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(R)evolution: A Product Roadmap for Alternative Proteins
“Revolution is obstructed evolution.”
– Myrtle Reed
Few events have had greater impact on human progress than the Industrial Revolution, the period marked by the shift from agrarian and manual labour economies to a machine manufacturing-dominated one, which ushered in a wholesale change in societal organization. The ensuing economic transformation altered both how people related to each other and to the planet. What began with the onset of the steam engine and mechanisation in the late 18th century (Industry 1.0), progressed to mass production with machines running on electricity at the start of the 20th century (Industry 2.0), followed by advances in the electronics industry with the invention of transistor and integrated circuits in the late 20th century (Industry 3.0) and has today expanded into digital networks, big data, robotics, machine learning and artificial intelligence (Industry 4.0). Through many centuries of consistent and relentless progress, it has been a fascinating journey to say the least. Our food system is poised for a similar transformation with the advent of alternative proteins fuelled by advances in biotechnology. While greater productivity was the key driver behind industrial revolution, the food revolution spans sustainability, nutrition, animal welfare and climate change. We are only in the early stages of this latest chapter, which will radically transform our food system by mid-century, when the planet’s population reaches nearly 10 billion.
Taste, price and convenience form the trifecta of key consumer drivers of interest in alternative proteins. Approximately 67% of Americans say that they would eat more plant-based foods instead of meat if it tasted better, cost less than the meat options and were more accessible.1 Plant-based options are currently priced at a premium – plant-based dairy is priced at ~12% premium to conventional dairy, plant-based meat is on average priced 43% higher than conventional meat, and plant-based eggs still eclipse the price of conventional eggs.2 While consumers rate plant-based meat better on fibre, fat and cholesterol content, they rate it less favourably on taste, protein, iron and overall nutrition.3 From an accessibility standpoint, plant-based foods are readily available in most developed economies, but they are still making in-roads into developing nations. By contrast, products made using precision fermentation and cultivated meat technologies are yet to make their way to consumers in any meaningful way. Perfect Day and Remilk are the only two precision fermentation companies to have obtained GRAS approval for selling their whey protein in the United States. Likewise, Good Meat remains the only company in the world to have obtained regulatory approval to sell its cultivated chicken products in Singapore. As the sector advances, we will see products get continually more sophisticated, each successively unlocking a new segment of consumers. While the industrial revolution took several centuries, alternative proteins will transform our food system in just a few decades. The culmination will be alternative proteins becoming mainstream, when they will no longer be termed “alternative”. We see four stages in this transformation. Let’s examine each, starting a decade ago, when a new set of products emerged.
STAGE #1: SIMULATED PRODUCTS (~ 2010s)
The first stage of the alternative protein industry has been focused on creating ‘Simulated’ animal products when it comes to taste, texture, price and nutrition. These products mimic their conventional counterparts better than ever before, but don’t quite hit the mark for consumers. As a result, these simulated products pique the interest of only the early adopters, and are yet to make inroads into the early majority. There has been a stark divide in the sensory profiles of the simulated products compared to conventional products. Impossible (with burgers that bleed and cook like meat) and Oatly (with milk that foams and tastes great in coffee) engaged consumers with products far better than their previous counterparts, but still left consumers wanting for more. We see products today only in limited categories such as plant-based burgers and milk that were the early targets of alternative protein companies because these products were more tractable. In Asia, while plant-based alternatives have been a part of most diets for ages (e.g.: mock meat, soy milk), these products belong to an independent category and have not been looked upon as substitutes of animal products. Further, although the products tried to bridge the sensory gap, they were formulated using a long list of ingredients. Supply chain constraints didn’t help, which offered a limited set of protein ingredients – soy, pea and pulses – to aid product formulation. In addition, lack of infrastructure, high cost of inputs, low yields, and a nascent distribution network also hampered growth.
