The alternate protein market has been constantly evolving since the early 2000s. However, when the pandemic hit, there was a spike in the demand for alternate proteins. This is because of a considerable shift in consumer behavior with an inclination towards veganism.
When talking about the market trends, the alt-protein market stands at a value of approximately 16.5 billion USD in 2024. Moreover, it is expected to grow at a CAGR of 9.4% from 2025 to 2027. In 2023, global investments in alternative protein reached $1.67 billion, out of which the US alone raised $555 million.
In the league of most popular leading alternative proteins, soy is the first choice, followed by the pea protein. However, soy entails some health concerns, which has affected its demand. The major concern is its phytoestrogen content, which leads to potential hormonal imbalances, especially in individuals who are sensitive to estrogen or have hormone-related conditions.
The US is the leading nation in the alternative protein industry, with over 380 companies in the sector. Interestingly, India has over 200 startups and well-established companies, such as Nestlé and Hershey’s, that are involved in the alternative protein industry. Meanwhile, in the EU, countries like Denmark and Germany have also made significant investments in the alt protein sector.
The Evolution of Alternative Proteins: The Trends Around The Protein Sources
A Shift to Newer Sources
Initially, the alt protein trend started with plant-based sources such as soy, fava, pea, and legumes (lentils, chickpeas). With time, particularly from the 2020s, the companies’ focus gradually shifted to sources such as algae, cell culture, seaweed, and fungi. For instance, Catchfree, a start-up focusing on plant-based seafood, has developed plant-based shrimp made from microalgae. In another such instance, (Berlin), a start-up, has launched a substitute for salmon fish. The product is called SAL-NOM and is derived from seaweed.
One of the main reasons for this shift is the sustainability factor. Though soy and pea based proteins are sustainable compared to animal-based proteins, their large-scale farming leads to deforestation. Furthermore, these sources have significant supply chain vulnerabilities such as extreme weather, including droughts and floods, which in turn can damage the crops and reduce supply. At times, the countries that source these crops may encounter political problems such as trade disputes or changes in government policies, thereby making it harder to get the products on time and at a reasonable price.
Coming to the scaling up of the production of these new sources of protein, significant collaborations and investments happened in mid-2024. One such example is MATR Foods, a Danish food tech startup, which received a major investment from Novo Holdings (Denmark). MATR uses mycelium (fungal roots), a traditional fermentation method, in the production of its meat alternatives, such as MATR Fungi Mince. Another example is Umaro Foods (USA), which specializes in plant-based bacon made from a proprietary red protein derived from seaweed. It received $3.8 million of investment through equity and grant funding to expand its product offerings. A collaborative example can be that of Metaphor Foods (Australia) with Kinoko-Tech (Israel), a food tech start-up company. This partnership will enable Kinoko-Tech to produce large-scale fungi-based food products in Australia from 2025.
A Comeback of Traditional Protein Sources
Another emerging trend is the resurgence of traditional plant-based protein sources. Food companies are introducing innovative launches in the alternative protein market, utilizing a diverse range of protein sources. For example, Ingredion (USA) has launched VITESSENCE® Pea 100 HD, a new pea protein designed to improve the texture and taste of cold-pressed bars. A plant-based company based in the US called Axiom Foods (USA) has recently scaled up the production of its 2 products, better-tasting pea protein, Vegotein N.
Sproud (Sweden) has launched pea milk called Barista Zero. Ohly (Germany), a yeast derivatives supplier, has launched a new range of yeast-based bio-nutrients. These bio-nutrients are designed to improve fermentation processes used in cultivated meat, protein, cheese, and dairy alternatives. Veganz (German) has launched an alternative to regular minced meat called Peas On Earth.
Air Protein
Air protein is the latest talk in the market. The main source of air protein is carbon dioxide (CO₂). The process of making air protein involves fermentation, in which special bacteria or microbes consume CO₂ along with water and renewable energy in bioreactors, which gives an end product known as single-cell protein (air protein).
Solar Foods (Finland) developed solein, a protein made from air, appropriate for foods such as pasta, dairy, and confectionery, which is now making waves in the market. For example, Ajinomoto (Japan) has collaborated with Solar Foods to create innovative desserts using solein. These include traditional flowering mooncakes and ice cream sandwiches. The product Solien got commercialized in Singapore and received novel food approval in Singapore in 2020, and recently it has also entered the US market.
Upcycling via Fermentation
Upcycling has been a top trend in 2024, but upcycling via fermentation is something new. A new technology developed by BioMush (Finland), which is called solid-state fermentation, uses fungi to transform food waste and by-products into ingredients with a rich umami flavor. Danish Technological Institute’s project named Zest focuses on using edible mushrooms to ferment agricultural by-products like sugar beet residues, leftover grains from brewing, and fruit peels to produce protein. Israeli startup Yeap has received a 10% investment from Lesaffre, a global leader in fermentation products, to create proteins made from upcycled spent yeast for the plant-based food market.
