The World’s Largest Meat Seller Embraces Plant-Based Proteins As Pandemic Demand Surges

JBS, the world’s largest meat company, unveiled its own line of plant-based burgers and chorizo alternatives this week, joining Beyond Meat
BYND
and Impossible Foods in the crowded race to win over consumers with new protein. 

The Brazillian meat giant originally planned to unveil the line of pea protein products branded Ozo in April but delayed the launch when the pandemic delayed shelf resets at most grocers. They will start appearing on shelves at Albertsons and Safeway locations in Rocky Mountain states like Colorado and New Mexico, as well as Kroger
KR
stores in 12 states. 

“We’re not saying that meat is bad,” says Darcey Macken, CEO of Planterra Foods, the new Colorado-based subsidiary of JBS USA where Ozo and other plant-based foods are being developed. “People getting their heads wrapped around plants can be for all different motivations, whether it’s about earth and sustainably or just not eating animals.”

Fears over meat supply shortages led to a new round of panic-buying in April and May that pushed big grocers like Costco, Kroger, and Texan chain H-E-B to limit customer’s meat purchases. For upstarts like Beyond and Impossible, it became the ultimate test: if these proteins couldn’t prove themselves with consumers at such a crucial time, when would they? 

Planterra products are being stocked at a critical moment for plant-based foods, which have seen a rise in demand as meat supply fears — now abating — had escalated considerably. With meat sales declining, plant-based foods surged, with refrigerated alternatives like Beyond and Impossible up 241% during the peak of meat panic-buying and rising another 113% since the end of April, according to SPINS, a data company that tracks grocer sales. 

“A lot of these hotspots are in meat processing facilities and consumers are understandably concerned,” says Jeff Crumpton, the manager of retail reporting at SPINS. “They are seeing all these cases, and have this other solution, this other product that maybe they really like. It feels like a safer alternative and it’s something that they can get their hands on.”

Meatpackers have been edging into the plant-based market for years. Tyson invested in Beyond Meat as early as 2016 and sold its 6.5% stake before the startup’s April 2019 IPO, two months before it began selling its own line of plant-based products. Smithfield and Hormel
HRL
followed later that year. Cargill announced in February that it would offer private label plant-based protein to grocers that would hit the first shelves in April. Unlike Planterra, the pandemic didn’t delay the launch at three large retailers.

The plant-based food makers have also been looking to expand their reach globally as the pandemic and African Swine Fever in China created more widespread interest in non-meat proteins. Beyond Meat announced in early June that its burger would launch at some KFC, Pizza Hut and Taco Bell locations in mainland China, while Cargill also expanded to the China market this month.

Beyond announced Wednesday that it would reduce prices with summertime value packs to entice more customers to try its quarter-pounders through grilling season. Beyond is still around $1 more expensive than ground beef, while Impossible’s is more than double the per pound price. 

The price gap has narrowed slightly as pandemic-related production slowdowns force beef prices to new highs, with the Bureau of Labor Statistics reporting an 11% increase for beef and veal prices in May, the largest ever monthly increase, which has excited the plant-based protein industry. 

“Nobody knew how this would impact the industry as a whole,” says Julie Emmett, senior director of retail partnerships at the Plant Based Foods Association. “Plant-based sales continue to grow so strongly after panic buying, and faster than total sales and faster than animal-based meat.”

Full coverage and live updates on the Coronavirus