The rising cost of meat products is weakening local demand and feeding into the soaring vegan food market, according to research from IBISWorld.
As a result the meat sector is continually turning to overseas markets to sustain growth.
“This surging demand for plant-based alternatives represents a growing threat to local demand for meat and dairy products, which will in turn affect the long-term viability of the Australian Meat Processing, Beef Cattle Farming, Cheese Manufacturing, Butter and Dairy Product Manufacturing, and Milk and Cream Processing industries,” said IBISWorld Senior Industry Analyst, James Caldwell.
“The Australian Meat Processing industry now generates over 60% of its revenue from overseas, and we expect this number to rise over the next five years.”
With the vegan market soaring over the last five years in Australia, major food manufacturers are under increasing pressure to introduce new products to meet demand.
“The quality of these products is also increasing at a rapid pace, with plant-based alternatives to meat and dairy foods continuously being launched. Unilever recently launched a plant-based alternative to its Magnum ice cream products, and popular food chains Hungry Jacks, Schnitz and Grill’d have all recently added plant-based options to their menus, in an attempt to take advantage of rising demand,” Caldwell added.
Australians are increasingly concerned about their impact on the environment, which IBISWorld analysts believe to be a factor behind the rise in demand for plant-based products.
Supermarket giant Coles reported an additional 1500 new customers following the launch of a plant-based burger in NSW last year.
“We launched the Beyond Burger late last year in 200 of our New South Wales stores and had nearly 1,500 new customers in the first 10 weeks – two-thirds of these customers were existing BBQ meat shoppers,” Coles category manager for BBQ, Harriet Wischer said.
Wischer found that most customers were combining both plant-based and meat options into their diets.
“Our customers are becoming more and more interested in plant-based foods, but people are not so much switching to a full vegetarian diet – they’re substituting veggie options a couple of times a week,” she added.
The latest UK research found more than a third (34 per cent) of consumers now have meat-free or meat-reduced diets – comprising 21 per cent flexitarian, 9.5 per cent vegetarian and 3 per cent vegan.