The shifting consumer eating habits, driven by the enhanced awareness towards environment, climate change, animal welfare activism, and holistic approach towards diets has led to the rise of veganism around the world. Currently, 1.1% of the global population, approx. 88 million people are vegans, and the number is expected to increase significantly in the coming years. In Veganuary 2023, over 700,000 people from 228 countries and territories officially signed up globally while 400 US businesses participated in the event, breaking all previous records. From celebrities to athletes and big tech companies are supporting the movement to eat more plant-based foods. Vegan diets have been around for a very long time around the world, despite occasionally being seen as a privileged Western movement. Countries such as India, China, Japan, Greece, Jamaica, and Israel have a large vegan population due to ingrained cultural traditions and religious beliefs. With now more and more people opting for a vegan lifestyle, food manufacturers are capitalizing on the growing opportunity and providing more vegan products on our supermarket shelves.
Plant-based Foods Take Market by Storm
When health and well-being started becoming priorities, consumers started reassessing what they eat and their impact on the environment. This was the year when everyone learned about plant-based, and new goods started to arrive on the market, including pizza, lattes, dirty burgers, and bakeries and pastries. In 2021, the sales of plant-based foods grew faster than the overall food sales, according to a study conducted by the Good Food Institute. Now consumers can find plant-based alternatives, everything from vegan meat to vegan milk and cheese through mainstream grocery stores. Already plant-based and dairy alternatives account for 8% of the global “protein foods” market.
Vegans are no longer settling for substandard meals of french fries and side salads. Many vegan food outlets such as PLNT Burger, Hart House, Vegan vs Fries, Loving Hut, Flower Burger, Veganburg, Blaze Pizza, HipCityVeg, etc. have been emerging, providing more food choices for vegans. Besides, popular fast-food chains and restaurants are rolling out enticing vegan meals in their options to meet the evolving demands of consumers. For instance, two of the biggest fast-food restaurants in the U.S., Chick-fil-A and Mickey Ds are hopping on the plant-based bandwagon, offering dishes that resemble chicken but are made without chicken. Burger King started selling its plant-based burger, Impossible Whopper in 2019 while its competitor McDonald’s debuted its McPlant burger—developed with Beyond Meat—in the United Kingdom in 2021. Even KFC, widely renowned for their chicken offerings started selling Beyond Meat nuggets in 2022.
According to a survey conducted by Food Labs, restaurants that have added vegan food options have witnessed 13% increase in customer traffic and availability of options has led to a 300% increase in vegan food orders. Aramark, a major foodservice provider in United States has adopted a vegan culinary training programme to assist cooks in mastering plant-based cookery. Aramark is in charge of the food supplied in schools, hospitals, corporate cafeterias, and other locations. The action fits with the company's goal of providing more vegan foods that are heart healthy.
As more cafes and restaurants build their business models to not only accommodate vegan customers but also to deliver delectable vegan food items, vegan burgers, pizzas, and coffee are gaining more popularity than ever. The availability of meat and dairy substitutes has made it simpler for restaurants to serve a variety of vegan cuisines. Restaurants are not only serving vegan dishes, but they are also advocating for a sustainable and environmentally friendly lifestyle. Through vegan cuisine options, restaurants are investing in providing customers with an environmentally responsible experience.
According to TechSci Research report on “Vegan Chocolate Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, 2018-2028F Segmented By Type (Dark Chocolate, Milk Chocolate, and White Chocolate), By Category (Boxed, Bars, Countlines, and Others (Pouches & Bags, etc.)), By Distribution Channel (Supermarkets/Hypermarkets, Convenience Stores, Specialty Stores, Online, Departmental Stores and Non-Retail) By Region, Competition”, the vegan chocolate market is projected to grow at a significant rate. The growth can be attributed to the rising health awareness among consumers regarding the benefits of consuming plant-based foods and rising cases of food-related allergies.
