Nutrition: Why are substitute products more expensive than meat?

Whether schnitzel, minced meat or bratwurst: consumers now have a wide range of meat substitute products available in German discounters and supermarkets.

Nutrition: Why are substitute products more expensive than meat?

Whether schnitzel, minced meat or bratwurst: consumers now have a wide range of meat substitute products available in German discounters and supermarkets. Only: Compared to meat, the substitute products are often - and sometimes significantly - more expensive.

The discounter Lidl announced on Wednesday that it would align the prices for almost the entire range of its own vegan brand with comparable products of animal origin. To date, vegan alternative products have been significantly more expensive than comparable animal products. With the campaign, Lidl not only wants to appeal to vegetarians and vegans, but also to flexitarians - i.e. people who consciously limit their meat consumption.

Survey: 41 percent flexitarian

A representative survey published in September by the Federal Association of the German Food Trade suggests that the campaign can not only be good for the image, but also for the coffers. Nine percent of those surveyed eat a vegetarian diet and three percent vegan. 41 percent described themselves as flexitarians.

The average price reduction was around twenty percent, a Lidl spokesman said upon request. When making the selection, it was important to the discounter to select animal comparison items that are currently part of the standard selection for the majority of customers. For example, for the vegan mince, the comparison product is the cheap mixed minced meat - and not the much more expensive organic minced beef.

In a sample in a Karlsruhe Lidl branch at the beginning of the week - before the price reduction - the 275 gram pack of vegan mince from the own brand "Vemondo" cost 3.29 euros. The price per kilo was therefore 11.96 euros. The cheap mixed minced meat cost 5.79 euros for an 800 gram pack. The price per kilo: 7.24 euros.

But why are vegan substitutes actually more expensive than meat?

"Meat means mass production"

“Meat means mass production,” says trade expert Gerrit Heinemann from the Niederrhein University of Applied Sciences. The aim of the industry is to produce in the largest possible quantities, which means that the costs per unit are lower. This allows cheap meat to be offered. Vegan substitute products could not keep up with the quantities. “That’s why they are simply more expensive,” says Heinemann.

Lasse van Aken, agricultural expert at the environmental protection organization Greenpeace, points to the VAT rate. A reduced VAT rate of seven percent applies to meat and sausage. However, 19 percent is due for replacement products. “We criticize that very strongly,” says van Aken. The VAT rate for meat must be increased. In return, plant-based alternatives should be taxed at zero percent, he demands.

The market for vegetarian or vegan meat alternatives in Germany has grown significantly in recent years. According to the Federal Statistical Office, 104,300 tons of meat substitute products were produced last year. That is 6.5 percent more than in the previous year and even 72.7 percent more compared to 2019.

Growth is weakening

However, the market research company GfK recently found in an analysis that growth will have stalled in the first half of 2023. According to this, sales only increased slightly by two percent, but the quantity sold fell by three percent compared to the same period last year. This cannot be attributed to the number of buyers. According to the analysis, this increased by 3.6 percent. Instead, households bought less often and less than in the first half of 2022.

Hanna Kehl, GfK consumer behavior expert, gives various reasons for this. She observes substitution relationships with other products. “Perhaps consumers will once again put cheese on their bread instead of vegan sausage,” says Kehl. Or they went directly to purely plant-based products. The price certainly also plays a role given inflation.

“It’s far from the end of the road”

From the point of view of retail expert Heinemann, this is a temporary phenomenon due to weak purchasing power. In the medium to long term, however, there will be more dynamism again. Avoiding meat is a huge issue and “far from being the end of the road.”

When asked by the German Press Agency, other discounters and supermarkets remained tight-lipped about the differences in prices, the reasons for them and possible adjustments. Aldi Süd and Aldi Nord announced that the prices basically followed the market economy principle of supply and demand. Kaufland did not provide any specific information about pricing. Rewe said it was “unable to support the research with information and statements”.

Edeka said that the demand for vegan foods has increased significantly in recent years. This reduces production costs, which means that many vegan items can now be offered very cheaply. In many cases also cheaper than animal products. This particularly applies to own-brand items, which are particularly tightly priced.