Recently, the share price of beyond meat, the “first artificial meat stock” that Bill Gates had bet on, fell 90% from the highest point, and the loss in the first quarter expanded to $100million.
Behind the “double whammy” of share price and performance of beyond meat is the sharp drop in the global artificial meat market.
It seems that the artificial meat previously looted by capital seems to be full of foam like bitcoin. Now capital has also lost patience and enthusiasm, because artificial meat has too many difficulties to overcome in taste, technology, price and other aspects. Some netizens vividly pointed out that although artificial meat is more expensive than meat, it is not even as good as spicy meat.
However, almost at the same time as the stock price of beyond meat plummeted, the national development and Reform Commission mentioned in the “14th five year plan” for bioeconomy development that the orderly development of biological breeding technologies such as genome-wide selection, systems biology, synthetic biology and artificial intelligence, the development of synthetic biology technologies, and the exploration and development of new foods such as “artificial protein”.
As soon as the news came out, the shares of A-share “artificial meat” enterprises such as Shandong Heda, Shuangta food, Huabao, Dongbao biology and Chengzhi rose collectively.
Because artificial meat is a kind of “artificial protein” food.
The same thing has encountered two different fates at the same time, and the reasons are worth analyzing.
Full of foam like bitcoin?
May2,2019 must be a day of shock to the stock market.
On that day, the artificial meat head department beyond meat was listed on Nasdaq, and its share price soared 163% on the same day, the highest increase on the first day of listing of companies with a market value of more than 200million since 2000. By the end of July of the same year, its share price had tripled, becoming the “first stock of artificial meat”.
Michael Novogratz, an early investor of bitcoin, believes that:
“Investors’ enthusiasm for beyond meat, the ‘first stock of artificial meat’ in the United States, is just like the peak of the bitcoin foam.”
Two weeks later, another artificial meat giant in the United States, imposible foods (if), obtained financing of up to US $300million from the Victoria Harbour investment of Li Ka Shing, the richest man in Hong Kong.
The artificial meat went out of the circle like a fire. The fire of this new industry with a scale of 10 billion yuan has spread from abroad to China.
Shuangta food, a leading enterprise of vermicelli, has become a derivative of vermicelli – pea protein. Now, its purification of peas has reached 88%, becoming the world’s largest supplier of pea protein, with a market share of 40%.
Traditional vegetarian brands, such as Sulian, Hongchang and Qishan, have also started to lay out artificial meat and develop artificial meat products with the help of the inherent soybean protein industry chain and technology.
Traditional meat products companies, such as Shuanghui and JINZI ham, have also entered the market. At the beginning of 2020, Shuanghui purchased part of the equity of six meat related companies for 730million yuan; Luo Yonghao, the online celebrity, brought the new product “golden plant sausage” of the golden ham artificial meat series in the live broadcasting room.
Of course, these are just old companies developing new businesses, and start-ups are springing up like mushrooms.
Founded in 2019, Zhou zero has won three rounds of financing in seven months. In just three years, Zhou zero has reached cooperation with more than 100 brands across the country, and its products have entered more than 30000 stores across the country.
At the same time, rare meat is also emerging. In the Mid Autumn Festival of 2019, rare meat took the lead in launching the world’s first artificial meat moon cake, and 3000 moon cakes with limited sales were sold out in the pre-sale period;
Hey Maet came from behind. It was established in April, 2020. In August, it completed nearly ten million yuan of seed round and angel round financing, and in December, it completed tens of millions of pre-A round financing.
At the same track, there are paoding zaorou, Weishida, Nestle’s Jiazhi cuisine and so on.
Picture source: drawing of prospective industry research institute
You may want to ask, is it not good to eat meat directly? Why do you want to make artificial meat?
Eating meat directly is really delicious, but the disadvantages of eating meat are also visible to the naked eye.
With the publicity of various capitals, artificial meat has become the representative of healthy diet in the future. Compared with traditional meat, artificial meat is free of cholesterol, hormones, trans fatty acids and antibiotics, and is rich in essential amino acids.
