What Does The Future Hold For Egg Alternatives? - Alt-Egg Exploration #7
Summarizing the opportunities and the challenges for chicken-free eggs in Japan and abroad.
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Happy Tuesday Market Shakers. Today’s post gives you an executive summary of the global market for alt-eggs, with a focus on Japan. We combined two months of market research and 6 newsletters on the topic into one digestible article. Let’s get cracking!
Today’s post also includes exclusive commentary from Japan’s leading plant-based egg startup, UMAMI UNITED.
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The vegan egg market has grown a whopping 200% over the past two years. Nourished by a boom in demand for animal product alternatives, estimates project that the market for plant-based eggs alone will be worth $11.9 billion by 2029.
A recent wave of avian flu has hit the global egg supply chain hard. Stores shelves and restaurant menus across the world are increasingly eggless. There has never been a greater need for alternatives to conventional chicken eggs.
Eggs are one of the most widely used and versatile ingredients in the world. This makes creating an all-purpose alternative a true challenge. But, there’s a growing number of companies willing to take it on. Most are focussing on one specific “type” of egg offering, like “fried” or “liquid scramble” types.
Startups and big-food companies are racing to hatch alternative egg products. To date, players have focussed on plants as a core ingredient.
🧐 What Is Driving Demand For Egg Alternatives?
Eggs are one of the most consumed foods on the planet. Global per capita consumption is 161 eggs per year, but high-consuming countries like Japan, China and Mexico, consume well over 300 eggs per person, per year.
And that’s for good reason. Not only are eggs affordable, but they are also packed with protein and other essential vitamins (A, D and B12) and nutrients such as Choline, which is essential for metabolism and can also help protect against Alzheimer’s disease.
But, there’s also several reasons why eggs aren’t all they’re cracked up to be.
90% of the world’s chickens are battery farmed in unethical conditions.
Avian-flu cases are rising, double bad news for a world suffering a COVID-19 hangover - which is believed to be animal-born.
Egg allergies are also a daily struggle for many. In Japan, eggs are a top food allergen among children.
In short, there’s a growing demand for ethically produced, healthy eggs. And for many, that means eggs made without involving any chickens at all.
📈 What Is The Global Market For Egg Alternatives?
In 2022, the global market for egg alternatives is valued at USD 1.5 billion.
The US is the market leader for egg alternatives. In 2021 national sales reached a modest USD 39 million. However, this represents 1000% growth from 2018, showing demand and the number of available products is on the rise.
Asia is the largest consumer of regular eggs, and if alternatives can take even a fraction of the share of the market, it’s a big opportunity. Demand for such products is not high, however. Several local startups, like Float Foods, are working to develop a market, but US giant JUST Egg has had the most success by entering several local markets, including China and South Korea.
The Japanese market only hatched in 2022 so it’s early days. Following the trend set by plant-based meat, big food players dominate this space, including Kewpie and Kagome (through a collaboration with 2Foods). Health concerns, namely food allergies, avian flu, and high cholesterol will be a major driver of the nation’s appetite for alt-eggs as it evolves over the next decade.
⛹️♀️Who Are The Key Companies In Each Region?
JUST Egg 🇺🇸 Founded: 2013 - JUST Egg is the company driving most of the alt-egg market. They’ve sold the equivalent of over 100 million eggs to date and are expanding globally across APAC and Europe.
Grupo Mantiqueira 🇧🇷 | Founded: 1999 - In 2019 Brazil’s largest egg producer Grupo Mantiqueira launched a plant-based egg product. The product is a powdered type plant-based egg, packaged in single-serving sachets and sold in egg cartons like regular eggs.
CrackD 🇬🇧 | Founded: 2020 - The liquid egg replacer is sold in UK supermarkets. It is made from cold-pressed pea protein and can be used to cook various egg dishes including scrambled eggs, quiche, and Yorkshire puddings.
MIDDLE EAST AND AFRICA
Yo! Egg 🇮🇱 | Founded: 2019 - Yo! Egg make plant-based fried and poached eggs. They use soy and pumpkin as base ingredients. In 2022 the company raised $5 million to support its expansion to the US.
AUSTRALIA AND NEW ZEALAND
Orgran 🇦🇺 | Founded: 1984 - Allergy friendly food manufacturer Orgran launched a vegan egg made from chickpea flour in 2020. The company aims to support people leading a “free-from” lifestyle.
Float Foods 🇸🇬 | Founded: 2020 - Float foods received nearly USD 2 million in funding to commercialize their plant-based egg product which is actually two products, a yolk and a white. The company claims its product achieves a “comparable degree of likeness” to a real chicken egg.
