By Tonya Garcia, MarketWatch
Conagra Brands Inc. says it sees an opportunity in the range of $30 billion from its recently acquired Gardein brand, which offers products in the growing plant-based meat category.
Conagra /zigman2/quotes/200394144/composite CAG -4.31% acquired Gardein alongside a host of other brands including Duncan Hines, Log Cabin and Birds Eye as part of the $10.9 billion Pinnacle Foods deal, completed in October. Gardein offers items like Meatless Meatballs and Meatless Chick’n Strips that are made from wheat, ancient grains and vegetables.
New items available this summer include breakfast bowls like the vegan Saus’age Benny Breakfast Bowl, a take on Eggs Benedict, skillet meals like Porkless Thai curry and Lambless vindaloo, and Chick’n Wings, Tenders and Nuggets.
Conagra Chief Executive Sean Connolly said the company looked at plant-based alternatives to meat as well as almond milk as an alternative to cow’s milk, finding that big business could await the company in this category.
‘”That means the opportunity here could be in the range of $30 billion just in the U.S.,” he said, according to a FactSet transcript. “And you know, there’s even more opportunity internationally.”
Shares of plant-based meat company Beyond Meat Inc. /zigman2/quotes/211617595/composite BYND +0.64% have soared since its trading debut in March, up 48% in the past month. Beyond Burgers, Impossible Burgers (owned by Impossible Foods ) and plant-based meat alternatives from a host of other companies are gaining favor as diners look for options that are better for their health and the environment.
Even traditional meat companies like Tyson Foods Inc. /zigman2/quotes/201117502/composite TSN -2.31% are going meat-free.
Though plant-based burgers have gotten a lot of attention, Conagra says chicken sales are growing fastest among consumers, up 26% year-over-year compared with 11% growth in beef and fish, and 9% growth in pork.
Altogether, Conagra says meat alternatives are an $800 million business, up 22% from a year ago.
“Our view is that the relative size of animal protein consumption serves as a useful guide for how to think about the market opportunity for plant-based alternatives,” Connolly said on the call.
“As you can see, burgers are important but this market extends well beyond beef patties or even beef.”
Conagra thinks Gardein is well-positioned with an established, diverse portfolio of products. The unit had $50 million of sales in plant-based chicken alternatives, $47 million in beef alternatives and $25 million in other products, including fish alternatives, in the 52 weeks ended April 21.
“Gardein’s current burger platform is underdeveloped and we’re in the process of creating the next generation of beefless burger to better compete in this popular segment,” Connelly said. “As we do this, we expect accelerated growth at retail and in food services. But we also plan to compete across the important hot dog and sausage categories.”