A paradigm shift appears to be coming quickly down at the fast-food drive-thru.
Last week A&W Canada announced a new meat-free burger, touted as just as good as ground beef.
It has partnered up with Beyond Meat, a company that’s attracted capital from sources such as Microsoft mogul Bill Gates and A-list actor Leonardo Dicaprio. Come July 9 it is promising a national rollout for the new meatless alternative, which is already generating a lot of buzz.
Food critics say the burger is a dramatic improvement over the existing option, which Toronto Star food writer Amy Pataki described as a “rubbery disc of rice and mushrooms.” When testing the new option, she reported a product that looked, smelled — and even sounded — like a beef burger as it sizzled on the grill. Apparently it tasted like one too.
The new option is made from plant-based products including peas and mung beans and is coloured with beet juice to ensure pinkish juices leak from it.
This is just the latest salvo in the war over the ubiquitous hamburger. Many other companies are beginning to push options that could replace ground beef, ranging from plant-based proteins to lab-grown beef that’s genetically and culinarily indistinguishable from the real deal.
The lab-grown meats are an interesting — and concerning for livestock farmers — case study.
The first Petri dish burger hit the plate in August of 2013, at a news conference in Britain. Researchers demonstrated the technology but admitted it came with a whopping price tag of US$325,000 for the prototype, causing many to scoff that beef was in no imminent danger.
However, that ignored the economics of prototyping any product. The first widget of any type always involves hefty research and development costs and other one-time-only costs. It’s once the process is up and running that costs fall precipitously until something is suddenly affordable to all.
We’ve seen this pattern repeatedly in everything from cars to computers, and it seems the remorseless economics of commercialization are in action again.
Less than two years later, in April of 2015, the Smithsonian Institute’s website was touting lab-grown burgers had already got “… a $324,989 price cut.” In 20 months they’d got the cost per patty down to just US$11.
That still wasn’t going to drive McDonald’s out of business, but it did cause big companies to sit up and take notice.
Since then there’s been a flood of capital into the sector, including money from big food companies that seem to see the writing on the wall.
In April of 2017 Cargill was selling off the last of its cattle feedlots, saying it was freeing up capital to invest in alternatives like insect- and plant-based proteins.
That same year Tyson Foods, the largest meat producer in the U.S., announced it was part of a US$55-million round of investment in Beyond Meat, the producer of the A&W patties.
Other investors in the emerging sector include British entrepreneur Richard Branson, the food giant Nestle, and even our own Maple Leaf Foods. Nestle has publicly predicted that by 2020 plant-based foods will grow to become a US$5-billion market in America.
Most of the companies making these investments point to the fact meat alternatives are one of the fastest-growing food segments and are becoming impossible to ignore. They’re not turning their backs on meat, but they’re not doubling down on it either, in the face of shifting consumer sentiment.
If meat alternatives continue to grow in popularity, it could serve to undermine the economics of traditional animal protein, which depends on using as much as humanly possible of every animal slaughtered.
For now at least the alternative protein sources seem to be concentrating on the lower end of the market — burgers, hotdogs and similar processed items.
That’s a problem because while consumers might still be willing to spring for that steak or roast, the market for the off cuts appears to be drying up.
If these alternatives do take off, livestock producers will have to think long and hard about how they want to position their products in the market.
Right now many appear to be counting on the ‘yuck factor’ that will discourage consumers because they feel a lab-grown alternative is unnatural.
Having ready alternatives will, however, make for some interesting dynamics. The animal welfare question becomes even more important if, for example, a consumer can choose ‘chicken’ that’s never even been introduced to a living bird, much less seen the inside of a barn.
In that kind of market consumers can vote with their wallets with unnoticeable changes to their own consumption patterns.
There’s clearly both a growing demand and emerging supply and farmers need to figure out how to get their piece of this pie.
If they don’t they may find themselves watching the feast.