Kewpie | Founded: 1919 - Mayonnaise giant Kewpie released Hobotama, a range of liquid-type and scrambled plant-based eggs in 2021 targeting the egg allergy and vegan markets. They seek to grow their plant-based product business to JPY 500 million in sales by 2025.
2Foods | Founded: 2015 - 2Foods partnered with food giant Kagome to create Ever Egg, a plant-based scrambled egg omelet. The product targets a growing number of flexitarians in Japan who want to enjoy the national-favorite dish, omuraisu (Egg omelet on top of seasoned rice).
UMAMI UNITED | Founded: 2022 - UMAMI UNITED launched UMAMI EGG in 2022. The product is powdered and made from konjac. The company mainly sells B2B.
🛒 What Are The Key Products, Trends, And Prices In Japan?
At present, the majority of Japan’s alt-egg offerings are sold to food services, for egg-free menus, as well as to manufacturers seeking to make vegan and nonallergenic products. Consumers can also purchase products online, like Kewpie’s Hobotama product which is sold through Amazon Fresh.
Hobotama | Kewpie
Liquid-type plant-based egg (for omelets, custards, etc)| 60g | 182 JPY
Scrambled type Plant-Based Egg | 60g | 214 JPY
Food Service Product | 20 x 120g packs | 4600 JPY
Ever Egg | 2Foods in partnership with Kagome
Multi-pack of 5 / 10 / 15 servings (online) | 2400 ~ 6750 JPY
In-store single serving pack | 390 JPY
Restaurant menu item | 1210 JPY
UMAMI EGG | UMAMI UNITED
Multiserving bag | 500g |12,000 JPY
Single serving bag | 25g | 1500 JPY
Pudding mix | 1kg bag | 6840 JPY
NEXT EGG by NEXT MEATS and the Plant-based hard-boiled egg by Green Culture is still in development and not available to buy.
💼 Case Study #1 - UMAMI UNITED
UMAMI UNITED produces a powdered egg alternative from konjac root, UMAMI EGG, as well as a plant-based egg-custard pudding mix.
The company sells its product online via its website and B2B as an ingredient for companies who want to make egg-free offerings.
UMAMI UNITED aims to unite vegan and non-vegan consumers around a tasty alternative egg packed with the essence of deliciousness, umami.
There is demand in Japan for egg alternatives because eggs are the most common allergy. According to Hiroto Yamazaki, “10% of Japan’s population have allergies, and eggs are the most common cause, especially amongst children.”
To date, UMAMI UNITED is exploring opportunities with businesses such as baby-food makers and producers of baked goods that want to make allergen-free products.
According to Hiroto,
Japanese consumers are behind western markets in adopting plant-based products. We’ve struggled in our outreach to general consumers so far.
The first step is to target businesses and consumers who have a real need for alt-eggs, like those with allergies. After that we need to focus on raising awareness and leveraging plant-based products' health benefits.
🎤 Case Study #2 - Hegg
Hegg is a plant-based powdered egg product sold in Singapore to food services and directly to consumers.
Hegg is made from canola which is protein rich and has a mild taste, giving Hegg a balanced flavor. The product contains 50% less calories and 93% less fat than chicken eggs.
Hegg is versatile and can be used to make scrambled eggs, omelets as well as baked products such as canelés and choux puffs.
Hegg helps to reduce food loss as it can keep for one year at ambient temperature, unlike regular eggs which expire soon, often before consumers can eat them. Singapore also creates over 30,000 kg of eggshell waste per day which Hegg seeks to reduce with their offering.
Hegg developed a balanced and versatile product so they can create localized offerings as they expand globally.
Earlier this year the company partnered with Singaporean heritage brand Killiney Kopitiam to release an “Eggless Kaya” - a local jam usually made with egg.
According to Hegg’s CEO and co-founder, Yau Png Ow:
We can’t copy and paste what works in Singapore and expect it to wow globally, however. When it comes to Japan, for example, we’re experimenting with Hegg in chawanmushi (a steamed savoury egg custard dish).
If we can produce authentic local dishes with our product, we can prove to the market that the Hegg Eggless Egg is a quality egg alternative.
🛍 What Are Japanese Consumers Saying?
Our consumer interviewers revealed that Japanese customers want healthy and versatile alt-egg products.
Hideki | Male | 60s | Retired
I haven’t heard of or tried plant-based eggs. But I’d like to try them because they’re new to me. My cholesterol is high so I try to eat foods that are low in fat. Knowing that plant-based eggs have such benefits, I’d like to eat them.
Emi | Female | 40s | Hairdesser
I’ve heard that the conditions in which chickens are kept in Japan is not healthy for them….I don’t like animal cruelty, so plant-based eggs appeal to me for that reason. It’s important to me that products are healthy though. They should be similar to regular eggs if they’re supposed to be a replacement.