Eating artificial meat is not only healthy but also environmentally friendly. According to the beyond meat prospectus, the production of 1kg of plant meat is equivalent to saving 93% of land resources and waste, 99% of water resources and 90% of greenhouse gas emissions for the environment.
Image source: drawing on Sunday zero
It is said that the future of healthy, environmentally friendly and capital assisted artificial meat is bright, but it seems that this is not the case when looking at the beyond meat share price.
Beyond meat’s share price has been falling since it reached its peak at the end of June last year. Now, the share price is 90% lower than its peak.
Not only did the share price crash, but also the performance fell. According to the financial report, the net loss of beyond meat in the first quarter expanded to USD 1005million from USD 27.27 million in the same period of last year.
Beyond meat share price
Picture source: Baidu stock exchange mapping
As a pea protein supplier of beyond meat, the performance of Shuangta food also declined. The first quarter report disclosed by the company on April 19 showed that the revenue in the first quarter was 449million yuan, a year-on-year decrease of 4.06%; The net profit was 51.48 million yuan, a year-on-year decrease of 48.3%.
In addition, the sales performance of artificial meat brands on all major platforms seems to be unsatisfactory.
From the perspective of tmall channel, there are only more than 4000 fans in ZhouLing food flagship store. The biggest popular product is protein bar, with a sales volume of only 700+, but it is not a plant meat product; Beyond meat stores only have more than 10000 fans, and more than 500 people pay for the best-selling products; The artificial meat and plant patties previously sold in Jinhua JINZI ham flagship store have been taken off the shelves.
How did the upstarts in the industry who once made a fire and made Bill Gates and Li Ka Shing invest and bet one after another go downhill?
Let’s start with its industrial chain.
Trapped in technology and market
In fact, there are two kinds of artificial meat, one is plant meat, and the other is animal breeding meat.
Plant meat is a kind of food that is similar to the taste, taste or appearance of animal meat by using the plant protein of soybean, pea and other key technologies such as mixing, extrusion and cutting.
Animal breeding meat is an artificial meat with traditional meat structure, flavor and taste, which is cultivated by using pluripotent stem cells in animal muscle cells in the culture medium under specific culture conditions.
At present, 99% of the artificial meat on the market is plant meat, and the cell culture meat is still in the laboratory, so we only talk about the plant meat industry chain.
Chinese plant protein value chain and main players
Image source: Roland Berger cartography
The upstream is naturally the supplier of raw materials and ingredients. The main raw materials are soybean protein and pea protein. The ingredients are mainly adhesives, flavorings, colorants, etc. required for the production of plant meat. For example, cellulose ether, which improves the taste of plant meat, is mainly produced by Shandong Heda.
There are generally two types of enterprises in the midstream. One is a start-up company with technology and R & D team, but no funds, such as weekday and rare meat.
The other is an established company in the traditional vegetarian or traditional meat industry that wants to expand its business. It has capital and factories, but does not have artificial meat technology, such as Sulian, Shuanghui, etc.
So they hit it off and started cooperation. The start-up companies provided technology and the old companies processed it on behalf of them. Of course, there are also some old-fashioned companies that simply take shares in start-ups. Under such a mechanism, midstream enterprises produce finished or semi-finished plant meat for downstream enterprises.
Downstream are tmall, HEMA, jd.com, and Starbucks, KFC, McDonald’s, etc.
Of course, upstream, middle and downstream enterprises are not always clear-cut, and may expand to the upstream and downstream more or less. For example, Shuangta is both a pea protein supplier and an independent producer of plant meat; Sunday zero has gradually formed its own factory in recent years.
Most companies mainly use soybean protein in their plant meat because of its high protein content and good gel properties, which makes it easier to produce the fiber texture of meat, and its amino acid composition is very close to human needs.
Source: Shenzhen national high tech Industry Innovation Center
The mainstream foreign soybean protein suppliers in the market include American ADM, DuPont, etc. the origin of soybean protein isolate in China is mainly in Shandong, accounting for 80% of the national market share. The representative enterprises are Yuwang ecology and 3D. However, due to China’s low soybean output and heavy dependence on imports, domestic soybean protein suppliers are at a disadvantage in terms of production capacity.
