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Alternative protein heats up in the GCC region

by Mohammad Ghazal

Consumer interest in non-meat-based protein alternatives is increasing globally and this trend will continue over the coming years, with the Gulf Cooperation Council (GCC) region emerging as an investment hotspot.

Alternatives to animal proteins include plant-based proteins (soy, pea), new animal sources (insects), and biotechnological innovations (cultured meat or fungal protein). The production of these foods is generally regarded as having a much lower environmental impact than conventional animal protein, in terms of land usage and emissions Furthermore, alternative proteins do not face the same sort of ethical issues with regard to animal cruelty as the meat industry does.

As a case in point, producing 1kg of beef emits 60kg of CO2-equivalents, while lamb and cheese both emit more than 20kg of CO2-equivalents per kg produced. Poultry and pork have lower footprints but are still higher than most plant-based foods.

Rising global footprint

The consumption of alternative proteins has increased rapidly over recent years, driven by environmental considerations, ethical concerns, worries over the health implications of a high-meat diet and food security risks. The Covid-19 pandemic has served to accelerate the consumption of alternative proteins as consumers have become increasingly wary of relying so heavily on an animal-based food system. Furthermore, disruptions to global supply chains, including in the meat processing industry, forced consumers to look at alternative sources of protein.

Matching this rising demand has been a sharp uptick in the commercial availability of alternative proteins, primarily plant-based meat alternatives. According to Vantage Market Research, the global alternative protein market was valued at US$49.70mn in 2021 and is expected to reach US$126.84mn by 2028. While this is a fraction of the global meat market, strong growth fundamentals will see market share rise significantly.

Growth potential particularly positive in the GCC

The growth outlook for the consumption of alternative proteins is particularly buoyant in the GCC region. This is underpinned by several factors including elevated food security concerns, rising ESG agendas and shifting consumer patterns of the youth population. Furthermore, historically, meat has dominated consumer spending on food in the GCC, highlighting the strong demand for proteins in general.

Elevated food security concerns: Limited agricultural land, combined with water scarcity and hot desert climates, has made large-scale agricultural production across GCC states problematic. As such, the region is heavily reliant on food imports to fulfil domestic demand. In fact, GCC countries are amongst the largest net importers of animal proteins globally on a per capita basis.

As such, expanding the alternative protein sector in GCC markets will help governments of the region reduce import dependency, improve self-sufficiency and overall boost food security. This is being done through public investment into the sector or by adopting attractive regulatory frameworks that entice investors into the sector.

Positive demographics driving alternative protein uptake: The GCC’s youth bulge is likely to be a key driving force behind demand growth for alternative proteins over the coming years. According to World Bank data, nearly a quarter of the GCC’s total population is between the ages of 15-29. Young adults, particularly in the Gen Z or Millennial categories, are typically seen as the ‘trendsetter generation’ and are relatively more open to incorporating new and innovative food items into their diets compared to older generations. Additionally, they generally have a greater awareness of international food and drink trends, enhanced by their social media presence, which bodes well for the acceptance, awareness and consumption of alternative proteins.

Multiple initiatives underway, but UAE ahead of the game

In line with the strong driving factors mentioned above, the GCC region has seen significant alternative protein investment and product launches over recent years. Sovereign wealth funds have also increased their exposure to the alternative protein sector, especially in cultured meat, as governments seek to increase food security. 

The UAE has generally been at the forefront of corporate and government activity in alternative proteins (as highlighted below). Furthermore, the world’s largest food exhibition ‘Gulfood’ is taking place in Dubai in February and will help showcase the GCC’s rising demand for alternative protein and highlight the general push for sustainability in the Gulf food system. ‘Gulfood Green’ is the exhibition’s global sustainability initiative, which aims to ‘ignite and continue conversations within the wider community, to create a momentous shift towards more resilient and sustainable food production and consumption’. This will be particularly pertinent in the run-up to COP28, as the spotlight turns to the UAE, and the GCC region more widely. By raising visibility and influencing key strategic food industry champions, the objective is to set a precedent for the future and to encourage other industries and sectors to also take action to support sustainable food systems and address climate change.

ESG credentials under the spotlight

Going forwards, the alternative protein market will face increasing scrutiny in terms of its ESG credentials, specifically its environmental footprint and health claims, which could present headwinds for uptake.

As the market for alternative protein products continues to grow, there are increasing questions being raised about the environmental claims that these products make and how they can be substantiated. Consumers are becoming more interested in products that are sustainably produced and have a minimal environmental impact, and companies are under pressure to demonstrate that their products live up to these expectations.

In addition, claims that alternative protein products are typically healthier than conventional meat products are also coming under scrutiny. Many alternative protein products are highly processed and may contain high levels of fat, salt, and sugar. Over the coming years, there is likely to be greater regulation of these products. It will be important for companies to be transparent about their product’s nutritional content and to ensure that their environmental and health claims are accurate and can be supported.

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