Plant-based eating has become very popular of late, thanks to -among other factors- documentaries like Cowspiracy, What the Health, and most recently Game Changers. There are several categories of plant-based eating:
A vegan is someone who eats a plant-based diet only (including fruits, nuts, seeds, legumes etc.) with no animal products in their diet.
A vegetarian is similar to a vegan except that their diet may include dairy and eggs, but no meat.
A flexitarian (flexible vegetarian) is someone who eats a predominantly plant-based diet but will consume animal products in moderation (eggs, dairy, meat and fish).
Falak CEO Suhail Algosaibi, a flexitarian for over a decade and a half, says “generally speaking, people follow a plant-based diet for three reasons. First, for the health benefits. A plant-based diet can provide benefits like reduced risk of heart disease, some types of cancers, diabetes and obesity. Second, for animal rights reasons, and third, for environmental causes.”
Plant-based diets are nothing new and have been around since ancient times. But there has been a significant rise in plant-based eating that is having a massive disruptive effect on the food industry. Here are some interesting facts from plantproteins.co:
As much as 6% of U.S. consumers say they are vegan — a 6x (500%) increase compared to just 1% in 2014.
Approximately 1.16% of the Great Britain population (600,000 people) reported being vegan in 2018 — a 4x (300%) increase from 2014, when 150,000, or 0.25% of the population, was reported.
Animal agriculture is responsible for 18% of all greenhouse gas emissions, which is more than all transportation emissions combined.
U.S. retail sales of plant-based foods have increased 11 percent from 2018 to 2019, hitting a plant-based market value to $4.5 billion.
The consumption of cow’s milk has dropped so significantly that US dairy farmers are struggling to survive. In fact, Dean Foods, the largest processor of milk in the US has filed for bankruptcy late last year.
There can be no doubt that a seismic shift is happening in the food industry and it’s unlikely to stop, as more and more millennials are embracing a plant-based lifestyle.
So how does this affect businesses? If you are in the food manufacturing, distribution or retail business you are probably already aware of the shift and are taking appropriate steps to provide more plant-based food options.
If you are in the animal agriculture business, you must take the appropriate steps to adapt to the new realties. Not adapting to the new plant-based trends is similar to the horse carriage manufacturer at the start of the twentieth century who refused to believe that the new automobile would be a threat to his business. One report estimates that by 2030 the number of cows in the U.S. will have fallen by 50%.
Finally, for investors, this seismic shift represents a massive opportunity. There are many plant-based food startups coming on the scene that will require Seed, Venture Capital and Private Equity funding (Since its IPO, the share price of Beyond Meat, a meat substitute manufacturer, has risen over 700% at its peak.) The plant-based trend represents an opportunity for the savvy investor.