When it comes to pea protein, we have to mention double tower food. Shuangta originally mainly produced vermicelli. The protein and fiber produced in the process were used as farmland fertilizer and animal feed.
After the rise of the concept of artificial meat, the twin towers began to increase research and development efforts. As a result, in 2019, its edible protein accounted for 25% of the total revenue, surpassing the production of fans and becoming the main business of the twin towers.
Comparison of the proportion of various businesses
Source: 36 krypton mapping
However, compared with 30% protein content in soybeans, the protein content in peas is only 2%. Only 10000 tons of peas can be processed to obtain about 200 tons of pea protein, which directly limits the large-scale expansion of the twin towers.
Soybean protein is mainly supplied from abroad, and the protein content of pea protein is too low. In general, the plant meat industry chain in the Chinese market is not dominant in the supply of raw materials, which may be a major factor leading to the high cost of plant meat in the later stage.
From the midstream perspective, traditional meat products companies represented by Shuanghui are entering the artificial meat market through investment or strategic cooperation. However, the problem is that they do not master the core technology of plant meat manufacturing, and the separation of research, production and marketing is bound to further increase the cost of plant meat.
Source: foodplushub drawing
The disadvantages of protein supply and the separation of research, production and marketing have virtually increased the cost of plant meat, but the main reason for the high cost of plant meat is the production technology itself.
After the start-up was established in 2019 on Sunday, it won four rounds of financing in just over a year. In January this year, it won another round of B financing with an amount of 100million. Its important core competitiveness is to have its own R & D team and master core technologies.
On Saturday, he cooperated with Beijing Industrial and Commercial University and other universities. The team leader was Professor Li Jian. As a scientist specializing in flavor research, he has undertaken one of the world’s 14 frontier topics on plant meat and cell meat of GFI, a well-known plant food promotion agency in the United States. He is the only one in Asia.
Also with the R & D team is hey Maet, who has received technical support from plant meat R & D experts from many well-known Ivy League colleges.
However, having a research and development team does not mean that the cost can be reduced, nor does it mean that the artificial meat produced can be liked by consumers.
Not only is the process complicated, but also whether it can be commercialized smoothly is a big question mark.
Take the core extrusion technology in the production of plant meat as an example. The extrusion temperature directly affects the elasticity, moisture and molding of meat. This technology alone has great differences among different enterprises.
In addition, in order to make artificial meat a kind of food, it is not enough to produce it only, but also to make it complete in color, flavor and type. If the extrusion technology determines the taste of plant meat, the factors that determine the taste of plant meat are much more complex.
It is definitely not good to improve the flavor of plant meat by adding meat essence, which is unhealthy again. Moreover, taking soybean protein as raw material, plant meat has a kind of beany smell, which is difficult to remove.
In addition, it is not easy to improve the color of plant meat. People have a deep-rooted understanding of meat. They can’t eat a piece of meat that doesn’t look like meat. How can they have an appetite. However, there are still some problems whether adding food grade pigments or synthesizing meat like colors by microorganisms.
These ring after ring technical problems directly push up the production cost of plant meat.
Take Hangzhou HEMA fresh meat as an example. A box of 230g new vegetarian plant “sauce beef” is priced at about 30 yuan, while nearly 500g fresh beef can be bought at the same price. On the tmall platform, a box of 226g beyond meat hamburger beef patty is about 26 yuan, while in a beef product tmall flagship store, 1000g beef patty can be bought for 99 yuan.
Poor taste and higher price than real meat make people interested in plant meat.
At present, no one buys a piece of vegetable meat to cook at home. They usually eat cooked vegetable meat in restaurants, such as KFC’s chicken nuggets; Or buy some quick-frozen semi-finished products online, such as ecobuyer’s light food dumplings and rare meat plant meat moon cakes; Or some snacks, such as chicken fillet of hey Maet. These plant meat can only be called food.