Rise of Vegan Food Startups
The days of vegetarians and vegans having few food options are long gone, thanks to a plethora of new vegan cuisine entrepreneurs. Growing consumer demand for vegan food products has dramatically increased investor interest in the sector. Globally, there are currently 640 vegan food companies. Impossible Foods and Beyond Meat, two California-based companies that produce fake meat, helped make vegan burgers popular and paved the way for related developments like vegan seafood.
Here are some of the food tech companies revolutionizing the vegan food industry.
Fish consumption is being revolutionised by Israel-based vegan food tech startup Plantish at a time when the demand for seafood is at an all-time high. For individuals looking to have as little influence on the environment as possible, Plantish is working to develop fish and seafood analogues made from plants. In January, they debuted their first item, a whole-cut vegan salmon fillet. The novel "fish" product prioritises a typical - and delectable - salmon experience without taking a heavy environmental toll.
US-based plant-based food ingredient manufacturer, Benson Hill offers sou flour, baked goods, meat extension, and other functional alternatives to meat and dairy products. Combining AI technologies such as data science and machine learning with biology and genetics, the company develops ingredients with optimized nutrition and flavour. In August 2022, Benson Hill entered into a strategic partnership with global nutrition company, ADM to diversify its soy ingredients and venture more into plant-based savory, sweet, and dairy items for meeting evolving needs of consumers.
Sweden-based food tech company, Oatly uses patented enzyme technology to produce dairy products from oats. The company's unique enzyme technology mimics a natural process that transforms high-fiber oats into nourishing liquid nourishment that is designed for people. The first step includes crushing oats in hot water to expand the starch found in oats. The next step involves mixing natural enzymes with the oat starch in the enzyme tanks. The subsequent breakdown of the oat starch into smaller components, such as maltose or malt sugar serves as a natural sweetener. In 2021, Oatly collaborated with Deutsche Bahn to offer the Oatly Barista Edition as the first plant-based dairy replacement product in the intercity trains. This helped to provide the passengers an experience of plant-based milk alternative. In 2022, the company expanded its partnership with Espresso House, wherein coffee is made with oat milk.
US-based food tech company, Eat Just leverages innovative tech to make eggs using mung bean protein isolate. The isolate is combined with expeller-pressed canola oil and natural extracts of carrot and turmeric. Mung beans use 98% less water and 84% less land than what the production of traditional chicken eggs require. The finished product is non-dairy, cholesterol free and is non-GMO. In 2022, Eat Just partnered with Mikey’s and Crepini to launch plant-based breakfast pockets and eggless wraps for consumers. The same year, Eat Just launched its first-ever 100% plant-based menu in collaboration with Caribou Coffee, one of the largest coffeehouse chains in United States. Just Egg garnered an “People’s Voice Winner” under the Food & drink category at the Webby Awards in 2022.
Chile-based food tech startup, NotCo leverages AI-based Giuseppe technology to replicate animal products using 100% plant-based components. It accomplishes this by identifying plant-based substitutes for animal proteins among the thousands of accessible ingredients. Giuseppe starts by formulating a number of potential recipes that are similar to the product that the company wishes to copy. The process then looks for similarities across a range of properties, including flavour, appearance, nutrition, and function. In 2022, LSG Group collaborated with NotCo to expand its offering with plant-based meals using the firm’s components. In 2021, NotCo had partnered with the Kraft Heinz Company to build plant-based aversions of co-branded items that match demanding preferences of customers.
Investments Pouring in Vegan Food Brands
Venture capital firms are investing heavily in vegan startups. Not just businesses are eager to profit from the plant-based food industry. Tech billionaires, athletes, and celebrities have all made sizeable investments in businesses like Impossible Foods and Beyond Meat, and many more are continuing to do so to support the expansion of new businesses.
