Growing health concerns fuel consumer demand for plant-based dairy, meat, eggs, and seafood alternatives. The alternative protein market in Thailand is booming as manufacturers have addressed various consumer needs through product innovation.
Spurred by the entry of more multinational companies and startups into the space, the dairy alternatives and meat substitutes market in Thailand will expand by a value compound annual growth rate (CAGR) of 3.5 percent between 2022 and 2027, according to GlobalData, a leading data and analytics company.
Bobby Verghese, Consumer Analyst at GlobalData, stated that the pandemic elevated public awareness about the health risks due to lifestyle-related disorders, such as obesity and cardiovascular diseases. As a result, more consumers have minimised their consumption of animal-derived proteins to manage their blood cholesterol or body weight. Innovations, such as plant-based meat, have supported these consumers in transitioning to low to no-animal-protein diets."
Key Account Director at GlobalData Singapore, Tim Hill, commented that while vegans and vegetarians are the target market for alternative proteins, these demographics comprise only a small percentage of the Thai population.
"For instance, only three percent of Thai respondents claimed to be vegans and vegetarians in GlobalData's 2023 consumer survey," said Hill.
Comparatively, 25 percent of Thai consumers in the same survey have adopted a flexitarian, pescetarian, or low-meat diet. Therefore, alternative protein manufacturers have broadened their target market to include consumers looking to reduce their animal protein intake.
Verghese added that the difference in sensory properties, nutritional value, and price compared to animal-derived proteins are critical barriers to mass-retail consumer acceptance of alternative proteins.
To manage this, manufacturers strive to improve alternative proteins' organoleptic properties by using a more comprehensive range of ingredients, novel technologies, and processes.
Examples include fortifying plant-based alternatives with proteins, fibre, calcium, omega-3 fatty acids, and B vitamins to increase shelf space and make products more appealing for health-conscious shoppers. Furthermore, manufacturers are also securing environmental and ethical certifications from reputed organisations to attract eco-conscious Thai youth.
The other critical challenges for the alternative protein sector are limited product range and availability. However, with more multinational and regional companies venturing into the space, many products are going to retail outlets, ranging from supermarkets to mom-and-pop stores. Beyond entry-level products, such as plant-based burger patties, sausages, and meatballs, manufacturers are developing alternative protein products customised for Thai palates and versatile for Thai dishes and culinary practices. Manufacturers and producers are also unveiling sophisticated product formats, such as ground beef, chicken breast, bacon strips, crab cakes, fish sticks, shrimp dumplings, and ready-to-eat meals.
"The presence of allergens is marring the healthy halo of soy, wheat, and nut-based alternative proteins, which presently dominate the Thai market. Major food companies and startups are exploring other protein sources such as mushrooms, algae, seaweed, and legumes to circumvent this," said Verghese.
Dairy and meat substitutes made with green peas, fava beans, chickpeas, and lupin beans are rapidly gaining appeal in the Thai market. However, the high price differential of alternative proteins will impact the segment's short-term growth amid spiralling inflation.
In the coming years, companies are expected to roll out more hybrid products blending animal-derived and alternative proteins to tap the best of both worlds and overcome consumer resistance.
