The alternative meat category is one of the fastest growing categories in the food industry and Tyson Foods is throwing its hat into the ring.
The company announced a new brand called Raised & Rooted on Thursday (June 13), coming to retail and foodservice in the coming weeks.
Tyson Foods said the new brand was created to provide great-tasting, plant-based and blended foods that are rooted in how people eat today. The initial products include plant-based nuggets as well as blended burgers made with a combination of beef and plants. The products will be available to the Northwest Arkansas and Chicago markets this fall and will be sold through major retailers, including Walmart. In addition, the company’s existing Aidells brand has launched Aidells Whole Blends sausage and meatballs, made with chicken and plant-based ingredients.
“Today’s consumers are seeking more protein options so we’re creating new products for the growing number of people open to flexible diets that include both meat and plant-based protein,” Tyson Foods President and CEO Noel White said in a statement. “For us, this is about ‘and’ — not ‘or.’ We remain firmly committed to our growing traditional meat business and expect to be a market leader in alternative protein, which is experiencing double-digit growth and could someday be a billion dollar business for our company.”
White said major retail and foodservice customers have expressed interest in what Tyson Foods could bring in the growing alternative protein segment. White has said previously the company is using the depth and breadth of its experience in protein development, manufacturing, distribution and marketing to bring plant-based proteins to market.
He told Talk Business & Politics during the recent earnings call with media that consumers want choices and it makes sense for Tyson Foods to enter the space, given more consumers are adopting flexitarian diets — eating meat only occasionally.
Wall Street applauded Thursday’s announcement with shares (NYSE: TSN) rising 1.7% on the news early Thursday. Shares were trading at $83.81 in heavy volume.
Stephens Inc. analyst Pooran Sharma told Talk Business & Politics the new brand is seen as a positive for Tyson Foods. He said while the consumer market for non-meat proteins is considered niche right now, it is one of the fastest growing.
He said at one time organic chicken was also a niche market. Now it has gone more mainstream. Overall, he said it’s a market segment where Tyson Foods can try and grow share and market penetration given its strong relationships with retail and foodservice. Sharma expects Tyson Foods shares will trade higher on the news.
(Stephens Inc. does investment banking services for Tyson Foods and is compensated accordingly.)
Two years ago, Tyson Foods hired Justin Whitmore as executive vice president and chief sustainability officer to lead all aspects of the new alternative brands.
“The creation of the Raised & Rooted brand is an excellent example of Tyson’s ability to think big and move fast, capitalizing on our existing infrastructure,” Whitmore said. “We began development of our alternative protein products last year and have succeeded in creating a new brand and bringing those products to market in well under a year. Customers tell us they love the taste and nutritional attributes and are excited to partner with us.”
Tyson Foods said the Raised & Rooted brand nuggets are made from a blend of pea protein isolate and other plant ingredients and they contain five grains of fiber and omega-3s and less saturated fat than tradition nuggets.
The blended burger is made with Angus beef and pea protein isolate and has fewer calories and less saturated fat than the plant-based burgers sold by several competing companies.
The Aidellis Whole Blends products sold in retail already include a portfolio of fully-cooked sausage links and meatballs made with a blend of high quality, no antibiotics ever chicken and plant-based ingredients such as chickpeas, black beans, quinoa, lentils, and barley.
“While most Americans still choose meat as their primary source of protein, interest in plant and blended proteins is growing significantly,” said Noelle O’Mara, Tyson Foods’ chief marketing officer. “These products appeal to a broad cross-section of consumers who enjoy food from a variety of protein sources and we expect interest to continue to grow across protein types. The Raised and Rooted launch and our pipeline of innovation will reflect our consumers’ expectations for 100% plant-based, blended, and traditional protein offerings.”
Tyson Foods said its venture capital fund Tyson Ventures will continue to invest in startup companies involved in alternative proteins. The company has a stake in mushroom-based protein producer Myco Technology, cell-based meat producers Memphis Meats and Future Meat Technologies. Tyson Foods did recently exit its ownership share of Beyond Meat related to competitive tensions. Beyond Meat recently launched a public offering, and company shares (NASDAQ: BYND) traded lower on Tyson Foods’ news with shares falling more than 3.25% to $137.36. The stock went public at $46 per share on May 2 and has continued to pick up steam in the past month.