According to MarketsandMarkets, the global plant-based protein market size was valued at USD 10.3 billion in 2020 to USD 15.6 billion by 2026, recording a CAGR of 7.2% during the forecast period. This is attributed to the growing usage of pea protein in food industry and innovation in the technologies used for extraction of plant-based protein. North America region accounted for the largest market share in the global market.
Drivers: Rise in demand for wellness-focused organic food & beverages
The changing consumer preferences have showcased a growing consumer shift toward adapting to a more nutritional diet centered towards a more sustainable lifestyle and lower dependency on animal proteins. A considerable percentage of the millennial population in Western countries has been observed regarding their changing food habits as consumers move from conventional animal-based products to organic and plant-based food products as an ideal food solution. In recent years, the adoption of plant-based food & beverages among the consumers has been higher due to the broader scope of product availability, improved product developments and innovation into plant-based proteins and a broader scope of available alternatives and substitutes.
Restraints: Allergies associated with plant-based protein sources
Plant-based food & beverages have functional health benefits and consist of essential minerals; however, in several cases, the consumption of select sources, such as soy and wheat, has been identified as allergens resulting in cautious consumer acceptance. Soybeans have s strong nutrient content profile including, vitamins, minerals, and proteins; however, antinutritional components present in soy could cause allergies. According to the Cleveland Clinic, soy is one of the “Big Eight” allergens, along with cow’s milk, eggs, peanuts, tree nuts, wheat, fish, and shellfish, responsible for 90% of all food allergies. A soy allergy occurs when the human immune system mistakes the harmless proteins found in soy as harmful and produces antibodies to combat them. Moreover, soy protein has large quantities of phytic acid, which has the potential to block the absorption of essential minerals, such as calcium, magnesium, copper, iron, and zinc. Soy allergy could also lead to itching and hives in humans. The other aspect is of gluten allergy, which commonly occurs in wheat proteins exhibiting a similar set of characteristics, which has had an impact on the growth prospects of both protein sources.
Opportunities: Rise in demand for food & beverages with organic Ingredients
The organic plant-based protein market has the potential to change the business landscape in the overall plant protein ingredients market. According to the Research Institute of Organic Agriculture (FiBL), “a total of 71.5 million hectares were organically managed at the end of 2018, representing a growth of 2.9 percent or 2 million hectares compared to 2017, the largest growth ever recorded.” In 2018, 2.8 million organic producers were reported globally, and India continues to be dominant with the highest number of producers. Growth of the organic food products market is also expected to boost the growth of the organic plant-based protein ingredients market.
Challenges: Concerns over source quality in food and beverage products due to the use of genetically modified crops
Soy, wheat, and pea are among the prominent sources used in the processing and production of plant-based proteins and are produced primarily in countries such as Brazil, the US, Canada, China, and India. These countries also represent a key portion of the demand for plant-based food & beverages among consumers. However, to meet the growing demand for various plant-based protein sources, farmers often grow genetically modified (GM) crops, which is often seen unfavourably by consumers. To that effect, non-GMO soybeans are primarily used for human consumption, whereas the GM soybeans are found mostly in livestock feed. However, producers are focusing their efforts on the production of non-GMO soybeans, resulting in a higher cost of production, often resulting in lower margins during sales.
By type, the isolates segment is projected to grow with the highest CAGR in the global market during the forecast period
The isolate segment, by type, is projected to grow at the highest revenue CAGR during the forecast period. Isolates are the most refined form of protein products containing a higher concentration of protein. They are easily digestible and can be incorporated into different food products. Protein isolates have been developed from a variety of legumes such as soy, pea, canola, and other sources such as rice and oats. It has a high concentration of protein, with the advantage of color, flavor, and functional properties, which make it an ideal raw ingredient to be used in applications such as beverages, infant foods, children's food, and other types of specialty foods
By application, the food segment is estimated to account for the largest market share in 2020 in the global market.
The food industry of the plant-based protein market is at the forefront of the plant-based revolution. Changing consumer preferences driven by awareness toward meat sourcing practices, its ecological impact, and animal-borne diseases have led to more consumers opting out of meat consumption. The resulting change has led to consumer demand shifting from conventional animal-based proteins to plant-based alternatives. The growing vegan trend has led to an upsurge in manufacturer presence in the sector.
The dry segment in the global market is estimated to dominate the market in 2020.
By form, the market for dry plant-based is estimated to dominate the plant-based protein market in 2020. The dry form of processing of protein is used in the production of protein concentrates. It involves dry milling technology, which is used to reduce the particle size of raw material into fine particles. This method is used to process pulses and cereal, which is correlated to their specific tissue architecture and milling behaviour. The process relies on differential particle size and density within the milled flour. Once milled, the air classification process is used to separate the smaller protein rice fragments from larger starch-rich granules or fiber-rich granules.
North America is projected to account for the largest share in the global plant-based protein market during the forecast period.
The North American market accounted for the largest share in 2020 due to the presence of some of the leading manufacturers such as Cargill (US), ADM (US), DuPont (US), and Puris (US). The North American region has been a key driver for the growth of the market owing to the investments in product manufacturers as well as processing units. The region is a key producer of different sources, including soy, wheat, and pea, with the combined output from the region dominating the global export market. The growing trend of veganism in the region also continues to propel plant-based protein products into the mainstream. The rising incidences of obesity, cardiovascular diseases, and diabetes among the American population has also prompted consumers to adopt vegan diets.