Are plant protein crops an option?

Arable farmers are ideally placed to be key players amid growing international demand for plant-based protein.

WORDS & IMAGES SUPPLIED BY HEATHER CHALMERS, FOUNDATION FOR ARABLE RESEARCH

As consumers shift their protein buying preferences away from animal-based products such as meat and dairy, plant-based alternatives are becoming increasingly visible throughout supermarkets. This has led to the global pea and fava bean protein market growing rapidly, with overseas companies investing in extraction and ingredient manufacturing capabilities to capitalise on the growing popularity of this type of protein. Peas are already a mainstream crop in New Zealand and plantings could be expanded relatively easily, while fava beans are a crop option with growth potential. However, financial, infrastructure and marketing hurdles need to be overcome before a domestic protein extraction industry based on these crops could be established, a recent report has found. Off-Piste Provisions, a plant-based alternative meat company and FAR commissioned PwC to develop the pea and fava bean protein extraction viability case study and report. The report says that pea protein holds 10 per cent of the global plant protein market while fava bean protein is still emerging. Soy and wheat protein make up the majority of the market due to their historic use in Asian markets. Peas and fava beans are low-carbon, sustainable options and can be added to or expanded within existing crop systems in a number of arable regions of New Zealand . Currently the biggest proportion of peas grown in New Zealand are processed for freezing, earning $115m in exports in 2020. The main player in processed peas is Heinz Wattie’s, which grows and harvests the largest area of peas in the southern hemisphere. Since peas must be frozen within 60 minutes of picking, growing is concentrated in Canterbury and Hawke’s Bay where its processing plants are based. White peas are the main variety of pea used in the extraction of pea protein overseas but in New Zealand are typically sold as grain. Dried peas and fava beans are not high return crops for growers compared with other options such as carrot and ryegrass seed crops, wheat and maize. About 52,000 tonnes of dried peas were grown here in 2020, including marrowfat, blue and white peas as well as garden peas grown for seed, though annual volumes have dipped as low as 20,000 tonnes in the last decade. Growers attributed the variable volumes of dried peas to climate variability, crop rotations and changing contract prices.

Peas are a favoured rotation crop because they stay in the ground for a relatively short time (although dried peas need about a month longer than fresh or processed peas). As legumes, peas are nitrogen fixers, requiring little or no added nitrogen fertiliser. However, while the market may see potential to double the current area of dried peas and fava beans grown in New Zealand, neither crop provides high returns compared with other options such as carrot and ryegrass seed crops, wheat and maize. Not surprisingly, growers have indicated that they are likely to need comparable returns with other crop options to scale up production of peas and fava beans. Infrastructure is another issue. Pea and bean protein can be extracted cheaply and at scale overseas, making the building of an extraction facility in New Zealand expensive (even a small facility is estimated to cost $50 million) and risky for investors. To reduce the risk, the report explored three alternative investment structures: a wholly or partly government-funded facility, a grower collective or co-operative, or a hybrid plant ingredients facility. Off-Piste Provisions founder and chief executive Jade Gray says his company imports pea and fava bean powder from Canada for its products, by necessity, but would prefer to source from New Zealand ’s high-quality pea growing sector. His business has developed 15 products, the first of which are plant-based jerky snack products promoted as being 100 per cent plant and 45 per cent protein. Jade identifies two key ways to add value; investment in local processing infrastructure and the development of pea cultivars specially-bred to produce a premium performance during extrusion, the key production process used in manufacturing plant-based meats. “We need to get a value-add, otherwise there is no incentive for growers to expand pea production.” It had taken Southland 10 years to get the momentum and funding, including a $6m government loan, to build an oat milk plant in the region “and the window of opportunity for the pea sector is much smaller”. In terms of investment in an extraction facility, Jade believes a wider range of stakeholders are needed to de-risk it for growers. “The best model is a public-private one, with some government support to seed the investment and bring confidence to other investors. I believe there needs to be some investment from growers to show their commitment, with the private sector bringing the majority of capital after analysis of its profitability. A perfect partner would be one of the end-users of the process.” The next step now sits with growers, Jade says. “The report has enough information that growers can use it as a starting point to kick the conversation off in earnest. “We can take the opportunity and catch up with nations like the Netherlands, Israel, Singapore and the United States who are ahead of us in the alternative protein space, or we can kick the can down the road. But we may find that in another five to 10 years it is really starting to cut into our earnings. “If we pride ourselves on our export of proteins like seafood, meat and dairy, we should be getting involved in alternative proteins and the technology.” FAR General Manager Business Operations Ivan Lawrie says 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.” Other examples of New Zealand plant-based food manufacturers that have penetrated the global market, despite being more expensive than similar products made overseas, include Otis oat milk made from Southland oats and Pic’s peanut butter made from imported peanuts, although some peanut growing trials are underway in Northland. The value of the global pea protein market is expected to grow from $1.1 billion in 2020 to $2.1b by 2025. This represents significant growth opportunities for product manufacturers. According to New Zealand stakeholders there are some large global companies in the market but as the product is still identified as a new or novel ingredient, there is still the opportunity to improve the product; especially the taste and the versatility for use in more consumable products. While the use of fava beans as protein is less advanced, its high-profile appearance in products such as Beyond Chicken means it is likely to increase its share of the alternative proteins market. Fava beans have a slightly higher protein content than peas; fava beans are 26 per cent protein compared with 23 per cent for peas.