The popularity of plant-based food just keeps growing and the retail sector is experiencing a boom as demand exceeds $1.4 billion in sales with no end in sight.

Plant-based food retail sales were worth $7 billion in 2020, posting a 27{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} growth rate overall for products that specifically replace animal-derived options, according to SPINS data released by the Good Food Institute and the Plant-Based Foods Association (PBFA). A total of 57{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} of U.S. households purchased plant-based food in 2020, up from 53{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} in 2019.

Plant-based meat had $1.4 billion in sales, growing 45{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} overall compared to 2019 and making up 2.7{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} of all U.S. retail packaged meat sales. Refrigerated plant-based meat sales saw the highest growth percentage, up 75{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} in 2020.

The coronavirus pandemic brought on a boom in plant-based sales in 2020, as consumers looked for products they thought were better for them – or discovered the brands on store shelves as many conventional meat producers faced production challenges.

Considering that plant-based food sales have been on an upward trajectory for the last several years, coming in at $5 billion in sales in 2019, the segment’s sales growth was certainly expected. But growth in 2020 took a steep upward turn, with sales figures climbing more than twice as fast as the 11{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} growth the segment saw in both 2019 and 2018.

The biggest winner in terms of sales gains was plant-based meat. While traditional meat also saw large sales growth in 2020, plant-based meat doubled that. It’s becoming much more of a force in the meat section, with 18{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} of all households purchasing it – up from 14{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} in 2019, SPINS found. Plant-based meat has a high repeat rate, with 63{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} of consumers purchasing it multiple times. SPINS attributes this high growth of plant-based meat to many retailers starting to shelve it differently. Last summer, Kroger and the PBFA found that plant-based meat sells about 23{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} better when it’s placed next to traditional meat.

There are also more products available. Impossible Foods saw a retail explosion in 2020, with its Impossible Burgers going from being available in about 150 stores nationwide at the beginning of the year to about 20,000 stores today. Nestlé has also been concentrating on growing its plant-based options, both through new plant-based meat products and by making plant-based meat versions of some of its frozen entrees.

Plant-based meat companies also worked hard in the past year to come close to price parity with animal meat, which many in the industry have said is an important step to make consumers want to buy it. Before the Butcher’s Mainstream line, which debuted last fall, costs about $5.50 per pound – similar to the price of lean ground beef. Beyond Meat sold a value pack of patties last summer that was very close to the price of beef. And Impossible Foods recently cut its retail prices 20{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63}, putting it in striking range of beef.

Plant-based milk, which is the largest category in the segment, also saw great sales growth in 2020. SPINS found a 20{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} increase in dollar sales in this segment – four times as much as the 5{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} growth rate posted in 2019. Nearly four in 10 U.S. households purchased plant-based milk, which now makes up 15{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} of the total category and is worth $2.5 billion. While almond milk is still the segment leader, making up about two-thirds of all dollar sales, oat milk is now second, with sales more than tripling last year.

While plant-based milk is not a new segment, analysts have said its growth has been helped along by the pandemic as well as innovation. The health halo of plant-based milk has bolstered sales. And when consumers were looking to stock their pantries, shelf-stable plant-based milks were both available and appealing for their storage ability. And trendy new innovations in plant-based milk – ranging from Oatly’s mega-popularity to the prototype for Impossible Milk to artificial intelligence-designed NotMilk that hit U.S. shelves last year – keep consumers interested.

Other plant-based dairy and related products also saw large sales increases, and are collectively worth about $2 billion, according to SPINS. The fastest growth was in plant-based eggs, which saw a 168{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} increase – nearly 10 times the rate of conventional eggs. Since the beginning of 2020, category leader Eat Just has expanded quite a lot, launching frozen folded Just Egg and frozen sous vide bites, and reducing the cost of its pourable Just Egg substitute by nearly 50{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63}.

Plant-based yogurt and cheese also saw huge growth in 2020, SPINS found. Plant-based yogurt sales were up 20{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} — nearly seven times the growth rate of conventional yogurt – and plant-based cheese grew 42{85424e366b324f7465dc80d56c21055464082cc00b76c51558805a981c8fcd63} – about twice as fast as dairy cheese.

Although the COVID-19 pandemic made a big impact on the retail food landscape, the 2020 growth rates for plant-based items may not be anomalies. Big companies including Nestlé, Danone and Unilever are all planning for plant-based to become a larger part of their sales. Investment firm UBS predicted in 2019 that plant-based food would be an $85 billion industry by 2030, and these 2020 sales figures show how that forecast might come true. With $2.1 billion in investment dollars last year to plant-based companies, there is also a large financial pipeline both for innovation and expansion.

Original source: https://www.fooddive.com/news