As the diversity of plant sources to extract protein increases, and big market research firms are still catching up on creating granular market data breaking it down per plant source, insight from manufacturers provide a useful glimpse of how the plant-based trend is continuing its momentum.
“We are seeing an increased demand for plant-based formulations in both nutritional bars and powders,” Child said. “[They] fulfill consumers’ desire for products with functional benefits from natural sources and simple labels with a short list of recognizable ingredients.”
Today, finished product brands have options as varied as pea to rice to chia to algae as a protein source. Ingredient suppliers and manufacturers, big and small, are racing to create the most bio-available plant proteins, or the most novel source to differentiate itself (like the duckweed-derived Lentein by Florida start-up Parabel).
A rapid increase in 2016, slower growth for soy
In addition to the numerous protein startups and newcomers that use plant protein (think ALOHA and Oriya), this past year saw big brands jump on the plant protein bandwagon. For example, personal care brand Burt’s Bees launched its own line of plant protein powders, and legacy brand PowerBar launched a line of plant protein bars.
According to Child, Nellson’s revenue from plant-based products increased by 38% over the past year compared to just 2% for whey. The outlier here is soy, which, unlike its other plant protein counterparts, dipped by 5%.
While many new food and beverage products proudly claim to be soy-free, it is not exactly the case in the supplement aisle. At Nellson, “soy is most popular, based on size of market, maturity in the market, cost effectiveness, supply, and versatility of use in application,” Child said.
Backing up Child’s claim are numbers from SPINS, which recorded a 2.0% sales increase for energy bars and gels containing soy from 2015 to 2016 in the US, and an 18.7% increase for meal replacements and supplement powders. The shining star among all other soy protein subcategories was ready-to-drink (RTD) meal replacement beverages, up 26.4% in the 52 weeks ending Sept. 4 2016.
The second leading plant source, Child said, was pea, "and it continues to improve with maturity of supply chain." Other plant sources for protein that Nellson works with includes rice, potato, pumpkin, black bean, algae, chia, and hemp.
Growing with new facilities
As demand grows, Nellson is expanding its manufacturing facilities. It currently manufactures plant powders in Anaheim, CA, while its bars are made in its facilities in Irwindale, CA, and Montreal, QC.
Due to open in October this year is a 300,000-square-foot facility in Ontario, CA, to be decked out with an R&D lab, segregated production lines to provide brand confidentiality and maximum allergen control, as well as new packaging capabilities.
It’s part of Nellson’s aggressive transformation under the new ownership by private equity firm Kohlberg & Company.
“In Montreal, we have best-in-class bar making capabilities in the former MultiBar facility and our Lachine facility, where we recently invested over $15 million to expand capacity and upgrade our operations; we also just completed a $10 million upgrade and expansion of our Anaheim powder plant,” said Jamie Better, CEO of Nellson.
“These investments reflect our determination to be the co-manufacturing partner of choice for the leading brands in the nutritional bar and functional powder marketplace.”