The importance of food and diet to our happiness, productivity, and general wellbeing can’t be understated. However, there is also a significant environmental impact with our eating habits which is currently responsible for over a quarter of global greenhouse emissions. For future net-zero targets to be achieved, drastic action will be required to reduce this impact. For this reason, as well as numerous others, an increasing number of people are turning to plant-based diets for a more sustainable and less impactful source of nutrients. Evidence of this transition can be found throughout the retail and hospitality industries. In coffee shops, we’re now presented with an array of milk substitutes, meanwhile, the vegan sausage roll has established itself as a high-street staple. Further plant-based meat innovations are expected, and the market value of this industry is forecast to at least double before 2027.
Our Ethical Investment Plans include Beyond Meat, which is held in the Pictet Global Environmental Opportunities Fund.
The finance stuff 📈
Company value: £6.3bn
Share price: £100.52
2020 Profits: -£41.1m
What does Beyond Meat do? 🍔
At the forefront of the meat-free revolution is Beyond Meat, a California based vegan food producer, which was founded by Ethan Brown in 2009. As a vegan himself, Brown decided to fill the fast-food void in his life by creating meat-free equivalents using natural ingredients, such as pea-protein, coconut oils, and brown rice, and a chicken-free strips product was the first innovation of many. Shortly after the launch of this product in 2012, Bill Gates realised the potential of Beyond Meat and declared its creations “the future of food” , subsequently investing in the company.
Following the introduction of other meat-free equivalents, namely sausages, mince, meatballs, and its most popular product, the Beyond Burger, the company has experienced spectacular growth. Between 2016 and 2020, the company’s net revenues increased by 2,414%, demonstrating the increasing appetite for its products (pun intended) and saw Beyond Meat develop into a household name in America. Admiration of the company and its inventions continues to expand on a global scale and has led to a plethora of partnerships with multinational companies. Examples including McDonalds, who are working with Beyond Meat to create the McPlant, as well as PepsiCo, with whom the company co-founded the PLANeT Partnership. Here in the UK, we can find Beyond Meat products in many of our local supermarkets.
What positive impact is Beyond Meat having? 💪
Beyond Meat have identified and targeted four key global sustainability issues in their aim to provide a new meaning to the term ‘guilt-free’ food. The issues are:
- Human health – Not only do the Beyond Meat burgers, mince, and sausages contain more protein and iron than their animal-based alternatives, they contain considerably less saturated fat and total fat[5,6,7]. Furthermore, studies have shown that over-consuming red meat and processed meats can increase the likelihood of coronary heart disease and various cancers[8,9]. Therefore, Beyond Meat’s offerings provide a valuable solution to help customers switch to a healthier diet.
- Climate Change – Beef produces more than double the amount of greenhouse gas emissions across the supply chain than any other food1. The Beyond Burger uses 46% less energy and emits 99% fewer greenhouse gas emissions in comparison with the production of a typical US quarter-pounder.
- Constraints on Natural Resources – In addition to its positive impacts on climate change, the Beyond Burger uses 99% less water and 93% less land than the beef burger.
- Animal Welfare – It’s staggering that, excluding humans, 94% of mammal biomass is livestock. Reducing our meat consumption and introducing plant-based foods can not only decrease the impact of intensive farming on the welfare of animals, but also helps us protect them.
What Beyond Meat has to say 📣
“We are in the midst of a sea change in cultural relevance and consumer appetite for change is at the center of the plate. Beyond Meat is leading what has become a movement by providing consumers with plant-based meats that provide the taste and satiation of animal protein, and empowering them to take action one meal at a time with respect to their health and that of their family and community, climate, environment, and animal welfare.”
Ethan Brown, CEO
2020 Annual Report
What Pictet think… 🤓
“Beyond Meat was the first mover and pioneer in plant-based protein products and is one of the fastest growing food companies globally. The animal meat market is valued at some $1.2 trillion today, with plant-based meat substitutes currently representing c. 0.5% - if that! Driven by the strong environmental and health trends, and rapidly changing consumer behavior, we see a pathway for the plant-based category to reach a 5% share of the animal meat market by 2030, growing explosively to c.$60bn in only 5 years. As the pioneer with first mover advantage, leading market share, a recognisable brand, a product driven by innovation and IP, and having already signed-up the key Quick Service Restaurants (e.g. McDonalds), we see Beyond Meat as capable of maintaining its plant based market share of 10%, enabling it to grow sales to >$6bn by 2030 (from $400m in 2020).”
To wrap up 🎁
As the impact of our meals on our planet and its habitants continually increases, so too does the importance of finding sustainable forms of nourishment. With its innovative products, Beyond Meat caters for conscious eaters with a fast-food craving, or simply those who wish to reduce their meat consumption. From an investment perspective, Beyond Meat presents a unique opportunity to not only support the company’s sustainability movement, but to also be involved in an exciting industry that is expanding rapidly.
Please remember the value of your investments can go down as well as up, and you could get back less than invested.