Tyson Foods is headquartered in Arkansas, US, and is engaged in offering chicken, beef, and pork, as well as prepared foods. The company offers food products under Tyson, Jimmy Dean, Hillshire Farm, Sara Lee, Ball Park, Wright, Aidells, and State Fair brands. It has its presence in Central America, China, Canada, Japan, the Middle East, the European Union, South Korea, and Taiwan. On 13th June 2019, the company announced the launch of its first plant-based blended products under its new brand, Raised & Rooted, as part of its efforts to expand its protein offerings. Earlier, in April 2019, Tyson Foods ended its investment with Beyond Meat, which is engaged in manufacturing plant-based meat, to start its own brand of plant-based meat products. With the rising trend of healthy lifestyles, meat producers need to shift their offerings to products that have improved nutritional profiles. The belief among consumers that plant-based proteins are better for heart health, easier to digest, and better suited to aid weight loss than animal protein, will disrupt the animal meat market in the future. Since Tyson Foods has a major stake in traditional meat such as chicken, pork, and beef, it is more of a precautionary move rather than a strategic one to enter into the booming market of plant-based meat.
MarketsandMarkets’ View Point:
The rise in awareness about the health benefits of plant-based meat over animal meat and the rapidly growing vegan and flexitarian population across the world drive the demand for plant-based meat products. Thus, many food giants are investing in plant-based meat products, while many other plant-based meat companies are expanding their presence by entering into partnerships with retail chains or restaurants for the distribution of their products. Tyson Foods is one of the world’s largest meat producers and has an extensive supply chain. With its strong foothold in the US, it will be easy for the company to distribute its products to retail chains and restaurants across the country. “According to Noelle O'Mara, chief marketing officer at Tyson Foods, more than 60% of consumers are actively adding protein to their diets, and 75% are open to including both meat- and plant-based proteins. Thus, by introducing plant-based nuggets and burgers, the company is catering to the growing demand for plant-based meat. Through this, the company is up-selling plant-based meat in such product forms with less meat and potentially more money.” - said Bhagyashree Pathade, (Strategic Growth Analyst- Food and Beverage at MarketsandMarkets™).
“Alternate protein, plant-based meat, and cultured meat are perfect alternatives to meet the demand for meat around the world. These products not only meet the penchant for meat eaters but also improve human health. The adjacent positive effects on climate change and animal conservation create a perfect harmony as well. With the changing consumer behavior favoring this rising trend, I believe the multi-billion-dollar meat industry is set to have a disruptive shift in the next decade.” – said Nagesh Manepalli (Head - Research, Food, Beverages, Animal Nutrition, and Agriculture)
Impact of Product Launch
Cultured meat and new meat replacement products are going to disrupt the USD 1,000+ billion conventional meat industry. Through Raised & Rooted, Tyson Foods is projected to witness increased sales in the coming years with the growing demand from consumers.
The figure below shows the market opportunity available in the plant-based meat market. The North American market accounted for the largest share in 2018, and it is projected to grow at the highest CAGR from 2019 to 2025. The North American region is backed by the key players operating in the plant-based meat market, which, in turn, is backed by a robust distribution network across the US. This is expected to increase the sales of plant-based meat products in the country.
FIGURE 1 PLANT-BASED MEAT MARKET FORECAST TO 2025
e - Estimated; p - Projected
Source: MarketsandMarkets Analysis
Key players in this market include Impossible Foods (US), Beyond Meat (US), Garden Protein International (US), Morningstar Farms (US), Quorn Foods (UK), Amy’s Kitchen (US), Maple Leaf Foods (Canada), The Vegetarian Butcher (Netherlands), Tofurky (US), Gold&Green Foods (US), Sunfed (New Zealand), and VBites (UK). After its announcement of the new brand, Tyson Foods’ shares climbed three percent while the shares of Beyond Meat fell by four percent.
The retailers in the country are expanding their retail shelves for plant-based products as consumers increasingly incorporate plant-based foods in their diets. No Evil Foods (US), a plant-based meat company, plans to appear in over 250 Walmart stores to expand its base in the plant-based meat market. In 2018, Alpha Foods (US) had its plant-based meat products available in over 5,000 stores in the US. Thus, with a number of players entering the plant-based meat market, especially in the US, the demand for plant-based meat is expected to increase in the coming years in the country. The introduction of new products by Tyson Foods depicts the rising market for plant-based meat and its direct influence on market growth. Considering the growing demand for plant-based meat in the US, the introduction of Raised & Rooted is likely to impact the traditional commercial meat industry and other plant-based meat manufacturers.