Why is that?
Kiki, founder of Sunday zero, said in an interview:
“Catering brand cooperation is a relatively light way. Consumers can experience it after sitting down. There is no need for any cooking. The experience threshold is low. When guests experience it, it is a dish. People will not have a bad impression of it after they buy it and cook it.”
Based on this concept, most plant meat start-ups adopt the B2B2C sales model.
What this model lacks is exactly the biggest meat consumption scenario for users: buy a piece of meat at home and make it yourself.
The reason why capital and the market do not love meat making is that the current plant meat only captures a small part of the consumption scenarios such as catering chain or snack quick freezing, and the product form is nothing more than meat cakes, minced meat, meatballs and other forms with limited late processing range and specific uses.
Consumers also habitually define vegetable meat as snacks and side dishes rather than food and ingredients. This is far from the future meat conceived by capital, which can replace traditional meat and truly integrate into people’s lives.
Of course, B2B2C sales model is probably just a compromise of major brands to the current situation. In fact, they are secretly trying to develop their own technology.
The 1.0 era of adding essence and pigment to simulate the flavor, appearance and taste of meat by means of bonding substances; To the 2.0 era when natural molecular technology was used to make plant meat have meat characteristic flavor; Then to the 3.0 era in which the characteristic flavor of animal meat oil was simulated by using the technology of directional oxidation of plant fatty acids. Today, plant meat is moving towards the 4.0 era of simulating muscle fiber through wet extrusion and protein directional arrangement and reorganization.
Such vegetable meat will be presented to consumers in the form of a whole piece of meat, with a qualitative breakthrough in taste, and a wider range of consumers.
However, at present, the share price of artificial meat trapped in technology and market has fallen. Even if it has been brilliant, it can not rival the world of the market.
Why should the Chinese vigorously develop artificial meat?
In the middle of May, when the shares of American Meat enterprises such as beyond meat plummeted, the national development and Reform Commission
In the “14th five year plan” for bioeconomy development, it is mentioned that biological breeding technologies such as whole genome selection, systems biology, synthetic biology and artificial intelligence should be developed in an orderly manner, synthetic biology technology should be developed, and new foods such as “artificial protein” should be explored and developed.
As soon as the news came out, the shares of A-share “artificial meat” enterprises such as Shandong Heda, Shuangta food, Huabao, Dongbao biology and Chengzhi rose collectively.
Because artificial meat is a kind of “artificial protein” food.
The artificial meat here does not only refer to plant meat, but also cell culture meat that is still in the experimental stage but can be expected in the future. In a sense, cell culture of meat is the focus of national development.
The latest report of Kearney Global Management Consulting Co., Ltd. shows that by 2040, the global market share of “artificial meat” will reach 60%, of which 35% will be cultivated in the laboratory, that is, “cultivated meat”, and the other 25% will be plant protein meat mainly based on plant-based substitutes.
So the question is, why should the state vigorously develop artificial meat when both capital and market are cooling down? This has to start with African swine fever.
On August 3, 2018, the Information Office of the Ministry of agriculture and rural areas announced that the first case of African swine fever in China had been confirmed in Shenbei District, Shenyang, Liaoning Province.
Panicked farmers began to sell a large number of live pigs, leading to a decline in pork prices. Within a day, the price per kilogram fell by oneortwo yuan, but less than a month later, the price of pigs rose again.
How fast the pigs die, how fast the prices rise. In just five months after the outbreak of swine fever in China, 8 cases of culling of sick pigs, more than 900000 pigs, were reported publicly. In this process, pork prices across the country rose by 70-90%.
In order to maintain the stability of pig prices and ensure market supply, the state began to throw out the stored frozen meat. In the whole year of 2020, the reserve meat was put in 40 times, with a total of 720000 tons,
Although the reserve has been dumped for many times, it still has limited effect on curbing the rise in pork prices. Because the pork gap is too big. In 2017, the year before the outbreak of classical swine fever, the national pork consumption was 54.87 million tons, 720000 tons is really not enough.
