The announcement that Meatly has received UK approval for its cell-based chicken to be used for pet food purposes is a welcome piece of good news for an industry that has felt beleaguered of late.
Claiming a double first – the approval of cell-based meat in Europe and the approval of cell-based meat for pet food anywhere in the world – London-based Meatly, which is only two years old, says it has “secured brand partnerships and production of its products with leading pet food brands”. It plans to launch the first samples of commercially available pet-food this year and start scaling production to reach “industrial volumes” in the next three years.
Boxes ticked
The time it takes to get product to market has been one of the issues the cultivated-meat industry has faced, arguably an even greater hurdle than gaining regulatory approval (until today achieved only in the US, Singapore and Israel).
Investors rushed to back the food-tech businesses at the cutting edge of producing meat in a lab from animal cells using fermenters without hurting animals.
The boxes ticked in terms of the potential to help tackle some of the world’s, ahem, meatiest problems – such as intensive animal agriculture and food security issues – were too tempting to resist. But the decision to back such businesses wasn’t solely altruistic; these were seen as the future, potentially the food-tech versions of Microsoft and Apple.
In 2022, a staggering $922.3m was invested in cell-based protein businesses (cultivated seafood as well as meat), according to advocacy group The Good Food Institute (GFI).
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By GlobalData
But in 2023 that figure – again from GFI – had fallen alarmingly to $225.9m.
As GFI pointed out, this “mirrors the broader tepid private funding environment” but there were other issues.
Barriers
Chief among the obstacles has been the cost of production and specifically of the medium, usually fetal bovine serum, needed to grow the animal cells.
This has been seen as one of the barriers to bringing products to market on a meaningful scale. Meatly says it has developed a low-cost, protein-free medium which significantly reduces production costs.
A broader, if linked, concern was the rate of progress. Cultivated-meat businesses always seemed to be on the verge of a breakthrough that would see their product entering the foodservice channel and there were hints of a retail presence further down the line.
But there seemed to be a ‘jam tomorrow’ aspect to these claims and while sensible investors always saw this as a long-term play it felt like their patience was being tried.
Approval in the US for cultivated chicken from Upside Foods and Good Meat in the summer of 2022 seemed to suggest a staging post had been passed and presage a bright future. Good Meat described it as a “watershed moment for the burgeoning cultivated-meat, poultry and seafood sector, and for the global food industry” and there was talk of commercial-scale production.
Job cuts
But two years down the line all that has been achieved is working with the odd innovative chef to get cultivated meat on the taster menus of a couple of (extremely) high-end restaurants.
And worse was to follow. Upside Foods, after cancelling plans for a laarge-scale production unit, recently announced it is cutting an unspecified number of jobs.
It said it was “focused on our next chapter of scale and commercialisation” and had taken the decision “to stay agile in the face of an uncertain macro-environment”.
Meanwhile, its US peer Good Meat paused both the sale of cultured chicken to Hubers Bistro diners in the country and its production of cultivated meat in Singapore.
In a December 2023 interview with Just Food, Good Meat founder Josh Tetrick admitted scaling up production of lab-grown meat is a “massive challenge”.
But could a potential new customer base in the shape of the pet food market, be a way of putting some of the industry’s troubles behind it?
Positive reaction
Speaking to Just Food earlier this year, Nick Cooney, managing partner of Lever VC, a New York- and Hong Kong-based investment firm that was one of the first to tout the potential of cultivated-meat businesses, said he had come around to thinking the pet-food industry as client idea could have legs.
Cooney cautioned, however, that, even so, “it will take a while for cultivated-meat to get to a price point where pet food can work, even within the premium segment”.
But he pointed out ongoing premiumisation in the sector is an important factor and added that “cats and dogs are less discerning customers as long as it tastes good”.
He also made the point that there is a good story to tell for pet owners concerned about sustainability.
And in terms of regulation – despite the fact today’s green light for Meatly is the first approval for pet food use – the process should be speedier if humans aren’t the target market.
The GFI, which has skin in the game as an organisation working to accelerate plant-based, cultivated and fermentation-derived protein products, clearly sees today’s announcement as significant.
Linus Pardoe, its UK policy manager, said: “The UK is a world leader in developing cultivated meat and the approval of a cultivated pet food is an important milestone. It underscores the potential for new innovation to help reduce the negative impacts of intensive animal agriculture.”
And Meatly investor Jim Mellon, founder of Agronomics, added: “Through its technological innovation and close work with governing authorities, Meatly is helping prove that we can succeed in commercialising cultivated products for pets across the UK.”
Whether this is wishful thinking or not remains to be seen because, as significant as today’s announcement may sound, fundamental questions around cultivated meat remain unanswered.
Can it be produced at the scale and at the price that the food/pet food industry requires without a huge uptick in the amount of investment going into the industry? Will the end consumer, pet owner or not, buy into what is being offered?
All eyes will be on Meatly to determine whether its, admittedly impressive, momentum can be maintained or whether it will hit yet another, perhaps as yet unmentioned, barrier to growth.
