In the next decade our eating habits will undergo profound change. The development of plant-based foods, gene editing, and food personalization will disrupt the whole food value chain. In its first Q-Series report, UBS analyzes the fast-growing plant-based meat (“PBM”) industry and forecast its impact on the $1.2 trillion animal meat market and value chain.
To frame the implications and size the market opportunity, UBS uses its Evidence Lab survey of 3,000+ consumers and 50 restaurant franchisees, reviews of 20+ million social media interactions, and interviews with 20+ protein scientists/supply chain experts. From that, it forecasts the global PBM market to reach about $50 billion by 2025, or 2.5% penetration of total meat consumption volume (about 4% on a USD value basis), from sub-1% today.
UBS Evidence Lab survey data show consumer PBM use is low in developed markets, but rising fast, with consumer burger trialling at just 8% in the US and mid-20% in the UK and Germany. Survey data show 73% of interested buyers rank "taste curiosity" as their top reason to try PBM, whereas loyalists cite health perceptions and environmental concerns. To convert non-PBM users, respondents suggest food producers improve taste and affordability to drive adoption. In the restaurant franchisee survey, we learn PBM is attracting incremental traffic, boosting sales and yielding a high 20% QSR (Quick Service Restaurant) repeat purchase.
UBS introduced an interactive model to forecast global plant-based meat demand. Based on primary data sources and collaboration with UBS analysts across four geographical regions, its base case models global PBM volume consumption to grow at a +31% CAGR through 2025 vs. an animal-meat CAGR of 0.9%. The speed at which consumers trial and repeat or exit the PBM category carries implications for food producers, chemical and ag processors, restaurants, and grocers. We view Food & Restaurants as having the best exposure, while upstream industries are mixed. In food, PBM brings a growing profit pool to pure-plays and food producers. In restaurants, PBM is boosting traffic and sales comparisons.