The plant-based meat industry in Australia is said to be steadily expanding, with significant growth in the foodservice sector.
According to Food Frontier’s ‘2023 State of the Industry’ report, plant-based meat sales in Australia have increased by a total of 47% between 2020 and 2023 and per-capita consumption has increased by 28%.
“Despite the economic challenges faced by plant-based meat companies here and overseas it’s evident that the industry is here to stay, and that Australia is performing better than overseas markets in the face of these pressures,” says Food Frontier CEO Dr Simon Eassom.
Comprising Deloitte Access Economics insights and industry data by Food Frontier, the report found that in 2023 total plant-based meat sales in Australia reached $272.5 million, representing a compound average growth rate (CAGR) of 14% since the 2020 financial year.
Significant growth has been seen in foodservice, where the wholesale surge of plant-based meat represents a CAGR of 59% since 2020. Retail sales, however, experienced a slight contraction (down 1% CAGR) from 2020.
“The category has been affected by lower retail sales, attributed to inflation and the increased cost of living, which has impacted all food products perceived as either premium or discretionary,” says Mr Eassom.
“Some products were not meeting consumer expectations around taste, and the higher price point compared to conventional counterparts has reduced repeat purchases, leading to a revised forecast value.”
In the face of inflationary pressures, the report revealed that the prices of plant-based meat products have inched closer to conventional meat prices, reducing the price disparity. The average price premium for plant-based meats has reduced from 49% in 2020 to 33% in 2023.
Looking ahead
Based on current economic factors and market dynamics, Deloitte Access Economics now forecasts a market size of $1.65 billion by 2033, down from the 2019 estimate of $2.9 billion by 2030.
“While there is likely to be ongoing expansion in the plant-based meat industry, success within the sector varies among businesses. With the market adjusting during an economic downturn, we can anticipate further consolidation in retail offerings,” says Mr Eassom.
“Noting that most foodservice sales of plant-based meats are in quick service restaurants, the report found there is strong potential for growth if plant-based meat manufacturers expand into new foodservice outlets and across untapped foodservice segments. This is discussed among the recommendations included in the report.”