Dairy buoyant
The Rabobank Rural Confidence Survey found farmers' expectations for their own business operations had also improved, with the net reading on this measure lifting to +37% from +19% previously.
Sales have "hit a wall" and Fereday blames this on price and taste - two of the main factors that drive consumer purchasing habits.
Speaking to a group of leading farmers from 12 countries in Hamilton last week, Fereday says plant-based meat and milk have been at the forefront of farmers' minds since 2019.
Plant-based meat and dairy sales were growing, although they started from a small base. While plant-based dairy sales seem to be holding up in the US, plant-based meat sales have tanked.
Fereday says it comes down to taste and price.
"At the end of the day, they are asking consumers to pay more for a product that isn't as tasty as the product they are trying to replace," he says. "Usually, new products are sold at a discount, but they did the opposite for plant-based meat."
A recent survey by Rabobank NZ and KiwiHarvest shows that vegetarian numbers saw little change while vegans significantly decreased back to 2021 numbers.
Fereday notes that the US plant-based market had received a boost at the start of the Covid-19 pandemic when consumers were forced to seek out meat alternatives because of supply chain issues. The sector was boosted by double digits at the start of the pandemic. But the sector has failed to recover since the pandemic.
Fereday says major meat companies who had invested in plant-based meat companies were pulling back.
Meat titan JBS abandoned its plant-based business in the US just two years after entering the alternative meat market in that country. Canada's Maple Leaf Foods reduced its plant-based investment, citing slower sales.
He believes long term there is potential for plant-based meat, not as an alternative to meat but as a vegetarian option.
While plant-based meat is overpriced and under delivering in the US, plant-based milk consumption is growing. Fereday says it doesn't taste as good as milk but is attractive to the lactose intolerant who make up a sizeable part of the US population.
Best of the Best
Twenty-eight farmers from five continents and 12 different countries are spending 10 days in New Zealand taking part in the latest Rabobank Global Farmers Master Class (GFMC).
The bank describes it as a state-of-the-art agri learning programme established in 2012 to bring together leading farmers from around the world to address global food security.
The 2023 Rabobank GFMC kicked off in Hamilton last week and will finish in Queenstown on December 6.
The master class programme will feature presentations from top agricultural thinkers and business experts, interactive workshops and case studies, as well as visits to a range of flagship agribusiness operations in both the North and South Islands.
