Plant-based meat gets a reality check

• With inflation, fewer people are willing to pay a price premium. Paying more is a tough ask amid high food-price inflation. Willingness to pay a premium for PBA meat dropped 9 percentage points from last year and remained well below the number of people who say they would pay a premium for the best traditional fresh food.⁹ PBA meat producers believe they are on the path to achieving cost parity with animal meat, partly because animal meat prices are rising. But until they get there, price will likely continue to be a PBA headwind—especially for consumers who are less passionate about the product.
• Some assumed benefits are being questioned by consumers. Even buyers of PBA meat are changing their views on some of its attributes. The biggest change is in health perceptions. Many early adopters believed that the health benefits of plants would apply to all food products made from plants. Last year, almost seven in 10 consumers (68%) who had purchased PBA meat believed it was healthier than animal meat. But some of these consumers are changing their minds, as this year, the number dropped by 8 percentage points. A similar but smaller drop occurred with environmental sustainability, down 5 percentage points.¹⁰

To return to growth, PBA meat producers should explore ways to expand the addressable market, bring down relative costs, and create formulations that provide health benefits while maintaining taste. No easy task, but until then, a return to sustained double-digit growth could be hard to realize.

One thing that did grow rapidly over the past year is investments in plant-based protein from global venture capital and major consumer brands.¹¹ Perhaps resulting innovations can help ease the way forward and bring the market to the next level.