It’s easy to kill a pig. You can kill it with a knife. Raising pigs is troublesome. It will take at least threeorfour years to recover.
Why did it take so long? Here is the concept of “pig cycle”.
Picture source: zhuochuang consulting drawing
In our opinion, a pig raising cycle is to buy piglets, raise them for half a year to one year, and then slaughter them. The cycle is half a year to one year.
However, this time, in addition to culling the piglets, the parents, grandparents and great grandparents of the piglets were culled together.
Generally speaking, in modern breeding, a pig cycle starts from the generation of great grandparents of pigs.
For a long time, the great ancestor pigs were mainly imported from abroad. Breeding companies in the United States, France, Denmark, Canada and other countries have cultivated great grandparent original breeding pigs with fast growth, high lean meat rate, large litter size and less feed after decades.
After the great grandparents expanded their breeding, they gave birth to their ancestors. The ancestral generation will expand reproduction and give birth to the parental generation. Generally speaking, the dominant performance of the original breeding pigs tends to deteriorate in the parental generation. The next generation cannot be bred as a breeding pig. It is a commercial generation for slaughter.
After the parents’ generation gave birth to 6-8 commercial generations, they were eliminated, announcing the end of a pig cycle. From the great ancestor generation to the commodity generation, a cycle usually takes 4 years.
The outbreak of classical swine fever in August, 2018 is a “mass extinction” that covers the four generations of pigs from the great grandfather generation to the commercial generation. It also takes four years to recover to the level before classical swine fever.
An emergency such as African swine fever still needs great efforts to use the most primitive method – culling and isolation. It will take a year to contain it. The cost is that 1/3 of the pigs are culled, the price of pork soars and the recovery in four years. This shows the fragility of pork security.
The traditional meat market with animals as the source of meat naturally faces animal public health problems. African swine fever is not the first and will not be the last.
In contrast, the whole production process of plant meat and cell culture meat is artificially controllable, which greatly reduces similar risks.
In addition to the problem of African swine fever, China’s meat imports have also increased year by year in recent years. China is already the world’s largest pork producer, but the supply still exceeds the demand, which is a growing gap.
Source: China Industry Research Report Network
From 2018 to 2020, the import volume of pork rose for three consecutive years, and the import volume in 2020 exceeded 10 billion US dollars. Not only pork, but also beef needs to be imported in large quantities. The root cause is that the “cattle bonus” is disappearing, and the beef gap is expanding year by year.
In the 20 to 30 years before 1979, the state made great efforts to develop animal power, and cattle were mainly used as draught animals. After that, the slaughtering policy was relaxed, the beef market demand surged, and the industry also entered a stage of rapid development. However, at this time, stock cattle were mainly slaughtered, and beef cattle breeding had not been vigorously developed. Whether big cattle, calves, bulls or cows, they were directly slaughtered and sold meat.
This has laid a huge hidden danger for the industry.
Since 2000, the “cattle bonus” has gradually disappeared, and China’s beef cattle breeding industry has been declining. Since 2007, Chinese beef prices have been rising all the way. The number of beef cattle on hand has declined from 130million in the 1990s to only 76 million by 2020.
In order to maintain the sustainability of the industry, the international safety line for the slaughter rate of beef cattle is 25%, that is, when 100 cattle are on hand, the slaughter volume cannot exceed 25. In the past, the slaughtering rate of beef cattle in China was as high as 40%. According to the data of the National Bureau of statistics, by the end of 2020, the slaughtering rate of beef cattle in China will still be above 32%.
What is more dangerous is that the number of cows that can be bred in China is also decreasing due to high risk, large investment, high cost and slow turnover.
In an interview with Holstein magazine in 2020, xushangzhong, chairman of the cattle branch of China Animal Husbandry Association, said that the number of breeding cows in China is far from meeting the development of domestic beef cattle, and at least more than 40 million cows should be added.
Under the premise of unbalanced development of beef cattle industry, we should try our best to meet domestic consumption demand. The beef production increased rapidly, but the beef consumption increased faster, and the gap between production and sales increased day by day.
