Q2 2022 Overview

• In Q2 2022, plant-based meat startup Rebellyous Foods announced that it has achieved price parity through its novel patent-pending production system prototype Mock 1S. The company claims this will eventually cut manufacturing costs by 95% and result in a 90% waste reduction.

• In May 2022, Spanish plant-based food manufacturer Heura Foods announced the launch of Good Rebel Tech (GRT), a platform to develop micro and macronutrient-rich foods in order to reduce food waste and enhance the benefits of plant-based meats.
• During the same period, MycoTechnology partnered with Oman Investment Authority (OIA) to produce a new protein from upcycled locally produced dates, which are in excess.

• In June 2022, France announced that it will ban the use of sector-specific terms associated with animal meat (such as steak and sausage) to describe plant-based meat options to avoid confusion over meat alternatives. It became the first country in the European Union to impose such a ban. The new regulation, which was heavily supported by the French meat industry and the country’s largest farming lobby, applies to products made in France, while imports will be given an exception. This puts France's developing plant-based economy in a bind and will make the products of French plant-based meat players (such as La Vie, Seafood Reboot, and HappyVore) less competitive against imported products. It could even lead to French alternative meat companies relocating to other countries. 
• In May 2022, the State of Kansas approved the “Fake Meat” bill, prohibiting plant-based meat sellers from using “meat terms” without disclaimers, effective from 1 July 2022. It was largely supported by the Kansas Livestock Association and unanimously passed by the House and Senate. The law requires plant-based meat manufacturers to include a disclaimer that the product does not contain meat on the label (using terms such as vegetarian, vegan, meat-free, plant-based, etc.) in a large and prominent font in proximity to the meat term. Texas, Missouri, Arkansas, Alabama, Colorado, Kentucky, Mississippi, Montana, North Dakota, Oklahoma, Kansas, South Carolina, South Dakota, and Wyoming are among the states that have already passed such legislation with the possibility of more states following suit. However, some states like Louisiana’s court ruled against such labeling laws, citing that it violates the commercial free speech rights of plant-based meat manufacturers.  

New product and market developments: New product launches remain popular despite lower expansion activity

In Q2 2022, we tracked over 45 product and market initiatives.

Source: SPEEDA Edge

• More launches were seen in Q2 2022 compared to the previous quarter (+6.7%), with new launches picking up after a slow February and March following the successful Veganuary campaign. 
• Interesting debuts with unusual ingredients were witnessed:
  • Better Meat Co. launched mycelium-based foie gras, which it claims to be the first mycelium-based foie gras alternative to enter the market.
  • Sundial Foods launched a plant-based chicken with skin and a bamboo stick used as a bone.
  • Nepra Foods launched plant-based beef, chicken, and pork made using textured hemp protein (THP).
  • Jack & Bry launched what it claims is the world’s first unbreaded fish fillet made from jackfruit.
  • ProteinDistillery launched a vegan protein from upcycled brewer’s yeast, which is readily available in Germany due to its substantial beer industry.

Source: SPEEDA Edge

• Foodservice expansion was muted during Q2 2022, both within and outside the US, following the very successful expansion in Q1 2022, in light of the Veganuary campaign. 
• On the other hand, retail expansion in the US picked up considerably in Q2 2022, with Beyond Meat’s significant expansion to product distribution across the US contributing to this growth. Beyond Meat expanded its chicken tenders to over 8,000 new retail locations and its burger and meatballs to ~2,000 locations of the Rite Aid drugstore chain.

Distribution network activity in the US sees strong uptick in Q2 2022

• However, Beyond Meat reported disappointing results in Q1 2022 and continued to experience losses with an EPS loss that was more than 3x higher than the previous year; USD 1.58 for Q1 2022 vs. USD 0.43 in Q1 2021. Revenue growth was just 1.2% YoY to USD 109.5 million, trailing analyst estimates of USD 112.3 million. Its shares tumbled as much as 22% to a record low of USD 20.5 (below its 2019 IPO price). While the launch of its plant-based jerky contributed to an increase in US retail sales, it also led to higher losses due to its complex and high-cost manufacturing process.
• Adding to its troubles, Beyond Meat was also hit with a lawsuit in Q2 2022, with the company being accused of unfair competition due to misleading claims. The lawsuit alleges the company overstated the amount of protein in its products by 30% and that it falsely claimed its products were free of synthetic ingredients while containing methylcellulose. Beyond Meat also came under criticism for appointing Kim Kardashian as its chief taste consultant in May 2022.

Funding: Total funding slows down in Q2 2022

Accompaniments: