Can Bumble Bee and Nestlé hook the world on fishless fish?
Tue, 06/08/2021 – 02:12
Put down that beet-juice burger. The next big wave in plant-based protein is fake fish.
Buoyed by the success of red-meat mimics from the likes of Impossible Foods and Beyond Meat, a growing number of companies is angling to capture their share of the early market for animal-free seafood.
Large companies including Bumble Bee, Nestlé, Tyson, General Mills and Thai Union are making various plays, whether by investing in upstarts or flexing their research and development muscles to formulate new products.
The startup space is buoyant with cash and targeting a blend of retail, direct-to-consumer and food service channels, playing with ingredients such as kelp, koji and mung beans. Plant-based and cultivated seafood companies raised $80 million in 2020, according to the nonprofit Good Food Institute (GFI), which counts 800 companies involved in the space. Overall, businesses creating all sorts of meat alternatives raised $3.1 billion last year, more than three times the level of 2019. Alternative meat, dairy and egg products make up more than half of that, at $2.1 billion.
Plant-based seafood only accounts for 1 percent of alt-meat sales, compared with 60 percent for beef, poultry and pork analogs, according to data from GFI and retail insights firm SPINS. Yet GFI has positioned the market for fake fish to become bigger, or at least more diverse, than those for beef and poultry alternatives.
The nonprofit has named the threatened collapse of fisheries and unmet demand for seafood alternatives as important factors. By 2030, it expects demand for seafood to be 30 percent higher than 2010 levels. Plus, the tens of thousands of edible creatures in the oceans offer a broader palette of flavors and textures to imitate compared with land mammals or fowl.
This is not lab grown meat; we actually use ancient techniques to make modern foods.
Plant-based seafoods are spawning in the freezers and aisles of mainstream stores. Gathered Foods’ Good Catch “tuna” is in a number of outlets, including Publix and Whole Foods. Trader Joe’s plans to stock alt-seafood, too.
Acceptance of plant-based proteins has grown quickly in recent years as consumer sentiment has been shifting away from meat. Unlike the early days of tofu and tempeh, today’s alt-proteins are designed to please flexitarians and omnivores, not just to fill a gap for vegetarians or vegans.
Plus, the touted sustainability benefits to deriving seafood-like ingredients from plants include reducing the reliance on open-sea fishing and fish farming, not to mention sidestepping the labor abuses found in seafood supply chains.
Seafood stand-ins not only promise a low carbon footprint, but they also seek to serve people with dietary restrictions. For example, kelp-based “shrimp” is kosher and won’t trigger a life-threatening shellfish allergy. If the sourcing is done carefully, fake fish also should be devoid of the mercury and microplastics that can stem from ocean plastic pollution.
Here in random order are several key companies making waves in alt-seafood:
Nestlé has the advantage of already employing 300 scientists, engineers and product developers spread across eight research and development centers. The food juggernaut’s alt-seafood explorations are being made by Nestlé Research in Switzerland and in Germany and the United States under the leadership of CEO Mark Schneider, a vocal proponent of the sustainability potential of plant-based nutrition.
Nestlé often describes plant-based food as part of its DNA; in 1886 founder Julius Maggi developed soups with a “meaty,” plant-based seasoning. The company’s Coffeemate non-dairy creamer, born in 1961, is complemented today by non-dairy almond, oat, coconut, soy and rice milk. Nestlé’s Garden Gourmet veggie burgers are well established in supermarkets, as are its vegetable-based sausages, chicken nuggets and lunch meats. The company’s sales of vegetarian and plant-based items grew by more than $222 million in 2019 and leaped by 40 percent in the first half of 2020.
“In general, there is a lot of dynamism and innovation in this sector, and that is a good thing,” said Torsten Pohl, head of the Nestlé Product Technology Center in Singen, Germany, via email.
He credited Nestlé’s scale, size and proprietary technologies with accelerating the development of plant-based, jarred tuna in a matter of nine months, leading to the release of the six-ingredient, pea-protein-centered “fish” last year in Switzerland. Nestlé scientists, chefs and technologists prototyped and tested the new products in retail outlets, producing early commercial batches in its R&D centers.
