How alternative proteins could disrupt traditional ag
A food and ag economist says increased investments in alternative proteins could be very disruptive to traditional agriculture.
Jayson Lusk with Purdue University says while plant-based meats use ag commodities like soybeans, they do not require enough to use the roughly 80 million acres grown annually in the US- 85% of which goes to livestock.
“Two-thirds or so of the value of the receipts from farm production are tied up in animal protein production. So any factors that reduce demand for animal protein have the potential to have really big impacts on the agriculture economy.”
He says during the peak buying period of the pandemic refrigerated meat alternative sales increased by 250%, but even as that settled down the sector has seen a 100% increase from last year.
“Part of that means it is growing of course, but some of that is a result of the fact these are really small markets to begin with. So, if you go from 1 to 2 that is a 100% increase.”
He says curiously, alternative meat sales were not significantly higher during peak packing plant closures which poses some questions.
“Are they people who would have bought meat to begin with? Or are these new people coming into the market? In other words, is this just growing the size of the pie by people choosing an alternative who would not have purchased meat to begin with.”
He says meat alternatives are not currently a major disruption to traditional agriculture, but growth and investments in the industry show potential for that in the future.
Lusk spoke during a virtual conference on Midwest Agriculture and Shifting Consumer Preferences hosted by the Federal Reserve Bank of Chicago.