The Role of Fermentation Technology in Alt-Protein Production
Fermentation is currently the most widely used technology in protein processing. Within fermentation, there are several types, with microbial/yeast fermentation and solid-state fermentation (SSF) being the most popular and long-established methods. Both methods produce similar types of proteins, such as yeast proteins, mycoprotein, animal-free dairy proteins, and enzyme-rich proteins. Companies have been relying on these methods for a considerable amount of time due to their effectiveness and versatility. Mycoprotein is one of the most popular alternative proteins in the market, and this is produced by growing Fusarium venenatum fungus in fermenters, which produce fungal cells. The Quorn™ was the first brand to experiment with mycoprotein and is planning to introduce blended products combining their mycoprotein with real meat, aiming to launch these items in early 2025; however, the exact date has not been officially announced yet. There are two main methods for large-scale production: solid-state fermentation (SSF) and submerged fermentation (SmF). Established brands invest in mycoproteins either through collaborations or by continuing to launch alternative protein products using mycoprotein. Earlier this year, Cargill collaborated with Enough to scale the production and commercialization of mycoproteins. Cargill provides sugars from sustainably sourced grain (basically, food for the fungi) that Enough uses in its fermentation process to grow mycoprotein. Cargill has signed an agreement to buy and market Enough’s mycoprotein, which is a product named Abunda.
Precision fermentation is a relatively new technology in comparison to traditional fermentation and is making waves in the alt-protein market. This technology uses genetically modified organisms (GMOs) and bioengineering, which is a new approach in the market. This basically means that the microorganisms used in the fermentation process, such as bacteria, yeast, or fungi, are genetically altered to produce desired proteins that wouldn’t naturally be found in those organisms. This technology is one where almost every company is involved in investments. Liberation Labs (US), a biomanufacturing company, received a $3.5 million investment from Agronomics Limited (UK). The company is working on precision fermentation technology, which is a new and emerging field, and their plan is to build a precision fermentation plant that will scale biomanufacturing. PHW Group (Germany) is set to launch a new subsidiary later this year that will specialize in both traditional and precision fermentation. The subsidiary will focus on creating ingredients for alternative protein products. Danone (France), Michelin (France), DMC Biotechnologies (USA), and Crédit Agricole Centre (France)—all three companies have collaborated with the Biotech Open Platform. This new center will focus on precision fermentation, a technology that can help develop sustainable alternatives to animal and fossil-based products.
Companies are exploring the use of AI in precision fermentation. AI is being explored to monitor and control fermentation processes to improve the consistency and quality of alt protein, and AI is also helping to gather detailed data, allowing for real-time adjustments to improve fermentation. Konica Minolta, a Japanese tech company, is partnering with Planetary to use AI to improve the production of proteins made through precision fermentation. Scientists at Imperial College London are using AI to improve yeast strains and make precision fermentation more effective.
Precision fermentation is a versatile method for protein processing that companies are now using for novel egg alternatives. Onego Bio (Finland) has raised $15.2 million from the European Innovation Council (EIC) Accelerator. The company produces Bioalbumen®, a bioidentical egg protein made without animals that is used as a food ingredient. Grupo Empresarial Palacios Alimentación (Spain) egg producer has collaborated with biotech company The Every Company (US). As part of the agreement, Palacios will use EVERY Egg, the world’s first liquid egg product made using precision fermentation, in its Spanish omelets and in developing new products.
Along with egg alternatives, precision fermentation has also made the production of sweet proteins much easier. Just like egg protein, the making of sweet proteins through fermentation is also a novel concept. Sweet proteins, such as Thaumatin and Monellin which are derived from fruit, are gaining attention. With the ongoing trend of sugar reduction in the market, we can expect significant investments and collaborations in plant-based proteins. For example, Shiru and Ajinomoto have partnered to develop and commercialize sweet proteins. Oobli has recently received approval from the US Food & Drug Administration (FDA) for its sweet protein, Monellin.
The advancements in fermentation technology are focused on precision fermentation. Hydrosome Labs has developed ultrafine bubble technology. These tiny bubbles, called nanobubbles, are so small they can’t float to the surface like regular bubbles. Instead, they stay suspended in liquids and help improve the delivery of nutrients and gases to cells during fermentation, especially precision fermentation, making the process more efficient.
Conclusion
In the alternative protein market, companies are now focusing on balancing traditional protein sources like soy and peas with emerging innovations such as microalgae, air proteins, and fungi. It shows that the industry is committed to sustainability while keeping evolving consumer preferences in mind.
Among all the fermentation technologies, precision fermentation stands out as a key one. It’s becoming a priority for many companies, with major investments and collaborations happening across the globe. This is mainly because of the versatility of this technology; precision fermentation is highly efficient in producing high-quality proteins. One new trend is that vegan eggs are becoming popular these days, and this technology is ideal for producing egg whites (albumin); moreover, precision fermentation can produce consistent results on a large scale, making it ideal for commercial applications. So, looking ahead, we can expect precision fermentation technology to dominate the alt-protein sector in the future.
This article was originally published in Nutraceutical Business Review Magazine.