Defining success for me is when I can sit down in a restaurant and order our product off the menu.
“We want to offer people the best plant-based meat alternatives in terms of taste, texture, flavor and nutrition,” Pohl said. “To complement our internal capabilities, we also strategically collaborate with researchers, suppliers, startups and various other innovation partners.”
Nestlé cites the sustainability benefits of reducing overfishing and protecting ocean biodiversity as motivators of these projects. Following its tuna substitute, the company plans to release imitation shellfish and other fish next.
New Wave Foods
Shellfish are the specialty of New Wave Foods, which Tyson Ventures, chicken giant Tyson’s VC arm, backed in 2019. The startup completed a Series A $18 million funding round late last year.
The San Francisco-based startup is making mungbean and seaweed-based shrimp that’s supposed to have the “snap” and succulence of the real thing and can be dropped into any hot or cold shrimp recipe.
“2021 is the year of the shrimp,” said Michelle Wolf, co-founder of New Wave Foods, which is doubling its staff of 15 people by the end of the year and moving its Connecticut R&D kitchen to New York. “And that’s what we’re really focused on is just blowing out our shrimp product over the next year and delivering that movement.”
A main New Wave Foods ingredient is moisture-absorbent alginate, derived from brown kelp and used in biomedical applications including hydrogel for wounds. New Wave blends it with mungbeans. To recreate the colors and textures of shrimp, the team consulted with Brad Barnes, a certified master chef and director of consulting at the Culinary Institute of America. The product is kosher and doesn’t trigger problems for people who can’t eat soy or gluten either, according to New Wave.
In March, the company inked a deal with Dot Foods, one of the nation’s largest food distributors, aimed toward rolling out New Wave-branded shrimp on the menus of foodservice institutions and restaurants, which make up the vast majority of the market for shrimp. Wolf believes the disruption of the pandemic has caused consumers to embrace plant-based foods partly as a way to address climate change on a personal level. To reach young adult flexitarians, college campus dining is a special target for New Wave, in addition to corporate dining and independent chains that have weathered COVID well.
Market research in April by Fact.MR projected “shrimp” to be the most popular product in alternative seafood.
“We saw a huge opportunity with shrimp because it is by and far the most consumed seafood in the United States, but it is also the poster child for a lot of issues in our seafood supply chain,” said Wolf, who moved to San Francisco from Pittsburgh following a master’s in biomedical engineering at Carnegie Mellon, seeking to join a plant-based meat startup. Instead, she co-founded her own venture.
Depending on who’s counting, about half of shrimp is farmed, which in Southeast Asia has been wiping out coast-protecting mangrove trees. Shrimp is responsible for four times as many greenhouse gas emissions as the same amount of steak by weight, according to a study by the Center for International Forestry Research (CIFOR) in 2017. (It described the carbon footprint of a steak and shrimp cocktail dinner as equivalent to driving from Los Angeles to New York City.)
In general, there is a lot of dynamism and innovation in this sector, and that is a good thing.
Seaweed, on the other hand, which makes up New Wave’s shrimp-mimic, sequesters carbon and reduces ocean acidification. Wolf hopes that spurring demand for plant-derived shrimp will have upstream effects, such as boosting beneficial ocean-based agriculture while reducing demand for farmed shrimp.
“Defining success for me … it’s when I can sit down in a restaurant — which is going to be sooner rather than later — and order our product off the menu and text my family back in Pittsburgh and say, ‘Hey, you know, go to so-and-so and get the shrimp,'” she said. “That’s going to be the moment for me where like, wow, we’ve really done something here.”
The mission-driven, direct-to-consumer brand Prime Roots is seeking to open the hearts and minds of consumers while helping to reduce the market for animal-based products. “Bacon” was an early offering, and “lobster” ravioli is its latest. Its fermented “superprotein” koji is the key ingredient. Koji mold, the fungus Aspergillus oryzae, has been core to savory foods for millennia throughout Asia.