Leonardo DiCaprio, American actor well renowned for his environmental activism has opened Neat Burger, a network of vegan fast-food restaurants. Additionally, he has invested in Beyond Meat, Califia Farms, and the British vegan business HIPPEAS for chickpea puffs. Additionally, DiCaprio serves on Perfect Day's sustainability committee as a supplier of plant-based dairy ingredients. Natalie Portman, American actress has financed Boston-based start-up Tender Food, which produces whole muscle cut plant-based meats. Portman is previously an investor in Oatly and the vegan bacon firm La Vie. The start-up's use of spinning fibre technology enables it to produce a texture that is comparable to that of animal meat. In the seed round, Tender Foods raised £12 million (USD15 million), which it would utilise to boost production and broaden its product offering.
Plant-based dairy and meat start-up, NotCo achieved unicorn status after receiving funding of USD235 million from Amazon founder, Jeff Bezos. Chris Smalling, a former Manchester United player, established the venture capital firm ForGood in 2022. The VC firm only finances entrepreneurs and start-up businesses addressing important environmental issues. The company has already supported a number of well-known food brands, including allplants and Matthew Kenney Cuisine. After investing in the plant-based business THIS, which won the Food Matters Live 2020 Awards, Smalling made an investment in the Spanish vegan meat firm Heura in June 2021. American Rapper, Jay Z backs dairy-free cheese brand Misha’s Kind Foods through his company Marcy Venture Partners.
Robert Downey Jr.’s venture capital firm FootPrint Coalition poured USD15 million in seed funding in Israeli food tech startup Chunk Foods, which would be utilized to construct one of the largest plant-based whole-cut meat factories in the world.
Increasing acceptance of veganism by celebrities has a crucial role to play in promoting the lifestyle among masses. Celebrities like Billie Eilish, Ariana Grande, Jason Marz, Zac Efron, Beyonce, Bill Clinton, Madonna, Natalie Portman, Jessica Chastain, Ellen Pompeo, etc. are promoting vegan diet culture and people have shown acceptance, which has added to the rising adoption of vegan foods.
The elite of Silicon Valley are beginning to see that animal agribusiness is the fundamental problem with our food system and that it needs to be drastically changed. Venture capital firms have invested billions in food technology businesses over the last few years, helping them to create cutting-edge new products, some of which are plant-based. Millions of dollars are being staked on businesses like Beyond Meat, Hampton Creek, Impossible Foods, Lyrical Foods, Muufri, Modern Meadow, and others to create the foods of the future by companies like Obvious Ventures, Google Ventures, Khosla Ventures, SOSventures, and Horizons Investors.
Technologies Used for Vegan Food Production
A major shift in interest in the alternatives to traditional animal proteins has been witnessed due to availability of a wide range of meat and dairy products. Plant-based foods are not just restricted to soy as new technologies are enabling market players to create new and innovative products that are now rapidly becoming mainstream. According to Plant Based Foods Association, the plant-based protein alternatives pegged USD7 billion in sales in the United States in 2020 as more products with better texture, taste, and nutrition forayed into the market. For encouraging the greater adoption of plant-based protein alternatives, food tech companies are investing for increased research to understand the relationship between the chemical, physical, and functional properties of plant ingredients. More R&D is focused on the manufacturing new alternative proteins leveraging advanced technologies.
To make their products as realistic as possible, many contemporary plant-based meat companies, including Beyond Meat and Impossible Foods, have made significant investments in R&D and technology development. Soy leghemoglobin, a crucial component that gives Impossible Foods' meat alternatives their distinctive meaty flavour and the ability to "bleed," is created using a genetically modified strain of yeast. Beyond Meat uses a food extrusion machine that was initially created at the University of Missouri to produce its Beyond Burger product. This machine uses heat and pressure to crush plant proteins into a fibrous, meat-like texture that resembles muscle fibres. The Beyond Meat burger uses beetroot juice to mimic the bleeding from a real burger rather than employing genetic engineering to make its products.
Here are some of the technologies being utilized by food tech companies to introduce more healthier and tastier vegan products into the market.
