‘Pacific pact to propel Philippine plant protein production’
(First of three parts)
Stephen Michael Co bends toward the mahogany table to pick a slice of a hotdog that looks like a Nuremberg bratwurst with its peanut-like shade and peppery inside.
Co chews on the hotdog, pauses for five seconds and smiles to his colleague. Grinning, he says the product finally tastes like sausage made out of meat. He shakes his head in disbelief that his team managed to create a variation of the popular breakfast food out of soy.
The owner of Worth The Health (WTH), a startup that prepares meat alternatives, told The STAR he would seek out small-scale restaurants that may want to include the soy-based hotdog on their menu to test its appeal to diners.
WTH makes its plant-based food in a pocket room beside a brewery and a bar also managed by Co. Established in 2019, Co feels he got lucky that his team gambled on putting up WTH, not knowing that the nightlife industry will flatline the following year.
The brewery, bar and kitchen are cramped up in a space covering roughly 100 square meters in downtown Makati City. Co and his business partners look to lease a manufacturing facility in an economic zone in Cavite or Laguna where they can centralize their beer and food outputs.
They are just waiting for one development: that the Philippines signs up for the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP.
In March the Department of Trade and Industry (DTI) announced it eyes to enlist the Philippines in the CPTPP to unlock new markets for automotive parts, farm produce, garments, plant-based food and electronics.
If the Philippines joins the CPTPP, Co vowed his team will push through with the plan to expand business, as the trade deal provides firms like WTH export access to Canada, one of the largest markets for meat alternatives.
“We are optimistic about the prospects of exporting to Canada because even its government is funding the industry. Canada is also one of the largest producers of pea and one of the legumes that we can use as a base for the food we develop,” Co said.
Contrary to the Philippines where demand for meat alternatives is just developing, the market in Canada for vegan products now amounts to $500 million based on data from Nielsen. Likewise, the Trudeau administration last year invested nearly $100 million in a Winnipeg firm engaged in the plant-based food trade.
With state funding, Merit Functional Foods can now process 17,000 metric tons of canola seeds and 10,000 MT of yellow peas every year.
Canadian investments in the Philippines declined by an average of about 30 percent from 2016 to 2020 on risks posed by the move to lift fiscal incentives and, lately, the lockdowns to manage local outbreaks.
In spite of this, Co views the CPTPP as a window for Canadian investors to return to their usual activities here, as well as explore emerging industries like meat alternatives.
As with any manufacturer of plant-based food, WTH has its eyes set on acquiring an equipment called extruder. Based on industry estimates, an extruder can cost as much as $1 million, but it pays its owner the capacity to process 500 kilos of food an hour.
For every opportunity, however, entails a risk. As plant-based food makes use of farm products to substitute for the meat component of a meal, Co doubts that the agriculture sector can supply the requirements of firms like WTH in the long run.
In the case of WTH, for instance, its corned beef, shredded meat and nuggets are made out of jackfruit; its ground meat and spring rolls are based on mung beans (mongo); and the hotdog is prepared with soy.
According to the Philippine Statistics Authority, the country’s import dependency ratio for mongo climbed to 50.5 percent in 2019, from 47.8 percent in 2015, which means more than half of the supply for the commodity now comes from abroad.
As a net buyer of soybean meal (SBM), the Philippines imported an all time high 2.9 million MT of SBM last year that the US, the country’s largest source of the commodity, gained a record $899 million from it.
Jose Enrique Africa, executive director for think tank IBON Foundation, said the DTI appears to exaggerate the opportunities for meat alternatives in the CPTPP. He doubts the sustainability of relying on imports for ingredients like soy, as this dependence will offset the benefit of infiltrating the Canadian market.
“It also matters what meat alternatives are targeted. For instance, the usual wheat or soy-based products would be self-limiting because we’re so dependent on imports for these,” Africa said in an interview with The STAR.
“The opportunity seen for plant-based meat alternatives seems overstated. The Philippine meat alternative industry is in its incipient stages. Any gains will be incremental because the industry is still so small,” he added.
Further, Africa warned micro, small and medium enterprises like WTH may struggle to compete with the food giants in Canada, as well as in the United States and the United Kingdom, both of which are planning to also join the CPTPP.
At the bar, Co looks out of the window to survey if by any miracle a customer walks in to down a mug of draft beer and feast on meat alternatives for pulutan.
Co then shares WTH’s vision to introduce local protein sources, especially adlay and mongo, as viable ingredients to make plant-based food. He hopes the CPTPP provides an avenue not only for startups like WTH, but also for small scale farmers to increase their income.
(To be continued)