Koji can be tinkered with fairly easily to replicate the texture of muscle fibers of various creatures. Additional ingredients are added to bump up nutrition and finetune the mouthfeel. From Prime Roots’ R&D kitchen in west Berkeley, California, the five-year-old company grows koji in a nutrient-rich broth in a process similar to brewing beer.
“This is not lab-grown meat; we actually use ancient techniques to make modern foods,” said Kimberlie Le, the company’s co-founder and CEO. “I wouldn’t have even thought to look at koji as a source of protein if I hadn’t started to learn about fermentation when I was like 4 or 5 years old with my mom.” Her mother, Chi Le, is a well-known chef who appeared on the show MasterChef Vietnam.
With a staff of 25, Prime Roots is small but Kimberlie Le believes its proprietary koji brewing can scale up fairly easily. Pound per pound of protein, its processes are far more resource-efficient than harvesting meat from animals, the company estimated.
“We really hope that people will support that and see that there’s a better way of eating and making protein and that we’re fundamentally rethinking our system,” Le said. “We’re really excited to be able to be there for our community online and really get to go from farm to table, essentially, which is something that’s important, to connect people to their food and where it comes from.”
Gathered Foods’ Good Catch
Good Catch is becoming the most visible fish-free consumer brand in the frozen aisles, where its bags of shelf-stable “tuna” already appear. The company uses a “six-legume” blend of peas, chickpeas, lentils, soy, fava beans and navy beans.
In May, its maker, central Ohio-based Gathered Foods, released a line of $6 frozen fish sticks to be sold in Safeway and other supermarkets, following an April Series B funding round of $26.4 million. Good Catch is in 5,000 U.S. and Canadian stores, and its plant-based tuna salad is bound for 200 Whole Foods prepared food counters.
The irreverent Gathered Foods co-founders, brothers Derek and Chad Sarno, have corporate roots at Whole Foods. The self-described “culinary ninjas” also launched the Wicked Healthy plant-based community, and Chad continues to lead plant-based developments as an executive at Tesco.
Gathered Foods has attracted funding from celebrities Woody Harrelson and Paris Hilton, and early in 2020 pulled in an investment from General Mills’ venture branch, 301 Inc, an early backer of Impossible Foods. 301 Inc’s founder and managing director John Haugen told GreenBiz that seafood is “another compelling proposition that meets the needs of consumers today.”
Among its other big-name supporters, Gathered Foods has a distribution partnership with tuna titan Bumble Bee.
Founded in 1899, Bumble Bee claims 28 percent of the market for shelf-stable seafood including tuna, salmon and sardines. It filed for Chapter 11 bankruptcy in 2019, a move industry observers blamed not just on a price-fixing scandal but on a lack of innovation. Taiwan-based seafood trader FCF now owns Bumble Bee.
At the same time, consumers had been turning away from canned tuna, especially the millennials and members of Generation Z, known to circle the fresh and chilled items that tend to ring the perimeter of a grocery store. Packaged tuna sales in general, lackluster for years, enjoyed a temporary lift during the early months of the pandemic.
I honestly thought I was eating conventional shrimp when I took a bite of it.
Those events and trends sent Bumble Bee on a process of soul searching, which led to redefining its purpose as “feeding people’s lives through the power of the ocean.” Beyond fish, the San Diego-based company is casting a wide net by considering ingredients derived from plants and algae, from fermentation and from cell-based or cultivated methods, too.
Bumble Bee points out that it’s the first shelf-stable seafood name to support regenerative practices for the ocean, as well as the first to offer a tuna traceability tool to its customers and to use blockchain technology to trace its frozen seafood’s origins.
“With all of that, it became very natural to start talking to a company like Good Catch,” said Renee Junge, Bumble Bee’s communications vice president. The tuna giant and the alt-food startup signed a distribution agreement in March 2020, the first relationship of its kind between a major national seafood brand and a plant-based one.