The extrusion technology is used to create plant-based meat and seafood textures just like the original ones. During the extrusion process, protein structure is altered by thermal and mechanical stresses, which leads to the formation of soluble and/or insoluble aggregates. Altering the protein structures with high-moisture extrusion process can lead to a wide range of final product characteristics. Changing the independent process parameters such as barrel temperature, screw speed, and configuration, process conditions can be varied, which improves the flexibility to a certain extent. Twin-screw extrusion has recently been a popular method for wet texturization, which combines a number of chemical and physical processes (such as die fibration and thermomechanical cooking) to give the finished products a more meat-like texture and fibrous structure. The utilisation of a wider range of proteins as well as additional ingredients like starches, fibres, and additives is made possible by proper pre-treatment. The extruded mass is subsequently processed using forming units (additional plasticizing devices) in a separate processing stage, where it is cooled, united, textured, and/or moulded into strips, patties, or other shapes. Proteins with high moisture content are typically processed and packed in wet form (pouches, cans, or frozen). For instance, French startup Umiami offers a novel extrusion technology that delivers more thicker, realistic horizontal, diagonal, and vertical cuts of plant-based proteins. Motif FoodWorks, a food tech company boasts extrudable fat technology that mimics animal fat in plant-based meats. The technology allows better integration of fats and proteins to create a better ingredient, which mimics marbelized piece of meat with better flavour release, texture, taste, and moisture.
The use of genetic engineering technologies to produce new proteins and enable the manufacture of substances typically derived from animals has significant potential. The genetic engineering technologies uses genetically modified microorganisms such as yeast, bacteria, or algae to produce plant-based foods. In order to produce casein and whey, which are typically found in cow's milk, Perfect Day uses recombinant technology to introduce DNA sequences into microflora like yeast, bacteria, and fungi. As a result, the business is able to produce dairy products that are vegan yet still include all the same proteins as their counterparts made from animal sources. Similar steps are being taken by Clara Foods, which produces vegan egg white proteins from genetically modified yeast. In addition, genetic engineering techniques like CRISPR and TALEN could be used to develop crops that are more suited for the production of plant-based meat by increasing their protein content, reducing their off-flavours, and so on.
3D printing is taking food companies by storm. The technology has opened new opportunities for food tech companies foraying into the vegan food industry. Emerging startups are not only recreating meat but driving the change with 3D printing and bioprinting technologies. For instance, Hong Kong technology startup Alt Farm has introduced 3D printing food from plant proteins through a patented nozzle design that recreates specific textures. The company utilizes plant-based ingredients such as pea, soy, and algae proteins to mimic animal meat. The current 3D printing technology takes up to four hours to print steak, but more R&D could lead to scaling technologies and production capabilities. Spanish startup, Novameat employs biomimetic micro-extrusion technology and custom 3D printing to recreate the tissue structure of muscles. European Union-led research project, Revo developed a 3D printing technology to replicate seafoods, primarily salmon and tuna products.
In the plant-based meat industry, technology is developing swiftly, and the coming years may be crucial in determining whether plant-based meat can overtake the USD1 trillion global meat market.
Vegan Food Market Trends 2023
- Plant-based Seafood Gains Momentum
In recent years, the consumption of seafoods has increased significantly, mainly driven by the increasing health consciousness among consumers and negative impact of meat cultivation over the environment. Compared to animal meat such as beef, pork, chicken, etc., seafoods contain high-quality protein, omega-3 fatty acids, and essential vitamins. However, rising pollution in oceans, unsustainable fishing practices, rising ocean temperatures, and excessive fishing have led to scarcity of quality seafoods. Hence, people are switching from traditional seafoods to plant-based seafoods that provide a similar flavour and taste to consumers. Some of the common ingredients found in plant-based seafoods are fava beans, soyabeans, peas, green lentils, etc. Using 3D printing technology, Revo Foods debuted its ultrarealistic whole-cut salmon fillet using pea and algae protein to capture the mouthfeel and taste of conventional salmon. Aqua Cultured Foods, US-based startup uses biomass fermentation to develop realistic alternatives to seafood varieties using mycoprotein calamari. Ireland-based food tech startup Sea & Believe offers whole-cut fillet using native Irish seaweed with its new prototype cod development. Increase in the pressure on global food supply chain and rising prevalence of zoonotic diseases are also expected to fuel the vegan seafoods market.
