. Hence, the shortage of conventional meat and consumers’ sudden affection to the plant-based meat is helping the plant-based meat sector to record rising demand.
In the plant-based protein market, innovation is truly necessary to sustain in the business. Consumers’ inclination towards plant-protein is rising due to the more health benefits and same taste these alternative proteins are offering. Therefore, companies are keen to find ingredients which can be alternative to conventional protein sources and match consumers’ preference.
The demand for hemp seeds is rising as a complete source of protein and contains essential amino acids. Due to high growth potential over medium to long term, start-ups are entering the plant protein market by creating a niche in hemp-based protein products. Pea protein is gaining market share in the US plant-protein industry. This is primarily due to high protein content and several health benefits it offers. Additionally, the use of pea protein is increasing in dairy, bakery, and other food and beverage processing markets as an alternative to other plant-based protein such as soy. Companies are therefore focusing on new product development using pea protein.
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