According to Euromonitor International, sales of plant-based meat in China grew from US$7.2bn in 2014 to US$9.7bn in 2018, at an annual growth between 13 to 15%. The growth is not expected to slowdown anytime soon.
A Mintel survey found 70% of consumers in China were interested in reducing their meat consumption. Shirley Lu, executive director, Greater China at food awareness organisation, ProVeg International said this was attributed to growing health consciousness among Chinese consumers.
Lu said this is expected to drive innovation in the sector: “China has a distinctive and rich food culture. With soy products and tofu already so ingrained in its society, we now expect China to develop a new plant-based culture, version 2.0, full of innovative new plant-based and cultured meat products.”
In the first of its kind in Asia, ProVeg International and the Shanghai Society of Food Science launched a plant-based food innovation contest in Shanghai to accelerate the development of plant-based foods in the region.
It is open to students in Shanghai who will work with nine major F&B companies including Bright Dairy, Lee Kum Kee, Danone, Beyond Meat, Oatly, ChaCheer, New Hope Liuhe, Griffith Foods, and Ferrero.
These companies will mentor the teams, provide lab facilities, materials for prototype development, and a budget for market research. The contest is not limited to product and application innovations, it will also include food policies and dieting guidelines.
Each company has proposed an area of innovation. For the third largest dairy manufacturer in China, Bright Dairy, it is proposing the idea of developing a series of fermented plant-based yoghurt. Lee Kum Kee is hoping to develop plant-based sauces, Ferrero with a plant-based chocolate confectionery or spread, and New Hope Liuhe on new meat jerky substitutes. Danone is hoping to design a premium plant-based milk brand for its retail channels in China.
“Our goal is to reach 1000 students, 100 groups of idea submission, 10 finalists, and 3 commercialisations within 12 months post-campaign,” Lu remarked. The winners will be announced in November.
Going above and beyond
For Beyond Meat, it is hoping to design different applications and local recipes for its plant-substitute line of beef, poultry and pork.
In an email statement to FoodNavigator-Asia, Chuck Muth, Beyond Meat’s chief growth officer said the firm was a consumer-driven brand and hopes its participation in the contest can create products that appeal to local consumers.
“Recognising that the younger generation is highly interested in plant-based meat, we partnered with ProVeg to work directly with students to hear their innovative ideas about the future of plant-based meat in China. Part of our commitment in China is to engage with consumers at a grassroots level and ensure that we create products that will excite and appeal to local consumers.”
Beyond Meat recently entered China in April through food service channels such as Starbucks, KFC, Pizza Hut and Taco Bell.
In July, the firm announced its launch into retail via Alibaba’s grocery chain Freshippo (Hema), in a bid to increase market presence and reach out to home-cooks.
It is retailing its frozen Beyond Burger (“beef”) in 50 Freshippo stores in Shanghai, before adding 48 stores in Beijing and Hangzhou in September.
Muth said he hopes its products can “appeal to mainstream consumers who love eating meat but are increasingly aware of associated health, climate, environmental, and animal welfare considerations.”
He added the patty was a rich source of protein derived from peas, mung beans and rice and had 35% less saturated fat and total fat compared to traditional minced beef patty.
A 2018 Life Cycle Assessment conducted by the University of Michigan found that producing the Beyond Burger patty requires 99% less water, 93% less land, 46% less energy and emits 90% fewer greenhouse gas emissions than a typical beef burger patty.
Jiayu Zhao, senior director and head of merchandising at Freshippo told us Beyond Meat was the very first plant-based meat brand introduced on the platform. “The interest from similar brands to sell their products on our platform is certainly on the rise. We are in discussions with other brands, both local and overseas, to explore collaboration opportunities.”
Zhao said Freshippo was increasingly becoming a gateway for overseas food brands entering China and for product debuts. “The New Retail model of Freshippo integrates online and offline sales, reaching out to a growing number of emerging middle-class consumers.”
With its roots in Shanghai, it was a no-brainer for Freshippo to launch Beyond’s products there. “The city boasts a well-developed consumer market and a large group of shoppers who are keen to try new things. We launched this product in Shanghai as we considered that the city’s consumers have a high degree of concern about the environment and their own health,” Zhao explained.
Since the announcement of its collaboration with Freshippo, the share price of Beyond Meat has increased by more than 10%.
In Q1 2020, Beyond Meat achieved net revenues of US$97.1m, an increase of 141% compared to the first quarter last year. “We believe our dual-pronged approach of aggressively expanding availability of Beyond Meat products in both retail and foodservice outlets served us well and continues to mitigate more significant COVID-19 related disruption to revenues,” Muth concluded.