STAGE #2: IDENTICAL PRODUCTS (~ 2020s)
We are now entering a stage in which we will see products that consumers will be unable to tell apart from their conventional counterparts. In this ‘Identical’ stage, we will see alternative protein products indistinguishable from meat, seafood, diary and eggs, or at least preferred by a large segment of consumers. Advancement of the alternative protein industry has accelerated over the past few years which has enabled a new generation of products, including novel protein sources (e.g., microalgae, mycoprotein, food crops such as lupin, rapeseed), technological advancements to improve yields and minimise the ingredient list, R&D improvements to enhance the sensory profile, better infrastructure, increased volumes and better distribution. Further, as fermentation and cultivated meat technologies come online, the industry will also have the advantage of utilising multiple technology stacks to accelerate the next stage in its product development roadmap. The result will be products that are identical to conventional meat for the consumer palate. In contrast to their “Simulated” counterparts, alternative protein products during this stage will mimic the microstructure of conventional meat. This will position the industry for mainstream adoption. The industry would then not only appeal to the 42%4 global flexitarian population, but the remaining omnivores would also start to take notice.
STAGE #3: ENHANCED PRODUCTS (~ 2030s)
Having matched the animal products industry in taste, price and convenience, where will the industry go next? We believe innovators will then seek to eliminate the “imperfections” of animal products, particularly in nutrition. These ‘Enhanced’ products will effectively give consumers an opportunity to have their cake and eat it too – the same taste, at the same price, but with better nutrition, all while being good for animals and the planet. Imagine meat with less cholesterol and saturated fat, but with added fibre, vitamins and minerals. Is it possible, for example, to create a product that tastes “meatier than meat”? We believe this is exactly what will happen. Far from perceiving conventional products as the holy grail, the industry will move towards leveraging its three key technology stacks – plant-based, fermentation and cultivated – to create “hybrid” products that not only meet consumer expectations when it comes to taste, texture and price but are nutritionally superior to their conventional counterparts.
STAGE #4: NOVEL PRODUCTS (~ 2040s)
A new level of innovation will manifest in the ‘Novel’ stage. Advances in molecular genomics, tissue engineering, food science and processing technology will enable us to combine food “bottoms-up” from a molecular level for a personalised experience. We will be able to create products never dreamt of before, products that are truly novel. This may include products that fuse pork and chicken cells or ones with molecules and flavour formulations that trigger specific feelings. During this stage, companies would have developed granular expertise on food ingredients. While it is hard to visualise what the fourth stage of the food revolution would like, we believe that akin to advancements in the computing revolution, this stage will be game-changing, or should we say food-changing! Although the first generation of computers can be traced back to the 1940-1950s, the changes with the greatest impact in the computer revolution occurred in the fourth generation with the dawn of the personal computer industry in the 1980s. During this time, technology developed to a point where manufacturers could place millions of transistors on a single circuit chip. The product development roadmap will be intended to empower humanity to address challenges as diverse as food security, sustainability, nutrition, emissions and environmental issues. This will be food on demand at the fingertips of consumers akin to the computer or the mobile phone that so many say they cannot live without.
EVOLUTION TO REVOLUTION
The Industrial Revolution began in England and then spread to the United States towards the end of the 18th century. By the mid-19th century industrialisation was well-established throughout Western Europe and North America. Additional regions including Russia, Japan, Eastern and Southern Europe, Australia, and New Zealand began to industrialise by the early 20th century as well. The “Asian Tigers” (Hong Kong, Singapore, Taiwan, South Korea) rapidly industrialised by the mid-20th century before industrialisation reached the rest of the world. We can draw some key inferences from the geographical progression of the Industrial Revolution: i) wealthy nations industrialised first, ii) hubs which were at the forefront of innovation saw an earlier onset of industrial revolution, iii) connectivity played a crucial role – countries with ties to England industrialised faster, iv) countries where the government in power was committed to the advancement of revolution also saw accelerated industrialisation.
While technology and global connectivity have since erased many first-mover advantages that early movers enjoyed during the Industrial Revolution, we can nonetheless draw parallels with the food industry. Three developed economies – United States, Israel and Singapore – are at the forefront of the food technology revolution. Innovation and government support have been the major contributors. As the industry advances, we expect other hubs to emerge, leveraging technology transfer from existing players, support from local governments and domestic innovation to meet the demands of the local population.
Similar to the Industrial Revolution, the evolution of the food industry will also be marked by significant, ongoing technological innovation. Plant-based technology saw rapid advancement during the ‘Simulated’ stage, while fermentation and cultivated meat technologies are now coming online in the ‘Identical’ stage. The ‘Enhanced’ stage will see the three technology stacks being combined to create products that have an enhanced taste, texture and nutrition. The culmination of the transformation of our food system will bring ‘Novel’ products that challenge consumer imagination and palates. The journey has only just begun!
Yale Program on Climate Change Communication