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Growth of India’s plant based meat industry
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Saturday, 14 May, 2022, 13 : 00 PM [IST]
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Sumel Ashique
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India’s food processing sector and meat substitute industry
According to the Annual Survey of Industries (ASI) 2018–19 conducted by the Ministry of Statistics and Programme Implementation (MoSPI); the output of the food processing sector was approximately $179.9 billion (Rs. 12,76,995 crore) contributing around 12.83% to total output in the manufacturing sector. The gross value added (GVA) for the food processing sector was around $30.0 billion (2.24 lakh crore) during 2019–20, which resulted in a contribution of 1.69% to the overall GVA. The ASI also states that approximately 20.05 lakh people were involved in the food processing sector during the survey period. The food processing sector is very lucrative as it permits 100% Foreign Direct Investment (FDI), through the automatic route.
However, 100% FDI under the sovereign approval route applies for retail trading and e-commerce for food products produced in the country. Primary industries of this sector include the processing of sugar, grains, edible oils, beverage, dairy products, fruits and vegetables, meat, and seafood. The built-in capacity and understanding of plant ingredients processing has encouraged Indian processors to develop plant-based substitutes over the past few year.
Current scenario
The global plant-based meat market valued USD 1630 million in 2019 which is expected to reach USD 3290 million by 2025, witnessing a CAGR of 12% (2020-2025). Increased number of vegan population, technology development, rising cholesterol-related health problems and sustainability remained the key drivers for the plant-based meat market. According to the Good Food Institute, about 63% of the Indians are likely to purchase plant-based meat regularly. The heavy use of antibiotics on animals is another key factor driving the consumer shift for plant-based meat. However, in India, the plant based meat is an emerging trend mainly in the food service channel (FSR).
At present, the market size of plant based meat in India is very small but is growing at a faster rate in urban cities. In the past few years, many start-ups entered the plant-based meat market selling through foodservice channels and online retail in India which include Ahimsa Food, Vegeta Gold, Vezlay, GoodDot Enterprises, Vegitein and The Vegan Eatery. An Indian Start-up, EVO, has developed egg dishes using lentil protein. These companies sell their products through e-commerce platforms as well. Leading ingredient players such as ADM are also assisting new entrants in Indian market in designing alternative meat products. Recently ADM partnered with Imagine Meats to offer plant based meat products. At present, the number of players in the market is less while the demand is accelerating, which provides opportunity for new players to enter the market.
Plant-based meat brief overview
Plant-based meat is basically meat derived from plants. It is manufactured to taste, look, and feel like traditional meat from animal products. Plant-based meat is heathier than regular meat as it is lower in calories and saturated fats. Coconut oil, vegetable protein extract and beet juice are some of the ingredients used in plant-based meat. Plant-based meat is healthier when consumed in moderation as part of a balanced diet. It also offers more nutritional benefits than regular meat.
Drivers of plant-based meat industry
According to Forbes, India is the largest producer of pulses in the world, accounting for 25% of the total output; however, more than 70% of the people in India are protein deficient. Deficiency can be caused by lack of awareness and less consumption of a sufficient amount of protein on a regular basis. India has an abundance of protein-rich food such as pulses, soybeans, legumes, seeds, nuts, milk, meat, fish, and poultry.
However, not all sources of protein are feasible for people across the country, which could be due to lack of awareness, affordability, and availability or because of cultural, ethical and health choices. Plant-based protein sources can play a vital role in treating deficiency as they not only offer varieties but are also pocket-friendly. A balanced diet combining two or more sources of plant-based foods can meet protein requirements in the human body.
Alternatively, consumers are very receptive to plant-based meat substitutes. Many consumers are demanding such products as they provide several health and fitness benefits such as prevention of non-communicable diseases, obesity, and digestive disorders.
Amid the Covid-19 pandemic, the popularity of these products has surged as they are being perceived as immunity boosting food products. Flexitarians, individuals, or a group that is vegetarian but tends to consume meat and fish occasionally, can relish the taste of animal meat without consuming animal products. Furthermore, urban consumers are welcoming the idea of plant-based processed food as a rich source of protein
Plant-based meat industry analysis
According to the United States Department of Agriculture (USDA) industry report, India seems to be a nascent market for plant-based meat substitutes. Indians have traditionally consumed soybeans, jack fruit, dairy, and pulses for protein. According to the UN Livestock Long Shadow Report, around eight out of 21 alternate meat start-ups were launched during 2019–20 and five international and domestic players forayed into this segment during 2020–21. India has emerged as the largest consumer base in the world, with a massive scale of urbanisation and transition in income group. As per a survey conducted by the University of Bath and the Good Food Institute in 2019, 63% of Indians were either very or extremely likely to buy plant-based meat daily.
India’s emerging plant-based meat market offers opportunities but hard work lies ahead
According to an OECD report published in November, India consumed six million tonnes of meat in 2020, or 4.6 kilograms a person. Nearly half of India’s population now consumes non-vegetarian meals once a week. However, at the same time, there is growing interest in the country for modern-style plant-based meat products.
The market in India is in its very early stages but is seeing expansion. According to Carmen Bryan, a consumer analyst at GlobalData, the meat substitutes market in India generated retail sales of $220.8m in 2020 and is expected to reach $292.9 million by 2025, clocking a compound annual growth rate (CAGR) of 5.8%. India’s market for plant-based meat is in its infancy but investors and entrepreneurs are, in the main, optimistic about the sector’s potential, even if there is some uncertainty about the real extent to which the market can grow.
India’s Plant-Based Meat Market – Major International Firms
- Archer Daniels Midland: Archer Daniels Midland (ADM) recently partnered with Imagine Meats, an Indian producer of plant-based meat substitutes. ADM will source raw ingredients and to take part in a technology partnership to manufacture products under the Imagine Meats brand. Imagine Meats plans to develop plant-based versions of traditional Indian dishes such as biryani, kebabs, and curry developed from soy and pea proteins.
- Beyond Meat: Tiffany Foods, a subsidiary of Allana Group, recently began importing Beyond Meat patties and sausages into the Indian market. These products have been marketed through Urban Platter, a popular e-commerce site, in the cities of Bangalore, Delhi, and Mumbai. The product has been wellreceived by local consumers with demand outpacing supply. In addition, Tiffany Foods plans to introduce Beyond Meat products in popular grocery retail outlets, including Foodhall and Nature’s Basket.
At present, plant-based meat in India can be purchased in grocery stores, hotels and restaurants, and e-commerce sites. These food products are likely to witness healthy traction in India, given the increase in awareness of such products and substantial growth in urban population. Social media influencers and celebrities have played a significant role in highlighting the importance of plant-based meat. A rise in health-related problems and the growing popularity of healthy alternatives are acting as tailwinds for the future of plant-based meat in India. This in turn could result in high growth potential in the coming years.
(The author is assistant professor at Bharat Institute of Technology (BIT), Meerut. He can be reached at ashiquesumel007@gmail.com)
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