Plant-based proteins: A growth industry in Canada’s backyard

The world’s population is growing exponentially and so, too, has its demand for food.

In the past 200 years, humanity has exploded from an estimated one billion people to more than 7.8 billion in 2021. In some developing economies, that boom has led to a rising middle class and a parallel increase in demand for meat protein—often viewed as a luxury. At the same time, the middle class in developed countries are increasingly turning away from animal protein to plant-based alternatives.

With the global population expected to hit 8.5 billion by 2030, the Canadian plant-based protein industry is in a prime position to dominate the world market. In fact, a 2021 Protein Industries Canada (PIC) report conducted by Ernest & Young anticipates the global industry’s valuation will hit $185 billion by 2035. As demand for value-added protein alternatives grows, PIC is helping the alternative protein industry take a multi-faceted approach to increase its footprint domestically and on the world stage.

To firmly establish a presence globally, create jobs in Canada and leverage our international reputation for food safety and excellence, our focus at PIC is on moving beyond supplying the world with raw materials towards being a global leader in innovative and sustainable plant-based, value-added consumer goods.  

Created as part of the federal government’s 2018 Innovation Superclusters Initiative to create jobs, excellence in innovation and sustainable growth in industry, PIC has partnered with new and established companies to create more than 889 jobs, 200 new products and 77 new processes.

Main sources of vegetable proteins include the following:

• Oilseed protein: Soybeans, rapeseed/canola, cottonseed, peanut/groundnut, sunflower seed, sesame, safflower, flaxseed, linseed.
• Cereal protein: Wheat, corn, rice, barley, oats, sorghum, grain amaranth.
• Legume and pulse protein: Beans, chickpeas, guar, lentils, lupines and peas.
• Leaf proteins: Alfalfa, lucerne, tobacco, mulberry bush, grass, sugar cane, sugar beet, clovers.

Overall, the global demand for grains and pulses, including soy, peas, wheat, canola, oats and lentils, for the production of alterative protein is conservatively estimated to hit 41 million tonnes by 2035, with soy and pea farming taking more than half the market share. What does that mean for Canada’s agri-food industry?

As an increasing number of Canadians consider moving away from meat-based diets, there are several barriers to adopting plant-based protein options. 

1. The taste, mouth feel and texture of meat alternatives. Of those Canadians surveyed by AAL, 42.3% said plant-based products “taste strange.” Not surprisingly, one of the key reasons consumers favour one meat alternative over another is that the product resembles and tastes like meat. Success stories such as Beyond Meat and Impossible Burger, prove the relevancy of PIC’s focus on research and development (R&D) investment, innovation and agri-research. In other words, convincing Canadians to eat more plant-based protein doesn’t start with what’s on their plate—it starts in the lab.
2. Consumer reluctance to replace one raw material—animal protein—with another, like dried lentils, says Dalhousie University’s report. “Consumers need to be educated on the potential of plant-based proteins. While there are many ready-made meal options, consumers who want to have less process options may need to be taught how to prepare meals using plant-based proteins such as legumes, from scratch.” 
3. Lack of consumer education. Nearly 47% of Canadians admit they don’t buy these products—despite being in plain sight in meat sections of grocery stores—because they don’t understand all the ingredients. 
4. Higher costs. Processed plant-based products are more expensive than meat, preventing the wider adoption of plant-based proteins by Canadians. Those greater costs are passed on to consumers as a result of elevated R&D costs and limited economies of scale, particularly for smaller or emerging producers.

These barriers—and many others—are PIC’s main focus. Supported by $150 million in government funding, we’re co-invested with private companies in R&D to build Canada’s strength as a commodities powerhouse through a self-sustained, eco-system built on innovation. It’s something of a personal mission: Every person on our senior leadership team grew up on Prairie farms and many of us are still involved in our family’s farming or ranching operations.

One of our key partners is Export Development Canada, which leverages their resources to identify and target new markets. As the international risk experts, EDC works with agriculture organizations and in 2020, facilitated more than $5.6 billion in transactions in support of Canadian agriculture. Leveraging the Canadian agriculture industry’s reputation for safe and clean agri-products, EDC helps with risk management, financing and working capital. 

Through our partnerships, PIC is accelerating Canada’s transformation from commodities producer to value-added product producer, using four main priorities: 

1. Create:  Advanced technologies with investments aimed at improving processing efficiencies and developing novel food ingredients.
2. Grow: Technology, predictive analytics, automation and sensor technology to improve production efficiency, sustainability, and cost reduction. 
3. Make: Improvements to current processes and develop new tech and products that allow companies to scale and attract investment. 
4. Sell: Into new markets by building on Canada’s brand advantage.

Canada’s established reputation as an international agricultural leader is just one part of our value proposition in becoming a global presence in the plant-based food sector. 

The industry also has access to an expanded domestic market through the United States and Mexico, as well as Asia and the European Union. For example, the Canadian agricultural industry’s reputation for food safety marries well with stringent food safety guidelines in the Eurozone. 

Moving forward, PIC is working on solutions to help new and established companies facing challenges in this agri-sector. They include:

• establishing a regulatory environment that supports innovation; 
• attracting increased capital investment; 
• supporting collaboration; and 
• building access to labour, skills and talent to support business initiatives. 

Through partnerships with government agencies, like EDC, our goal is to build the capacity, infrastructure and innovative thinking to put Canada’s agri-food industry on every table worldwide.