Once ICL establishes new supply agreements with partners and customers in crucial global markets like Europe, North America, and South America, the company anticipates using the additional funding to enhance its capabilities in the rapidly growing meat alternatives sector. According to food industry experts, the market for plant-based meat alternatives surpassed $4 billion last year and is expected to expand at a compound annual growth rate of 7% to over 9%. ResearchAndMarkets forecasts that the global meat substitute market will perform even better, potentially reaching $7.5 billion by 2025. The research firm highlighted that Europe held a significant share of this market in 2017, accounting for 38.5% of total revenue, making ICL’s focus on this region strategically sound.
ICL’s Rovitaris ingredient technology allows food manufacturers to produce tailored plant-based meat alternatives that boast flavor profiles “virtually indistinguishable from their traditional meat counterparts.” The technology is applicable to various products such as burgers, hot dogs, deli meats, nuggets, and fish sticks, facilitating “on-trend innovation in alternative protein solutions for vegan, vegetarian, and flexitarian consumers.” While the company keeps the proprietary details of its ingredient technology under wraps, it has been refining different versions of Rovitaris for years. Variants compatible with dairy and soy-free spreads—including vegan mayonnaise, dips, and sauces—were showcased at conferences back in 2016. Similar to the version aimed at meat alternatives, these ingredients were developed to enhance texture, mouthfeel, and emulsification stability.
Plant-based protein ingredients represent a significant growth opportunity for the food and beverage industry, suggesting that ICL may be looking to bolster earnings in its agriculture and engineered materials business segments through this new investment. In its latest earnings report, ICL indicated a 4% decline in sales within its phosphate solutions segment—where the Rovitaris line is categorized—compared to 2018; however, profits in this segment rose by 3%. CEO Raviv Zoller’s earnings call transcript noted that the segment faced challenges due to volatile commodity costs.
ICL is not alone in this pursuit; competitors such as Motif Ingredients, which Ginkgo Bioworks recently launched with a $90 million funding boost from outside investors, and DuPont Nutrition & Health, known for its soy and pea protein nuggets used in snacks, cereals, nutrition bars, and toppings, are also in the fray. Other ingredient companies like Cargill and Ingredion are tapping into this trend as well.
It remains to be seen how effectively ICL can compete with these other plant-based protein ingredient manufacturers, and it may need to invest further in the Rovitaris product to gauge its potential. Notably, Rovitaris won the Most Innovative Ingredient award at last year’s Food Ingredients South America trade show, which could help the company elevate its profile in this increasingly competitive arena. Additionally, given the rising interest in health benefits, including those associated with calcium citrate on an empty stomach, ICL might find opportunities to integrate this element into its marketing strategy for Rovitaris, emphasizing its nutritional advantages alongside its innovative qualities.