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Why the meat industry will (have to) change dramatically

Beyond Meat is standing out. The stock of the producer of plant based meat substitutes is up more than 600 percent since it´s debut this May. This is in stark contrast to the mixed IPOs from highly anticipated Uber and Lyft. So far investors are more enthusiastic about the revolution of meat than transport. And there are good reasons to that.

The global market for processed meat is estimated at 1 trillion USD and about to grow to 1,5 trillion USD by 2022 (Zion Market Research) thanks mainly to a growing number of consumers in Asia being able to afford more meat dishes. This market is served by a meat industry that has hit a efficiency wall. More animals per square meter, more efficient feeding and antibiotics, higher meat content per animal – all those efficiency gains have limits. It is just highly inefficient to produce proteins by feeding animals and killing them:

  • US beef production takes 40 percent of the agricultural land to produce just 3 percent of US calories
  • It takes more than 15.000 litres of water to produce one kilogram of beef meat
  • Beef production causes 10 times the CO2-emissions per kilogram of rice or potatoes and 25 times that of lentils

These numbers scream: There´s got to be a better way of producing protein. And as those numbers have been public for long, only now are there serious efforts to bring plant based meat products to the market in scale. You can argue what exactly is driving the demand for meat alternatives. But the global awareness for climate change and the scale of animal suffering has had an impact.

Of course, the stratospheric stock price movement of Beyond Meat is mirroring a lack of supply of stocks associated with that topic. But when big conglomerates like Nestlé (here) and Cargill (here) and Tyson Foods (here) are stepping in, it seems they expect a much bigger market for alternative meat products than vegan teenagers marching through the streets of Europe on Fridays.