According to TechSci Research report on “Saudi Arabia Vegan Meat Market By Product Type (Tofu, Tempeh, Textured Vegetable Protein and Others) By Type of Sales (Institutional Sales and Retail Sales) By Region, Competition Forecast & Opportunities, 2028”, Saudi Arabia vegan meat market is projected to register and impressive growth. The market growth can be attributed to the rapidly rising demand from consumers for the alternative meat options in the country.
- Vegan Milk Exhibits Positive Growth
According to a report published by non-profit Good Food Institute (GFI), plant-based milks account for a significant 16% of the total share in the global milk industry, up from 12% in 2018. The popularity of plant-based milks is due to a variety of factors. Environmental concerns are also driving uptake of vegan and plant-based diets, with proponents claiming that plant milk has a lower greenhouse gas (GHG) footprint than dairy production - although the overall picture is highly complex, and the figures are disputed by the dairy industry. Environmental concerns are also driving uptake of vegan and plant-based diets due to health and moral reasons. Besides, the rising prevalence of lactose intolerance people in developed nations is also boosting the demand for vegan milks. According to the National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK), nearly 68% of the population around the world has lactose intolerance. Hence, manufacturers are introducing a wide variety of milk alternatives in different flavours to entice consumers. While dairy milk has traditionally been thought of as a beverage or a meal accompaniment, such as when used as an ingredient or with cereal, there are more and more indications that plant-based beverages, particularly those with a thicker, more yogurt-like texture or those sold in individual portions, are now being considered as a nutritious snack and treat.
- Rising Potential of Mushrooms for More Fungi Opportunities
Since Quorn introduced its initial product in 1985, fungi-derived protein (whether in whole mushroom form or as a by-product of fermentation) has advanced significantly. The fungal innovation expanded significantly when Quorn's patents on its mycoprotein production technologies expired. Compared to plant-based proteins, fungi have a number of benefits. To begin with, they may be produced quickly and in large quantities using biomass fermentation, which needs little in the way of resources and land. Secondly, without high moisture extrusion, the fungus naturally provides fibrous textures that can be used to mimic different types and cuts of meat. Additionally, some species, including chicken of the woods and lion's mane, can be grown to provide flavours that are similar to those of meat and seafood, whereas other businesses prefer to grow mycelium with a neutral flavour. Since fungi are high in protein, dietary fibre, vitamins, antioxidants, and minerals, food companies are also interested in their nutritional profile. Some of them have even categorised fungi as adaptogenic and are widely used as a component in a new generation of functional foods and drinks, such Fungtn's beer without alcohol.
- Vegan Cheese Becomes Mainstream
The types and availability of plant-based cheeses are expanding as a result of innovation in plant-based dairy substitutes. This has removed a long-standing barrier for flexitarians who want to give up dairy but just can't. Earlier, many well-known alternative cheese ingredients had little to no protein. However, manufacturers have started using more components with plant-based protein to better mimic dairy cheese. Between 2017 and 2021, the amount of protein in alternative cheese tripled, with chickpea, fava, pea, and potato protein taking the lead. 90% of the protein in ChickP's isolated proteins is from Israel. A chickpea component high in protein is also produced by the Israeli business InnovoPro for use in the creation of plant-based cheese. Mung bean, chickpea, and soy proteins are added to the cheese slices made by RIND, a manufacturer of cave-aged alternative cheeses in Brookyn, New York. Watermelon seed milk and sunflower seed milk will be used to make dairy-free cottage cheese, according to an announcement from Miyoko's Creamery. The manufacture of non-dairy cheeses is about to undergo a revolution because to precision fermentation. In the precise fermentation process, microorganisms are grown in nutrient-rich solutions without the use of animal products in order to generate whey, casein, or dairy fat that is bioidentical to those substances in cows' milk. Precision fermentation products do not need to be marked as bioengineered because they do not contain genetically modified DNA, and they frequently have non-GMO certification. In certain applications, the microbes themselves are grown and harvested as a source of protein rather than their by-products.
