US- JBS SA, the largest beef supplier in the world, is set to bring its US plant-based operations to an end in favor of expanding markets for alternative proteins in Europe and Brazil.
Operating as Planterra, the plant-based division of JBS, debuted its OZO brand of meat alternatives in the US in 2020.
As recently as last month, the company was announcing expansion news, only for it to make a U-turn and initiate the process of winding down which is expected to be complete by December 20.
The 189,000-square-foot facility in Denver, Colorado where production was based will be shut down and an estimated 120 employees will lose their jobs.
According to the Denver Business Journal article, Planterra employees were sent home in the middle of the week.
Nikki Richardson, a JBS spokesperson, said in an emailed statement that the company is working with Planterra employees to find employment opportunities at other JBS locations.
“We continue to believe in the potential of plant-based options for consumers and remain committed to the alternative protein market,” Richardson said.
“JBS will focus its efforts on its plant-based operations in Brazil and Europe, which continue to gain market share and expand their respective customer bases.”
Plant-based meat sales have been declining for the past year or so. According to IRI data published by Bloomberg, the number of meat substitutes sold at shops decreased 10.5% over the previous year’s 52-week period ending in September.
Declining sales scare away Big Food
Planterra’s closure by JBS could mark the beginning of Big Food’s withdrawal from plant-based meat.
Kellogg is attempting to separate or sell its plant-based business unit, which also includes its MorningStar Farms brand.
Beyond Meat and Conagra-owned Gardein are also alternative protein companies seeing declines in 2022.
Beyond Meat reduced its annual net income forecasts and let go of around 40 workers, or 4% of its workforce to decrease costs after a year of failed goals and unstable development.
Additionally, this summer, Maple Leaf Foods, whose Greenleaf division manufactures Lightlife, Chao, and Field Roast, stated it will be 25% smaller.
Plant-based meat sales have been declining for the past year or so. According to IRI data published by Bloomberg, the number of meat substitutes sold at shops decreased 10.5% over the previous year’s 52-week period ending in September.
Inflation and disruptions in the supply chain are among the contributing factors. A recent Deloitte investigation reveals that there may possibly be consumer-driven factors at work.
The part of the US population amenable to trying (and repeat buying) “may already have reached a saturation point,” according to Deloitte, suggesting that the addressable market may be smaller than previously believed.
The advantages of plant-based meat substitutes are also being questioned by consumers, particularly those related to health.
Seven in ten customers in 2021, according to Deloitte, will prefer plant-based meat to animal goods. The percentage decreased by eight percentage points this year.
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