The Good Food Institute (GFI), an alternative protein research organisation, has released its 2024 State of the Industry reports, presenting a nuanced overview of the global alternative protein sector, encompassing plant-based foods, fermentation-derived proteins, and cultivated meat.

Despite a decline in investment levels within the alternative protein space in 2024, the reports highlight an overall increase in global sales of plant-based meat and dairy alternatives, alongside growing consumer interest in whole food options. The global plant-based market attained sales totalling $28.6 billion, a 5% rise compared with 2023 figures. Among these, non-dairy alternatives led with $22.4 billion in sales, a 5% increase, while plant-based meat analogues reached $6.1 billion, marking a 4% increase. Vegan yoghurt emerged as the third most popular category after milk and meat/seafood alternatives.

Europe led regional sales with $9.7 billion in plant-based meat, seafood, and dairy, followed by the Asia-Pacific region at $8.9 billion, and North America at $7.3 billion. However, the US market experienced some setbacks, with total plant-based sales falling by 4% to $8.1 billion. Within this, non-dairy milk sales declined by 5% to $2.8 billion, and meat and seafood alternatives dropped by 7% to $1.2 billion, though this rate of decline was slower than in 2023.

Conversely, the US market saw increases in specific segments: protein powders grew by 11%, tofu, tempeh, and seitan sales rose by 7%, and vegan desserts and baked goods experienced a 13% uplift. Plant-based egg sales also increased by 2% in retail, boosted by supply shortages of chicken eggs caused by avian flu. In foodservice, vegan egg sales surged by 28%, though plant-based protein sales declined by 5%, whereas non-dairy milk sales continued to grow, rising by 9%.

Price remains a significant challenge for the plant-based sector. Plant-based meat and seafood prices increased by 4% in 2024, compared to a 1% rise for conventional products, widening their price premium to 82%. The price gap for chicken and milk stayed consistent, but premiums increased for pork and turkey. Notably, increased beef prices narrowed the premium for plant-based beef alternatives to just 14%. The premium for chicken-free eggs decreased considerably from 317% to 110%. Consumer penetration also shows mixed patterns: while 59% of US households purchased a vegan product in 2024, this is slightly down from 63% in 2022. Specifically, only 13% of households bought plant-based meat or seafood, although 63% of these buyers repeated their purchases. Importantly, nearly all consumers of plant-based alternatives (96%) also purchase conventional meat products.

The investment landscape revealed a 27% decline in venture capital funding for alternative proteins, totalling $1.1 billion in 2024. Plant-based companies saw the steepest drop, securing only $309 million, a 64% fall from the previous year, reflecting investor caution towards products perceived as ultra-processed. Cultivated meat funding fell by 40% to $139 million, its lowest since 2019. In contrast, fermentation technology attracted increased venture capital, rising by 43%, buoyed by Meati’s $100 million Series C funding round, and also surpassed plant proteins in public funding levels.

Public investment remained stable at $510 million in 2024, supporting alternative protein development as governments in the US, Denmark, and the EU pursue net-zero targets and protein diversification. The Asia-Pacific region notably doubled its public investment in cultivated meat projects within the year.

Regulatory developments were mixed. Regulators approved novel food ingredients from precision, biomass, and gas fermentation, including cow-free casein and animal-free egg protein, marking progress for the industry. However, in the US, a potential policy change by Robert F. Kennedy Jr. could eliminate the Generally Recognized as Safe (GRAS) pathway, potentially hindering product approvals. Cultivated meat also faced significant legislative challenges: twelve US states proposed restrictions, with Florida and Alabama successfully enacting bans. California’s Upside Foods has filed a lawsuit against Florida’s ban, while other states, including Mississippi, have followed with similar legislation in 2024.

Despite these obstacles, cultivation meat regulatory approvals advanced internationally. Australian company Vow received permission to sell cultivated quail and foie gras in Singapore, Australia, and New Zealand. UK-based Meatly secured approval to market cultivated chicken for pets. Aleph Farms obtained clearance in Israel in late 2023. Furthermore, regulatory bodies in the EU, South Korea, and Thailand began reviewing cultivated meat applications.

The Good Food Institute commented on the regulatory outlook: “Although some uncertainty exists due to shifting political winds around the globe, more approvals are likely in 2025. These approvals will increase the number of cultivated meat products on the market while also generating new and more robust data on their safety and nutritional profile.”

These findings collectively portray a complex global alternative protein industry in 2024, characterised by rising overall sales, shifting regional performances, investment realignments, and evolving regulatory landscapes.

Source: Noah Wire Services