According to Boston Consulting Group’s (BCG) most recent data, consumers are buying alternative proteins and are generally satisfied with their purchases. The market share predictions BCG made in its first Food for Thought report in 2021 are coming true: according to the most recent forecast models, alternative proteins will account for 11% of all protein consumption by 2035. With the right combination of technology, capital, and regulatory support, alternative proteins may even control 22% of the global market during this period.
Consumer awareness of alternative proteins has grown significantly, with those who have tried the goods being positively impressed. According to a BCG and Blue Horizon survey conducted in 2022 with more than 3,700 participants across seven nations, consumers in the majority of markets place the highest value on taste, nutritional value, and health. We also discovered that increasing demand requires improvements in three crucial areas: health, taste, and pricing. A healthy diet, according to almost 75% of respondents, is what initially prompted them to start consuming different proteins. However, while choosing amongst a variety of items, flavor stands out as an important factor. In all markets, price is still an issue. Customers are unwilling to pay more for a product that just offers flavor parity with products made from animal products.
The redesign of the food system as a whole includes the protein transformation as one component. The demand for some traditional operations, including animal slaughter and meat packaging, may diminish as value pools grow around new technologies and processes that help solve such important issues as flavor, health, and cost. The shift is expected to have an influence on every stakeholder throughout the value chain, and many of them will discover significant potential to help create a sustainable food system.
On the other hand, 26% of the world’s current greenhouse gas (GHG) emissions come from the food sector. The major GHG producer in the food system, animal agriculture, contributes 15% of the world’s emissions, which is comparable to the emissions from the transportation industry. In order to achieve the goal of an 11% market share for alternative proteins by 2035, we must reduce global CO2 emissions by 0.85 gigaton (CO2e) by 2030, which is the same as decarbonizing 95% of the aviation sector, according to the report. The economic and personal consumer tradeoffs involved in switching to alternative proteins are quite minor in comparison to other options, such as reducing air travel or retrofitting existing dwelling stock. According to BCG’s survey, more than 30% of customers believe that switching to alternative proteins will have a significant positive influence on the environment.
Alternative proteins work just as described above. When measured by the market value of avoided CO2e emissions per dollar invested in mitigation initiatives, investing in the sector has one of the highest effects on decarbonization. BCG refers to this as the impact of capital employed (IoCE), because investments in alternative proteins produce IoCE that is orders of magnitude more than what is possible with comparable decarbonization investments in other high-emitting economic sectors, such as transportation or buildings.