Cultivated meat is closer than we realize. Diving into the obstacles and opportunities as it makes its way to market
Hi Climatic Thoughts readers! I'm Lisa, here with a guest post on a meaty topic that may very well be coming to a dinner plate near you soon. Read on, and I promise I’ll keep the puns to a minimum.
The beef with meat
We all eat, and we can all eat better, for our bodies and for our planet. Eating is low on Maslow’s hierarchy and high on climate impact. It’s no wonder that Project Drawdown ranks plant-rich diets as the second most impactful solution in terms of reducing heat-trapping gases. This is due to the high resource intensity of producing meat in our current food systems. Livestock produces less than 20% of the global calorie supply, but utilizes more than 70% of global farmland.
The demand for meat though, is only growing. Developed countries have seen a rise in animal-based protein consumption for the last 60 years, and the US is the global leader. In developing countries, the appetite for meat will only continue to increase as GDP levels rise and consumers’ diets move up the food chain. Realistically, convincing a large enough subset of meat eaters in developed and developing countries alike to reduce or eliminate their meat consumption is implausible. Therefore, without innovating more efficient ways to raise livestock or creating suitable meat alternatives, our global food security and our planet will remain in peril.
Alternative meat companies, such as Beyond Meat and Impossible Foods, have already made strong headway in bringing plant-based meats to consumers. Their animal-free options mimic not only the way meat tastes, but also the way it smells, feels, cooks, and even bleeds. Cultivated meat companies (or lab-grown, cultured, cell-based…the nomenclature is still up for debate) are taking it to the next level.
An (brief) introduction to how the sausage gets made
Cultivated meat is made up of real animal cells. Does that make it real meat? Well, you can decide for yourself. Making cultivated meat is not an animal-free process, but it can be a slaughter-free process. It starts with extracting stem cells from a living creature, which can be a minimally invasive procedure. These cells are put in a bioreactor and fed all the nutrients (e.g., sugars, amino acids, proteins) needed to proliferate. As the cells cultivate, scaffolding helps create the structure and texture of meat by cueing cells to become muscle, fat, and connective tissue. They are what turns cultivated meat from mush into marbled steak; less structured products such as ground meat or hot dogs require less complex scaffolds. After a few weeks, the cells are harvested and processed into the meat products that end up in our grocery stores and on our dinner plates. While the exact climate impact is still pending as researchers continue to make process improvements, initial projections estimate cultivated beef to require 45% less energy and 99% less land, and generate 96% fewer greenhouse gas emissions than traditional beef.
Though the first cultivated burger was created and consumed nine years ago, there are a few more hurdles to overcome before you’ll be able to find it on your local grocery store shelf or restaurant menu.
Obstacle 1: Achieving price parity
For many types of cultivated meat products and cuts, achieving taste and texture parity with conventional meat is well within sight, if not already accomplished. What’s harder to achieve is price parity. The first cultivated burger cost $330,000 to research and create. Now, the cost to produce a cultivated patty is below $10, which is still significantly more than a conventional burger, but quickly nearing a palatable price point.
The crux of getting to price parity is establishing a robust ecosystem of players within the space. The issue with the majority of cultivated meat players today is that their operations are almost entirely vertically integrated across the R&D process, from bioreactor design to cell culture media to scaffolding. In nascent industries, vertical players with high integration and robust IP often dominate early on. But as industries mature, fragmentation begins to occur and specialized, horizontal players start coming in. These B2B companies offer efficiencies in the manufacturing process that can help drive down the overall cost of the product. Startups, such as Micro Meat which is focused on creating scaffolds, are beginning to build out the B2B ecosystem for the industry, but there remains a chicken and egg problem: More ecosystem players are needed to achieve economies of scale, but B2B companies are hesitant to enter until customer demand is established, the value chain is standardized, and the end product itself is at least revenue-generating, if not profitable.
While startups focused on delivering the end consumer product are still the most well-funded and recognized players in the industry, receiving the majority of the $1.38B poured into the industry last year, more innovation and investment in specialized suppliers along the cultivated meat tech stack will be crucial to moving the entire industry to a scalable, competitively priced future.
Obstacle 2: Gaining regulatory approval
In the US, the process for gaining approval for cultivated meat in the US is its own maze to navigate. The delineation of scope between the US Department of Agriculture (USDA) and the Food and Drug Administration (FDA) is murky at best. Broadly speaking, the USDA regulates meat, poultry, and egg products, whereas the FDA oversees everything else - which includes fish, exotic meats, and all processed foods. A few examples where the lines are heavily blurred (and a worthwhile tangent because the absurdity is so clear): The USDA covers egg products (e.g., egg whites, powdered eggs in food processing); the FDA is in charge of whole eggs. The USDA regulates open-faced packaged sandwiches with meat; the FDA approves closed sandwiches – meat between two slices of bread.
