Page 33 - FoodFocusThailand No.198 September 2022

SPECIAL REPORT
SPECIAL REPORT

Challenges of

the Market for

Alternative Proteins

from Novel Foods

The mounting pressure from the
current economic climate and the
rising costs of living has prompted
consumers to become more
cautious with their spending plans,
thus affecting the sales of necessary
goods such as food products, which
make up 36% of the total expenses
spent by Thai households.

Among said commodities are future foods, which also encompass these products is niche and small in number as it only comprises specific
alternative proteins derived from novel foods. These proteins, ranging types of people, such as individuals with active lifestyle, health or
from plant-based, algae-based, and insect-based proteins to natural balanced-diet awareness, and environmental consciousness. They, too,
mycoproteins, are processed and manufactured by means of advanced may adapt their shopping behavior according to the changes in their
technologies with the objective to assimilate the flavors, textures, and purchasing habits.
appearances of their traditional counterparts. Apart from consumer’s purchasing power and competition with
The alternative proteins from the novel food innovation are one of traditional proteins, the alternative proteins from novel foods also face
the popular food trends among the new generation consumer, and their the following major challenges in 2022:
growth can be credited to consumer’s increased awareness of 1) Higher competition due to increase in sellers and possible
environmental impacts, health trends, and increase in sales channels, adverse impacts on SMEs
namely modern retail stores, online shopping platforms, and restaurant Larger enterprises enjoy higher flexibility, which allows for more
businesses. Furthermore, the rise in product choices, sellers, and effective business adaptation. Their comprehensive manufacturing
consumers also vitally contribute to the expansion. Among the new systems, economies of scale, and country-wide sales networks keep
consumers are the flexitarians, a group of individuals who strive for their costs down, leading to more competitive prices. SMEs, on the other
lower meat consumption when convenient and appropriate opportunities hand, face the polar opposite situation where they are hindered by limited
arise. However, the relatively higher costs underlying the alternative accessibility to consumers and higher manufacturing or marketing costs,
proteins, especially in comparison with those of the traditional ones such as gross profit (GP) charged by food delivery platforms. Hence,
that are widely available in the market, along with consumer’s limited the dynamics of the industry are expected to come from bigger food
purchasing power and tighter budget, have become an obstacle to the enterprises, while players of smaller scale may need to form their own
attempt to push sales and expand the client base for novel food, alliances for improved negotiation leverage or to consider partnering
alternative proteins. This is especially true for consumers with low-to- with larger corporations to bring more competitive edge to their
middle income. On top of that, the target group of Thai consumers for businesses and help contribute to further growth of the market.

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