Kenta | Male | 30s | Consultant
I’d consider eating plant-based eggs for breakfast. I want to eat them as a fried egg, scrambled, or as an omelette. I like cooking and often use eggs to make pasta dishes. I wouldn’t want to substitute regular eggs for my pasta in case it messed with the taste. I wouldn’t want to pay more for plant-based eggs than regular eggs.
Yuha | Female | 20s | Ecommerce owner
I’ve been vegan since I was young and I have an egg and dairy allergy so I’ve never tried a lot of animal products. When I try alternative proteins, including eggs, my main motivation is to experience products that are close to the real thing so that I can know what they taste like. I’m not really motivated by nutrition.
Of all the products I’ve tried, JUST EGG is one I want to eat again. It was very easy to make and it had a great flavour. I’ve also always wanted to try dashi-yaki tamago (Japanese rolled egg omelette) and I could make it with JUST Egg.
💰 What Are The Market Opportunities And Gaps In Japan?
Versatility: consumers in Japan and abroad demand versatile egg alternatives. That’s products that poach, scramble, fry, roll, and perform like real eggs. The flexible applications of JUST Egg is one reason that the liquid egg has been able to wow consumers so far.
Health: Hiroto Yamazaki predicts that “concern in Japan about allergies and chicken flu will only further demands for alternative eggs...so the market is going to grow rapidly”. The lesson to learn here? Alt-egg products can create demand by communicating about health benefits to Japanese consumers.
Localized products: the world enjoys eggs in different ways. From tamagoyaki in Japan to Scotch Eggs in the UK, there are opportunities for alt-eggs in local dishes. Over the last few years, the number of alt egg products targeting different types of eggs has exploded. Launching products that meet local preferences will grow the number of consumers willing to try egg alternatives.
Bakeries: Consumers aren’t bothered about where the eggs in their baked products come from, they want them to taste great. And there is growing demand from baked goods companies for nonallergenic egg substitutes.
✋ What Are The Barriers In Japan and How To Overcome Them?
Versatility...again: It’s hard to make a versatile, minimally processed egg substitute using plants. But that’s what consumers want. Companies should plan to offer several different types of egg products. Or, try to create powdered or liquid products that have several applications.
Raising consumer awareness: In Japan especially, the demand for alternative protein is nascent. For eggs, it’s still limited to vegan consumers and those with allergies. More work to raise consumer awareness will be key. Like plant-based meat, collaborations with national food service chains like Starbucks is one way to do this.
Our consumer interviews showed there was interest amongst consumers in trying egg alternatives.
The global market is expected to reach a value of USD 3.3 billion by 2031, rising at a CAGR of around 8.3%, according to recent reports.
A recent downturn in the market for plant-based proteins is a barrier. It's making it harder for startups to find investors. This means the impressive growth seen by the alt-egg market over the last few years will likely slow globally.
The silver lining is that existing players in the alt-egg space are now forced to focus on quality products that better deliver on what consumers want: versatile, minimally processed products. The more existing products can better meet consumers’ needs, the more the demand for egg alternatives will grow.
In Japan, however, there’s little appetite to invest in alt-eggs according to the founder of UMAMI UNITED, Hiroto Yamazaki:
It’s getting more challenging to get investment and to find partners in Japan. We're facing an economic slump, and plant-based is a new concept for the Japanese market so it’s taking time to educate the market.
The market for egg alternatives is small but young. The general Japanese consumer does not yet crave egg substitutes or even know they exist. Nor are they especially driven by animal welfare concerns.
Will we ever see supermarket shelves in Japan bursting with egg alternatives then? Yes, but for now opportunities lie in commercial products.
Currently, opportunities are concentrated in products for people with allergies and vegans/ flexitarians. Baby food companies, canteens, and baking companies are also markets where there is demand for non-allergenic, chicken-free eggs.
Avian flu has brought sweeping egg shortages in 2023, and this is stirring demand for alternatives across the F&B industry.
To reach a bigger market, players in Japan need to first and foremost raise awareness amongst consumers about egg substitutes and their benefits in terms of health and sustainability.
As tourism returns to Japan, food services are increasingly interested in offering vegan menus presenting an opportunity for alt-egg producers. Hotels may want to offer a vegan-egg option at the breakfast buffet for example.
That’s all folks
Thank you for staying with us as we explored the market for egg alternatives globally and in Japan.
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Thanks for sharing this wonderful article on plant based eggs around the world. I would like to add that one of the biggest barrier of entry for Eggs is Nature. Shelled Eggs are very versatile and are able to do pretty much everything and anything in the kitchen.
The development in plant based eggs is still very nascent, with many products rather lacking in taste, performance and function. Cost is another challenge which is becoming increasingly difficult due to cold chain.
Looking forward to reading more articles on other alternative proteins.