Blog: Plant-Based Meat Prices are Falling. What Does That Mean for Beef and Emissions?

As prices fall for plant-based meats like the Beyond and Impossible Burger, many expect them to replace a large portion of conventional meat consumption and production. Kearney, a management consulting firm, projects that plant-based meats will account for 10% of the meat market as early as 2025. Plant-based meat boosters have claimed that the rise of plant-based meats will create a “death spiral” in the livestock industry and eventually “eliminate animal agriculture.” Much of the livestock industry fears this type of disruption; the National Cattlemen’s Beef Association has made regulating “fake meat” one of its top policy priorities.

However, a new analysis co-authored with agricultural economists Jayson Lusk and Glynn Tonsor finds that moderate declines in the price of plant-based beef will have only small impacts on the cattle industry as well as on the number of cattle slaughtered and on meat’s environmental footprint.

Read the entire pre-print on SSRN here.

With a 10% reduction in price for plant-based beef, similar to what we might expect over the next year based on recent trends, we estimate:

• Plant-based beef consumption would increase by 23%;
• US cattle production would fall by only 0.15% or by about 49,000 head of cattle;
• International cattle production would fall by about 34,000 head of cattle heads;
• US cattle producer economic welfare, or the prosperity of all cattle producers in the US, would fall by about $300 million, which is equivalent to 0.6% of average cattle revenue in recent years; and
• US consumer welfare, or the benefits to all US consumers, would increase by about $513 million, which is equivalent to 0.45% of average expenditures on beef in recent years.

As a result, we project that net greenhouse gas emissions from cattle production would fall by 3.8 Tg CO2e per year globally, equivalent to 1.4% of total U.S beef emissions. This includes changes in emissions and carbon sequestration due to changes in land use. Given the small land footprint of alternative beef production, replacing some cattle production with that of plant-based meat would reduce deforestation and other land-use change internationally and free up land previously used for cattle production domestically. This land could be restored and reforested over time and sequester carbon.

Price declines in plant-based meats could have small effects for many reasons. Research indicates that consumers only partially substitute plant-based meat for conventional meat when prices decline. Plant-based meat consumption is still low overall, and even rapid growth in consumption would have a small effect on conventional production. Most meat substitutes in the US only exist for ground beef, so if demand falls for ground beef, producers can still sell more non-ground beef like whole-cuts domestically and also increase exports. Cattle producers also can’t quickly shift production to respond to market changes, so the impact on cattle production may be small until producers adapt. In the long run, we expect the impact of plant-based meat price declines to be larger, but not by much more.

Subsequently, these economic and environmental changes are pretty small. To capture more consumer demand in the future and have greater environmental benefits, the taste and texture of alternative meats must continue to improve and new types of products, such as substitutes for whole cuts of meat, must be developed. But improving the environmental sustainability of meat cannot solely rely on alternative meat—efforts and technologies to reduce greenhouse gas emissions, water and air pollution, land-use change, and other impacts from livestock production are also needed.