After a battle between the two agencies for regulatory oversight of cultivated meats, in 2019, the USDA and FDA agreed to joint regulation. Collecting, banking, and growing cells into tissue will be under the remit of the FDA whereas safety inspections of turning the tissue into meat and product labeling will be managed by the USDA. Industry optimists are hopeful that regulation will come by the end of the year, but we may have to be patient for just a bit longer. Like any effort in the good ol’ American political system, lobbyists on both sides are geared up and ready for a fight.
Globally, only one country has approved the sale of a cultivated meat product: Singapore. In December 2020, as part of the nation’s food security plan to produce 30% of its food domestically by 2030, Singapore approved US-based Eat Just’s cultivated chicken products. So far, no other government agency has yet to follow suit with approval, though regulatory review is underway across nearly every continent.
When it comes to developing nations, China released its five-year plan this past January, which serves as the foundation for setting the country’s vision, priorities, investments, and policy development for the next 5 years. Cultivated and plant-based meats were mentioned for the first time, though explicit regulation has not yet been announced. Given the tremendous consumer buying power (and potential R&D and manufacturing capabilities) of these nations, the industry needs to keep a close eye on global policy decisions.
Obstacle 3: Earning consumer acceptance
With affordably priced products and regulatory approval, the last frontier for cultivated meat will be winning over consumers and their stomachs. This may prove to be the marketing challenge of the century.
The biggest hurdle to overcome will be the “unnaturalness” of cultivated meat, but the power of marketing can be nearly limitless. Through well-funded, seamlessly executed marketing campaigns, US consumers have been convinced that meat is manly and organic foods are healthier. They’ve changed their mind on alligator pears (re-branded as avocados) and the Patagonian toothfish (now known as Chilean sea bass).
But as we’ve seen with the raging debate on GMOs, consumers still have a huge preference for “natural,” even if they might not be fully informed on what that means and whether it is actually healthier. Cultivated meat faces the same stigma. One potential solution is for cultivated meat companies and interest groups to focus on the competition – to invest heavily in exposing the “unnaturalness” of the factory farming process, from living conditions to antibiotic use. One study actually found that diving deep into how cultivated meat is made had the inverse effect of pushing consumers more towards traditional meat. In the end, the biggest threat to mainstream acceptance of cultivated meat might not even be the farmers and meat producers – it might be the environmentalists. In the same way that activists initially fought hard against nuclear power, cultivated meat could face the same battle with tree huggers who tout that all-natural and organic are the only way to go.
In developing markets with less sophisticated consumers, a different marketing play is needed. As these countries and their consumers become wealthier, eating meat moves from being aspirational to being attainable. People in places that currently have very little meat in their diets could potentially leapfrog traditional sources and go straight to cultivated meat products, in the same way many developing nations have leapfrogged the PC era and gone straight to mobile. Here, cultivated meat companies can position the product as a premium option that is engineered to perfection and higher quality than farmed meat, and even leverage the existing aspirational perception of the West. Reduced emissions from the broad adoption of cultivated meats would simultaneously help developing nations, which are most at risk from climate change.
Ultimately, consumers will be forced to reckon with their own moral definitions of what they want to put in their bodies. As the gap between the individual and our agricultural systems widens, we become increasingly removed from the process that puts the actual food on our plates. But when presented with options we’ve never had before, such as the choice to buy a cultivated chicken breast rather than a traditional one, we must think about where both of those options come from. For vegetarians who are opposed to animal slaughter, is cultivated meat an acceptable substitute? For those with religious beliefs about meat, can cultivated meat be considered kosher or halal? For those who are compelled by the environmental impact, would cultivated insect meat (that tastes like seafood) be an even more efficient, low impact protein source? Sooner rather than later, we’ll be faced with these questions as we stroll down the aisles of the grocery store, choosing what to buy for our next meal. Companies in the cultivated meat space have an opportunity to help answer these questions and guide consumer choices.
What’s next on the menu
From a research and regulatory perspective, we’re right around the corner from seeing cultivated meats available to consumers around the world. The science is proving that the question is not what can be cultivated, but what can’t? As companies move towards commercialization, ruthless execution as well as significant investment in consumer education and marketing will be critical in whetting consumers’ appetites for the meat of the future.