A recent report undertaken by PwC to understand the current market situation and opportunities that exist for pea and fava bean protein extraction in New Zealand suggests that a sizeable opportunity may be ripe for the plucking for investors and the local agri-food and ingredients sectors.

The report, entitled "Feasibility of Pea and Fava Bean Protein Extraction in New Zealand”, was commissioned by Off-Piste Provisions, a Kiwi plant-based meat alternative company, and was funded by the Ministry for Primary Industries (MPI) and the Foundation for Arable Research (FAR). It sought to provide the agri-food and ingredients sectors with greater clarity around the realities, costs, barriers and opportunities for growing and processing plant-based protein crops, as well as examining its potential as an alternative export opportunity.

Off-Piste Provisions’ founder, Jade Gray, notes that the global plant-based protein market continues to grow at pace, with one recent report predicting a compound annual growth rate (CAGR) of 14.1 percent over the next five years to reach an estimated US$40.58 billion by 2027 as it edges into the US$1.5+ trillion conventional protein market.

“There are strong market signals that an increase in the global production of pea and fava bean protein is on the horizon,” Gray confirms. “By necessity, Off-Piste Provisions currently imports its plant protein, but a high quality, New Zealand-grown and processed product would be our preference.”

The PwC report reveals two key factors will determine New Zealand’s success in unlocking its plant-based protein potential, the first of which is investment in the construction of a local extraction facility.

“One option could be through a public-private partnership, such as the one undertaken by Southland Regional Development Agency (Great South) to develop a carbon-neutral, plant-based beverage factory in Makarewa,” Gray points out. “That’s a $60 million investment in the future of plant-based food in New Zealand, and it could be just the beginning, given New Zealand’s abundant natural resources and ideal growing conditions.”

Establishing and operating an extraction facility in New Zealand is only one half of the equation; Gray believes the level of investment that would be required for such an operation to succeed would demand the unlocking of a premium value to boost its commodity rate.

“New Zealand’s primary producers have long been able to charge a premium in global markets for the clean, green reputation we enjoy, but it’s more difficult to trade off that reputation when it comes to ingredients,” he explains.

He believes the potential to add value may lie with New Zealand’s proven record in genetic improvement, as seen with the successful introduction of gold and red kiwifruit by Zespri: “a huge value add would come through breeding crop cultivars that are optimised exclusively for extrusion (the key production process used in manufacturing plant-based meats)."

According to Ivan Lawrie, General Manager Business Operations at the Foundation for Arable Research (FAR), Kiwi farmers already have a serious interest in being involved beyond the farm gate and participating in the value chain of plant protein-based products.

“Providing profitable and sustainable crop options for New Zealand arable farms is key to maintaining diversity in our cropping systems. In particular, pulses such as peas and beans play an important role in a healthy rotation."

Although PwC’s report identifies that there is significant potential for New Zealand to capitalise on the rising plant-based protein market both locally and on the global stage, it concedes that further investigation would be prudent before investment decisions are made.

“Establishing an extraction facility in New Zealand would involve large costs and associated risks for would-be investors,” notes PwC’s Sustainability and Climate Change Director Victoria Hatton. “Although New Zealand is well-positioned to scale up some aspects of the value chain, including growing and some aspects of go-to-market, more work is necessary to understand the costs and market conditions.”

"This report represents a significant step forward in answering the long-contested question as to whether or not New Zealand has an opportunity to compete in the rapidly growing global alternative meat sector,” Gray concludes. “It is my hope that the arable crop growers will use the important findings as a springboard to engage with other stakeholders in driving forward this exciting value add opportunity for the sector."

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