Global surge in plant-based, cultivated meat; Indian market sees substantial growth

The world will have to build alternative proteins for meat consumption. Currently, the global alternative meat market looks very attractive. It is projected to reach between $350-400 billion by 2035, according to Rahul Misra, Business Sweden.

In India, the plant-based market is expected to grow to $650-700 million by 2025. Reports indicate, 54 percent of the early adopters in India are familiar with plant-based meats. And nearly 80 percent are willing to try them.

2020 saw a major expansion of this sector. Some eight out of 21 plant-based meat alternative Indian startups were launched during 2019-20. And five major International and Indian players entered this segment during 2020-21.

Speaking at a recent India-Sweden Agri-Food Tech webinar, Nicole Rocque, Innovation Specialist of The Good Food Institute India said: “Contrary to the popular misconception, 71 percent of India's 1.3 billion people self-identify as non-vegetarian. But there is an underlying culture of guilt associated with eating non-veg food in India with religion designating certain days of the week or year as holy and therefore for people to skip the meat. There is also the income factor, this creates drivers for meat replacement. The market is now taking off after years of ecosystem building. Smart protein market will continue to provide open spaces for international businesses to see as viable opportunities moving beyond the early adopter cohort.’’

Investments in alternative protein companies have skyrocketed globally. Venture capital and private equity investment reached $3 billion last year. Some 50-70 percent rise in protein demand was driven by emerging markets – India, China, SE Asia.

The alternate smart protein market falls into three categories: plant-based (advantages like reducing environmental pressures), fermentation (enabling technology for alternative protein industry in terms of ingredients and products leveraging micro-organisms), and cultivated meat (using animal cell culture).

India has the world’s largest consumer base. And it is witnessing a transition in income group, urbanisation and internet utilisation. According to WEF future on consumption, India will spend an estimated additional $1.6 trillion by 2030 on aspirational and healthier foods. Lack of protein in Indian household diets, growing climate change awareness, supply chain impact are some of these growth.

“Through our distributors in tier 2 and tier 3 cities, we see adoption and repeat purchases of plant-based meat. There is a significant willingness in Indians to try plant-based meat,” said Abhishek Sinha, Co-founder and CEO, GoodDot.

India’s biodiversity offers plant-based companies to leverage some of these unexploited high protein crop varieties. India has 15 agro-climate zones, which require international partnerships to build sustainable and climate-resistant solutions. It can serve the needs of a growing population and also serve as an important export market. There is a growing demand for investment in India’s agri-tech market to support innovations in plant-based alternatives to meat.

Dr Babita Bohra, Lead Programs, Indian Chamber of Food and Agriculture says, “being a food secure nation, India is now moving towards technological innovations. The export market for agri-produce is huge, a staggering USD 38.54 billion in the last financial year. The key focus area for agri-tech startups is improving the supply chain, as this helps farmers get a better price for their produce. India accounts for more than 450 agri-tech startups (which means every 9th startup is opening up in India).”

For example, the India-Sweden Smart Protein Corridor is trying to create knowledge institutes and universities, provide startup support, supply chain linkages, venture capital investment, industry linkages, and bilateral funding between India and Sweden.

According to Cecilia Oskarsson, Trade Commissioner, Business Sweden in India, “Sweden is among the top 20 companies globally in terms of agri-food investments and India is among the top 5 potential markets for Swedish Agri-Food Tech firms. At present, there are 10 Swedish Agri-tech companies in India and we hope to expand more in this sector.”

“We have Volta Green Tech, Ecobot for farm robots, surplus and waste management companies like- Karma Food Rescue App, urban farming, vertical farming startups, sustainable packaging startups like Innoscentia with a team in India, e-grocers, last-mile delivery companies. And the next-gen food companies like Stockeld Dreamery- which is trying to be a category leader in plant-based cheese,” said Daniel Skavén Ruben, Head of Strategy, Stockeld Dreamery, Sweden.

But, Mark Kahn, Managing Partner of Omnivore India said while the agri-technology sector in India cannot be ignored “as its too critical a sector,” the alternative protein market in India is different.

“We feel the default meal in India is still vegetarian. India’s flexitarianism is different from the West or China where they consume every form of animal protein imaginable. In India, even the people who eat meat, eat it very rarely. Vegetarianism in India is linked to income. You will have to build plant-based alternatives not for the bottom billion since they are already eating vegetarian food but for the upwardly mobile.”

Investors are bullish on the India Food Tech market. Food Technology is leading the way, be it bioengineering, biotech, synthetic biology, or genetic biology. Global venture capital investment in biotechnology saw $28.5 billion of investment -- a 60 percent year-on-year rise.

India’s plant-based protein and agri-tech industry offer an attractive market for growth and innovation. It provides opportunities for innovative foods, farm automation, novel farming, Ag Biotechnology, and food security.

What Indian farmers need is market linkages, supply chain management, traceability and blockchain, weather prediction, precision agriculture and automation. They need collaborations with market leaders who have made progress in areas like gene editing, accelerated breeding, new molecules.

Two billion people globally face food insecurity. As we go forward, we will need food systems that supply at scale. This is essential to address the expansion in demand due to upward social mobility, increasing urbanisation, and changing demographics. Agricultural markets as large as India will be key to that development.