NEW YORK, Oct. 23, 2019 /PRNewswire/ -- It started with plant-based milk, then plant-based yogurt and now it's plant-based meat that's taking the spotlight, resulting in a massive valuation for meatless burger maker Beyond Meat (NASDAQ:BYND). In fact, the growing popularity of plant-based meats has attracted some of the largest food companies in the US, with Hormel Foods Corporation (NYSE:HRL), ConAgra Brands, Inc. (NYSE:CAG), and Tyson Foods Inc. (NYSE:TSN) all rolling out their own plant-based product lines to the market this year. And with more and more consumers becoming aware of the benefits of switching to a plant-based diet, the possibilities for the plant-based food market are seemingly endless. Now, Tel-Aviv based startup Else Nutrition Holdings (TSX-V:BABY) is looking to disrupt the $90 billion global infant formula market with its 100% plant-based, non-dairy, non-soy, hormone-free, gluten-free, non-gmo baby products.
While everyone else is looking at infiltrating the meat alternatives market, Else Nutrition Holdings (TSXV:BABY) is offering an alternative for this well-educated and 'wanting' $71 billion infant formula market with its 100% plant-based infant formula that imitates the nutritional gold standard composition values of breast milk, is medically-endorsed by leading pediatricians, and meets the strictest regulatory standards.
Plant-based foods are here to stay and the market is expected to continue on its upward trajectory for the foreseeable future. In the past year, plant-based food sales in the US increased by 11% to an impressive $4.5 billion USD, while the global vegan foods market is estimated to hit $24.3 billion USD by 2026. The leading drivers behind this growth are plant-based dairy and plant-based meats, with sales increasing by 39% and 37% respectively in the last year.
The Plant-Based Meat Market
The plant-based meat market alone is expected to grow significantly in the next few years at a CAGR of 14.8% to reach $30.92 billion USD by 2026. At present, the meat alternative market is being dominated by Beyond Meat (NASDAQ:BYND) since the company IPO'd in May. The company's shares have since skyrocketed from $25 up to $117 USD in just a few months. BYND's market dominance hasn't stopped other major players in the meat industry from jumping on the plant-based bandwagon. ConAgra Brands, Inc. (NYSE:CAG), the owner of Slim Jim, Orville Redenbacher, responded to the market by beefing up its meat-free product line Gardein. The company added several new items to its plant-based roster, including chick'n wings, tenders and nuggets, breakfast bowls, skillet meals, plant-based breakfast sausage and italian sausage patties, and meatless entree bowls.
Meanwhile, Tyson Foods Inc. (NYSE:TSN) is taking a different approach by teaming up with New Wave Foods to create plant-based shellfish. Once established, the company plans to roll out plant-based versions of lobster and crab. This isn't Tyson Foods first crack at meatless products. In August the company announced the launch of its Raised and Rooted brand which offers plant-based nuggets made from egg whites, pea protein, bamboo fiber and flaxseed, and a blended patties made with angus beef and pea protein.
Naturally, Hormel Foods Corporation (NYSE:HRL), the parent company of over 40 brands, had to get in on the action. In September, the company entered the market with its Happy Little Plants brand which offers a ground plant-based protein alternative made from non-GMO soy protein. Like ConAgra Brands, Inc., Hormel already offered a meatless option, the Hormel Fuse burger which was launched back in 2014. Apart from its new brand, the company has created plant-based pizza toppings through its subsidiary Burke Corporation.
Demand for Plant-Based Alternatives for Children and Babies on the Rise
While everyone is focusing on meat alternatives, another massive market is looking for plant-based options. The global infant formula market is on track to grow at a CAGR of 9.3% and reach $90 billion USD by 2025. Some of the key drivers behind this expected growth include a rising awareness among people and an increasing demand for the nutritional supplement.
When it comes to baby formula, cow's milk is still the primary option available to the market and soy-based formulas are the second. However, none of the formulas available have managed to solve the major and growing phenomena of sensitivities; intolerances or allergies. Euromonitor's 2018 market report data shows that 40% of the baby formula sales in the U.S. come from specialty formulas addressing these intolerance problems.
Moreover, according to a 2018 scientific study, 50% of food allergic U.S. babies under 1 year old are allergic to cow's milk. A further 50% of this population is also allergic to soy. This is causing many parents to seek out alternatives. Fortunately, Else Nutrition Holdings Inc. (BABY.V) is swooping in to disrupt this market and provide a much-needed 100% plant-based dairy-free and soy-free alternative.
The company's patented baby formula is 100% plant-based (made from 3 plants naturally providing 100% of the fat protein and carb content), has no external addition of macronutrients, or purified oils, with the cleanest label in its field. It is also free of antibiotics, gluten, hormones, and GMOs and has a minor ecological footprint.
Else's toddler formula is already market-ready and is expected to launch in Q2 2020 in both powder and liquid forms, while its infant formula is estimated to reach the market in the next two or three years.
These aren't Else Nutrition Holdings' (BABY.V) first plant-based products hitting the market however. The company has been selling its vegan baby snacks, bottles and accessories in Israel for quite some time, generating $900,000 last year, and is launching these products in the US early next year.
The company expects to generate roughly $350,000 from its baby snacks in the US market in 2020 before doubling that number the following year. Its toddler formula and kids nutritional drinks will also hit the shelves in the US next year.
And this is really just the tip of the iceberg for Else Nutrition Holdings (BABY.V). The company has strong IP protection and plenty of room for growth with global patents in over 19 countries including the United States, Australia, Japan, South Africa, Ukraine, and Eurasia. On top of that, Else also has an additional 50+ patents pending coming down the pipeline.
Get Used to it, Plant-Based Foods Are Here to Stay
Whether consumers are going full-blown vegan, becoming flexitarians, or sticking to their meaty diets, one thing is clear: plant-based foods are here to stay. It won't be surprising to see more companies like Hormel Foods Corporation, ConAgra Brands, Inc., and Tyson Foods Inc. launching their own meatless alternatives to this growing market.
We can also expect to see more and more plant-based dairy alternatives to hit the shelves in the coming months and years. Investors will also be watching out for other companies looking to join Else Nutrition Holdings (TSXV:BABY) in its mission to disrupt the 120-year-old infant formula industry.
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