$3.1 billion was invested in alternative proteins — plant-based and cultivated meat — in 2020. However, we and other groups have called for additional government R&D funding. This support has raised a key question: why should the government invest in alternative protein research and development and support the industry if private firms and dollars are already driving the industry’s growth?record-breaking
This concern presents two important issues: would public investment produce any real benefit for the taxpayers who are ostensibly supporting the industry; and, with the billions of dollars pouring into alternative protein, would public investment do anything that private firms can not do themselves?
In a recent report, we argue that the social benefits of alternative proteins — reduced greenhouse gas emissions and local pollution, alternative protein job creation, and improved animal welfare, to name just a few — justify public investment in R&D to advance the industry. But, public funding should not be conceived as a gift to a socially beneficial industry, but rather a necessary step for the industry to quickly grow and succeed in providing the social benefits that proponents and advocates of alternative proteins promise.
Despite impressive sales and record-breaking venture capital funding, the young industry needs public support to jump over specific scientific and technological hurdles to meet its potential. Private investment in R&D can only do so much. Companies are more motivated to create commercializable products that maintain their competitive edge rather than investigating research questions and developing technological solutions that advance the sector and benefit the public as a whole. For the industry to be anything close to the climate and animal welfare solution that it holds itself up to be, it will require the kind of early-stage research and development that private firms have difficulty pursuing. Luckily, the U.S. federal government has proven itself to be an effective driver of early-stage R&D, resulting in massive cost reductions for technologies like photovoltaic cells, electric vehicles, and productivity growth in U.S. agriculture.
An exceptional amount of R&D is needed in order for alternatives to match slaughtered meat in taste and price. Alternative meat still makes up just 2% of the global meat market. Plant-based product prices are still at least 20% higher than their conventional meat counterparts, while cultivated meat has yet to reach commercial markets in the United States. According to the Good Food Institute, three of the top four barriers to consumer acceptance of plant-based meat are taste, price, and texture. And if the industry is expected to replace meat in general, it will have to find ways to produce alternatives to whole-cut products like steaks, fish filets, and chicken breasts or thighs, something that remains elusive.
For cultivated meat — meat grown from animal cells in laboratory or industrial settings — the production process is completely new, and large gaps in understanding some fundamental scientific questions remain. Although recent estimates suggest that ground-meat-like cultivated meat products could reach price-parity by 2030, cultivated meat remains at least 100 times more expensive to produce than conventional meat.
At the same time, it is likely that whole-cut products are likely to take far longer to come down in price. Early-stage research pertaining to the growth and behavior of chicken, cow, fish, and other animal cells would greatly advance the field past its origins in biomedical applications, which has had limited research aimed at producing food. Developing new manufacturing technologies for producing cultivated meat at scale is needed to drive down costs and realize a broader range of products.
Likewise, novel plant-based meats — meat imitations produced entirely from plants using technologies like high-moisture extrusion to create meat-like taste and texture — face scientific barriers related to developing new plant ingredients. Soy and wheat are the dominant crop sources, but many other protein-rich crops have yet to be studied. Research characterizing the nutritional and flavor traits of other crops would enable companies to create new, better-tasting, and more nutritious products. A federally-supported genomic mapping project aimed at sequencing and identifying different crops would help the industry in the long-run, while also potentially having secondary benefits like improved genetic and genomic understanding of common crop breeds.
The private sector lacks the incentive to tackle such high-risk, early-stage research that likely won’t lead to a commercial product in the short term. For example, it took 13 years to map the initial human genome and it cost around $300 million globally, of which the National Institutes of Health contributed 50-60%. While mapping crop genomes will cost less, it will likely be much more than what a single company could spend on long-term R&D. The well-capitalized Beyond Meat, for instance, spent about $30 million on R&D in 2020.
However, the federal government’s research capacity is perfectly suited to tackle fundamental scientific challenges. Numerous federal agencies, like the National Science Foundation and the Department of Agriculture, aim to advance scientific knowledge for the benefit of the public and have the infrastructure and financial resources to tackle the long-term scientific challenges facing alternative proteins and similar industries. Public sector R&D can utilize those resources, as well as the vast network of university researchers at land-grant and public universities, to fill the research gaps that private-sector researchers and investors are unwilling and unable to tackle.
This complementary role of public research can also attract private investment in R&D, effectively multiplying the positive impact of government investment. For example, Beyond Meat’s founder licensed plant-based meat production technology developed from USDA-funded research to start the company, which then attracted billions in private investment.
Letting private dollars be solely responsible for technological development also misses the opportunities that a public research agenda can provide to communities and institutions that may otherwise be excluded from the space. The alternative proteins industry has been criticized for its lack of diversity. In fact, female founders of alternative protein startups reported significant barriers in fundraising, due to prevalent biases related to gender and race, for example, in a survey. Federal dollars could be directed specifically at creating new research centers at minority-serving universities, like HBCUs and Tribal Colleges, to provide opportunities to innovators of color, and land-grant institutions in rural communities, to ensure that the benefits of alternative protein innovation are dispersed and captured more equitably, and not just held by Silicon Valley.
Federally funded research dramatically lowers barriers for scientists in the public and private sector to conduct research and accelerate technological development. Unlike its private counterpart, federally funded research can be open-access and makes knowledge and technologies publicly available. Open-access research benefits everyone, companies and academic researchers alike, and would prevent the siloing of intellectual property within specific companies.
Such non-proprietary technology and knowledge can help bring new competitors into the market and help drive both competition and further innovation based on the open-access findings. Although open-access research will also benefit incumbents to the industry, federal support to develop the alternative can build the alternative protein industry’s capacity to compete with conventional products in the long term.
Aiming the federal government’s massive research capabilities at fundamental scientific problems hindering the advancement of this industry will transform its future and that of the food system. For example, the government could create a centralized cell-line banking and maintenance facility, and a database that maps the genetic, functional, and sensory characteristics of plant ingredients. These research tools can all serve higher aims of making the food system better for the environment and workers, diversifying innovators, and dispersing the economic benefits of a new sector.
If the Biden administration is serious about improving our food system, they must not leave alternative meat solely in the hands of private money. Importantly, this is feasible in 2021. According to Congressman Ted Deutch, representing Florida’s 22nd district, “This research funding can happen this year through congressional appropriations and through targeted investment by the Biden Administration and the United States Department of Agriculture.”
Saloni Shah is a Food and Agriculture Analyst at Breakthrough. Previously, she completed her dual Bachelor’s and Master’s in environmental science and environmental analysis and policy with honors at Boston University. Find Saloni on Twitter @SaloniShah101
Alex Smith joined Breakthrough as a Food and Agriculture Analyst in 2019 after completing a dual MA/MSc in International and World History from Columbia University and the London School of Economics and Political Science. Follow him on Twitter @alexjmssmith
A version of this article was originally posted at the Breakthrough Institute and has been reposted here with permission. Read the full report, “The Case for Public Investment in Alternative Proteins” here. The Breakthrough Institute can be found on Twitter @TheBTI