According to the estimation of songchunhui, a professor of Jilin Agricultural University, the gap will reach 3.21 million tons by 2030.
Per capita beef consumption in China (2009-2019)
Picture source: drawing of cattle branch of China Animal Husbandry Association
Beef has to be supplemented mainly by imports, with an import dependency of 25%.
Whether from the perspective of the rising meat gap year by year or the fragile animal public health safety, meat safety is profoundly affecting China. Artificial meat, especially cell culture meat, is the hope to solve the meat crisis.
Cell culture meat is so powerful. What exactly is it?
Its core technology is aseptic operation technology and cell culture technology.
Firstly, muscle stem cells with high differentiation activity were isolated from animal muscle; Then the target cells were cultured and induced to proliferate and differentiate; Then, the growing skeleton was provided for further culture to induce the formation of multinuclear myotubes and further form muscle fibers; Finally, the muscle products obtained can be marketed after corresponding processing and packaging.
According to the concept of extracting stem cells, then proliferating and differentiating to form cell meat, theoretically we can cultivate any animal meat, and there are also some successful precedents in the laboratory.
Schematic diagram of cell meat cultivation process
Source: Cartography of Jiangnan University
It has been 90 years since it was proposed in the 1930s. At present, FMT, an Israeli cell company, is at the forefront of the world.
In 2019, the price of a pound of chicken bred by FMT laboratory was $150, but now it has dropped to $3.9, just one step away from commercialization.
It has been researched and developed for more than 90 years and has not yet been commercialized, indicating that the technology of cell culture meat is more difficult. It needs countless smart brains to continue to relay research, as well as adequate financial support.
If cell meat can be successfully commercialized, it will be worth it. Because the imaginative space and practical value of cell culture meat is far greater than that of plant meat.
The meat of cell culture contains solid animal protein, which is rich in all nutrients in animals. It is far more delicious and chewy than plant meat.
Only when the taste, taste and appearance of the meat made by such people are not inferior to the real meat, the cost is completely reduced, and the nutrition is richer than the real meat, can consumers establish their consumption cognition and recognition of it.
Just a preface
The words “carbon peak” and “carbon neutralization” must be familiar to us.
In short, carbon peak refers to China’s commitment that carbon dioxide emissions will not increase before 2030 and will gradually decrease after reaching the peak.
Carbon neutralization refers to the total direct or indirect greenhouse gas emissions by 2060, offsetting the carbon dioxide emissions generated by itself through afforestation, energy conservation and emission reduction, so as to achieve “zero emission” of carbon dioxide.
So, what do you think is the world’s largest source of greenhouse gas emissions?
Many people may not think that the answer is animal husbandry.
Source: FAO
According to a study released by the food and Agriculture Organization of the United Nations (FAO), the main source of greenhouse gases is animal husbandry. The annual greenhouse gas emissions related to the supply chain of animal husbandry amount to 7.1 billion tons of carbon dioxide equivalent, accounting for 14.5% of the total greenhouse gas emissions caused by human beings, more than the total emissions of vehicles.
Moreover, the waste of water resources, the occupation of land and the large amount of garbage produced by animal husbandry have caused great damage to the environment.
Data show that 5% of the water resources used in the United States are for household use and 55% are for animal husbandry; The garbage produced by 2500 cows is equal to the garbage produced by cities with 411000 people; Livestock farms already cover one-third of the world’s total land and more than two-thirds of agricultural land.
At this time, the significance of artificial meat is highlighted.
Compared with traditional chicken, pork and beef production, cell cultured meat can reduce land use by 63%, 72% and 81% ～ 95% respectively, and reduce global greenhouse gas emissions by 17%, 52% and 85% ～ 92% respectively.
This is an ideal goal. Only when the taste, taste and appearance of artificial meat are not inferior to that of real meat, the cost is completely reduced, and the nutrition is richer than that of real meat, can consumers really establish their consumption awareness of it.
Today’s artificial meat is just a prelude.
Read the original text