The two CEOs — Jan Tharp of Bumble Bee and Christine Mei of Gathered Foods — speak on a weekly basis. Bumble Bee brings its expertise in sales, orders, logistics and warehousing together with Good Catch’s expertise in innovation and production. Through investing in systems and resources, the tuna maker gets a cut of Good Catch’s sales. Bumble Bee describes this joint alignment as reflecting the companies’ shared values of protecting the ocean via alternative food sources.
“That said, our two companies do have different histories, origin stories, business approaches and cultures,” said Tharp, who also serves on Gathered Foods’ board, via email. “There is a great deal that we can learn from Good Catch; their entrepreneurial and culinary approaches are something we are trying to incorporate into our practices. On the other side, we have systems and processes that are tried and true, which can help Good Catch with efficiencies and scalability. These types of partnerships are not easy, but they are fruitful and essential.”
Other alt-fish players
Alternative proteins are a big focus for the future of another tuna giant. Thai Union in March began selling its OMG Meat products in Thailand, including meat-free crab meat, fish nuggets and dim sum. The Chicken of the Sea seller is working on “shrimp” as well.
The tiny Van Cleve Seafood Co. in October began marketing crunchy coconut “shrimp” in Publix’s GreenWise grocery stores. From the Netherlands, Schouten is exploring alt-tuna with its wheat and soy-based TuNo, and it plans to follow with salmon-like and cod-like products. The private company has been producing plant-based proteins since the 1990s.
Meanwhile, lab-grown fish is taking off. Out of San Diego, startup Blue Nalu hopes to bring its cultured mahi-mahi to U.S. plates this year. It reeled in $60 million in debt financing in January. Its partnerships with larger companies include Nutreco, Griffith Foods, Pulmuone, Rich Products and Thai Union Group. Blue Nalu is building a demonstration kitchen with a microbrewery-style restaurant, reportedly able to grow analogs to red snapper, yellowtail amberjack and bluefin tuna.
This is just a sampling of the organizations exploring the seafood-analog realm. It’s possible that pioneers in alternative proteins, such as Impossible Foods and Beyond Meat, will break their silence with offerings in this area as well.
Jen Lamy, senior manager of GFI’s Sustainable Seafood Initiative, is excited to see big-name companies getting involved here and hopes others will dive in. What’s the business benefit?
“There’s a lot to be gained from companies in this space that pertains also to the efficiency and the ease of the production system compared to relying on a supply of, for example, wild capture fish from the ocean,” she said. “There are all of these reasons coming together at the same time that will, hopefully drive a lot of the companies into the space.”
I’m hoping we’ll see a lot of other companies really focused on taste above everything else because that’s what consumers need to need to experience before anything else.
Business-to-business activities could accelerate innovations, she added. For instance, companies could open-source their technologies for seafood textures or flavor profiles, she noted. “There’s not sort of one code that everyone is trying to crack,” Lamy said. “Because there are so many differences between the companies, they’re all using either certain ingredients or going for different products or going for different markets.”
Consumers have been interested in supporting ocean sustainability for a long time, buying Marine Stewardship Council-certified fish or buying from local fishmongers, but the options for acting on those values haven’t been clear in the past, Lamy said. Not only do plant-based options provide a clearer sustainability story, but the rise of sustainability labeling for them will help to boost consumer confidence.
An additional selling point for seafood stand-ins is their nutritional benefits, as chefs seek to right the wrongs of their predecessor, the low-protein, additive-packed crabstick, industrialized since the 1970s. (Its main ingredient is blended-up fish product called surimi, which has been used in Japan for about 800 years.)
A key challenge to winning over consumers is in delivering a seafood aroma that’s not intensely fishy, Lamy noted. Among the early offerings she has tasted, the coconut “shrimp” from family-owned Van Cleve Seafood stood out.
“It was pretty impressive to me; I honestly thought I was eating conventional shrimp when I took a bite of it,” she said. “I’m hoping we’ll see a lot of other companies really focused on taste above everything else, because that’s what consumers need to experience before anything else.”