According to TechSci Research report on “Vegan Ice-Cream Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, 2018-2028F, Segmented By Flavor (Chocolate, Vanilla, Strawberry, and Others (Caramel, Blueberry, etc.)), By Product Type (Tub, Sticks, Cones, and Others (Carterton)), By Source (Coconut Milk, Cashew Milk, Soy Milk, Almond Milk, and Others (Rice Milk, Combination), By Distribution Channel (Specialty Stores, Convenience Stores, Hypermarkets & Supermarkets, Online, and Others (Dealers & Distributors Sales, etc.)), By Region, Competition”, the global vegan consumer market is expected to grow at a rapid pace. The market growth can be attributed to the rise in the number of vegan and diet-conscious consumers and increasing concerns about lactose intolerance.
Growing M&A Activities in the Vegan Food Industry
F&B players are looking to consolidate and expand existing positions to achieve economies of scale and reach new customers. A number of conventional food firms have employed bolt-on acquisitions to expand their product lines and customer offers in order to take advantage of the alternative protein possibility. Nestle, Dean Foods, Maple Leaf Foods, among others, are significant acquirers. These conventional food businesses profit from long-standing partnerships with grocery stores and downstream distribution networks. Corporates are primarily interested in buying young businesses to enter the market, add a trustworthy new brand, acquire defendable expertise, intellectual property, or new core competencies, secure supply stability, and/or develop a platform. Wilk, a British high-street retail chain has received USD3.5 million from Danone, Stakeholder Foods & Coca-cola Israel. Multinational joint venture PlantPlus Foods has closed USD100 million acquisition of Canadian vegan food Sol Cuisine to put a strong foothold across Americas. One of the world’s largest F&B company, Nestle has moved forward the acquisition of vegan meat company, Sweet Earth. In February 2023, Japanese company Morinaga Nutritional Foods acquired Tofurky and Moocho that would propel the company into a new stage of growth.
Vegan Alcohol-free Alternatives Shake up the Beverage Market
As people are realizing the harmful impacts of drinking alcohol, consumers mainly millennials and Gen Z are shifting to alcohol-free drinks. The alcohol-free drinks are rapidly becoming mainstream in bars and pubs around the world as more and more options are foraying into the market. However, vegans had difficulty in finding plant-based alcohol-free options, but not anymore. Many vegan beverage brands such as Seedlip, Gimber, Lyre’s, Nanny State from Brewdog, etc. are offering alcohol-free drinks. Many of these vegan alcohol-free spirits, beer, etc. are high in proteins when compared to other functional drinks made with dairy. In the coming years, more consciousness towards the health benefits of vegan drinks are expected to fuel their adoption.
Way Ahead
Vegan foods are leading a much-needed transition in agriculture, which is being supported by businesses that are attempting to upend our food chain by providing healthier, more sustainable meals as part of the fourth industrial revolution. The adoption and widespread use of meat, dairy, and egg substitutes, which will usher in a new era of post-animal agriculture, are at the core of this revolution.
According to TechSci Research report on “Vegan Food Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, 2018-2028F Segmented By Product Type (Dairy Alternative, Meat Substitute, Vegan Bakery, Vegan Confectionery, Others (include Egg Alternative, Plant-Based Snacks etc.)), By Source (Wheat, Soy, Oats, Almond, Nuts, Others (include Pulses, Quinoa, Brown & Wild Rice, etc.)), By Distribution Channel (Hypermarkets/Supermarkets, Convenience Stores, Specialty Stores, Online, Others (include direct sales, Distributor sales, etc.)), By Region, Competition”, the global vegan food market is anticipated to register growth at a formidable rate. The growth can be attributed to the surging popularity of plant-based products and growing awareness among the consumers.