Thanks Hannah, the other and more important side of this is why substitutes for meat are so expensive. I think the answer is the market they cater to. As you rightly point out, one can learn to cook beans and tofu, that will be much cheaper and healthier than meat substitutes. So meat substitutes are by definition not for those willing to pay this premium.
I do think some plant-based products could be made that are easier to cook - just giving-up on trying to resemble meat. Some tofu products in Asia are delicious, cheap, and extremely convenient to cook. Profit margin on that is low, though, so don't expect a western firm to invest anything in that space, shareholders would not allow.
Thanks Hannah, great and insightful article, just one little caveat.
Mostly I agree with your conclusion, we need to get alternative proteins a lot cheaper. I do think, we are some 10-15 y behind what happened to LED Lighting, Solar Energy and now Batteries and EVs. Alt Protein prices are coming down, we are just behind the very first hype cycle. And in fact an exciting trend we are currently seeing is hybrid proteins. So beef mince with pea protein or mushrooms in there. Creating a cheaper product, with lower emissions and better health properties. Super exciting.
My caveat: Your back of the envelop calculation for EU comes to 0.25EUR/kilo for meats and milks. I agree for meat that sounds moderate, but what about milk? If I understand your calculation correctly, you do include the milk production. And I remember correctly, milk prices used to be around 0.4EUR/kilo in total farmers sales price. There 0.25EUR subsidy seems quite massive no? And let's keep in mind, at the end, every milk cow, at some day will turn into a burger. So that money, actually also supports keeping beef prices down....
The passage about prices in the US is misleading IMHO, because it aggregates subsidies (which tend to lower prices) with tariffs (which tend to raise them) and perhaps other supports. The wording in the text emphasizes that the prices wouldn't *fall* by very much if all of these were removed; but unless I'm missing something, what we're actually interested in is how much they'd *rise* by if only the subsidies were removed.
I agree with you -- it's one of the reasons I've been researching meat taxes more than meat subsidies in my work. While meat taxes aren't very popular, they have more potential to level the playing field more. I also think advocates should focus on, as you mention, increased government subsidies for alternative proteins, like Denmark has.
Another problem with subsidies that you touch on is that removing them may actually hurt animal welfare. If smaller farms are forced to close, it'll be the big factory farms that stay in business and gobble up that market share, which usually have worse animal welfare practices. In the grand scheme of things, it might not be a big change (since only 1-6% of farmed animals aren't raised in factory farms) but it's still something.
The prices of food are most affected by the whole costs of living of inefficient administration heavy, artificially owned land and capital equipment assumed to be required for captured agriculture. Non regenerative fields remain a symptom of stationary agriculture trying to optimize every years production in markets that inversely reward sucsess in squeezing ever more out of each owned acer with higher costs and generally lower prices.
Most value added cost comes anyway post farm. If farmers cooked the food and globally rented field and process machinery that did not sit idel 95% of it’s life then field to table costs would be significantly lower. Using fully automated smaller machines shipped world wide in advance mobility global economics is required. But this is not as manufacturer profitable as having 95% idle equipment in every farm back yard.
It all adds up along with cost shares for the financilization cost overhead and soil quality deterioration plus long trend multi seasonal unpredictable changes. Weather trends from human effects might give rains some places while historical droughts other places. Water tables and full spectrum fertilizer costs change as natural sources become scarcer. Feed crops for cows make chicken meat cheaper but the difference in costs at fast food places does not seem to follow well the cost of meat off farms and out of sea food canaries.
What does the data say on all of this Hanna? I am not as intelligent as you but wish you could throw some light on probabilities of a future nuclear winter war that starves must of the world. Meat prices aside.
I think the cross-subsidies of meat for human consumption and an animal's other uses are interesting - for example, dog and cat food is supposedly one fifth of meat consumption in the US, but is brushed aside as using the parts of the animals that humans won't eat. If this is true, it's subsidising human consumption by selling off food for animals. I suspect it's not quite true based on what my mum feeds her pets!
Thanks Hannah, the other and more important side of this is why substitutes for meat are so expensive. I think the answer is the market they cater to. As you rightly point out, one can learn to cook beans and tofu, that will be much cheaper and healthier than meat substitutes. So meat substitutes are by definition not for those willing to pay this premium.
I do think some plant-based products could be made that are easier to cook - just giving-up on trying to resemble meat. Some tofu products in Asia are delicious, cheap, and extremely convenient to cook. Profit margin on that is low, though, so don't expect a western firm to invest anything in that space, shareholders would not allow.
Thanks Hannah, great and insightful article, just one little caveat.
Mostly I agree with your conclusion, we need to get alternative proteins a lot cheaper. I do think, we are some 10-15 y behind what happened to LED Lighting, Solar Energy and now Batteries and EVs. Alt Protein prices are coming down, we are just behind the very first hype cycle. And in fact an exciting trend we are currently seeing is hybrid proteins. So beef mince with pea protein or mushrooms in there. Creating a cheaper product, with lower emissions and better health properties. Super exciting.
My caveat: Your back of the envelop calculation for EU comes to 0.25EUR/kilo for meats and milks. I agree for meat that sounds moderate, but what about milk? If I understand your calculation correctly, you do include the milk production. And I remember correctly, milk prices used to be around 0.4EUR/kilo in total farmers sales price. There 0.25EUR subsidy seems quite massive no? And let's keep in mind, at the end, every milk cow, at some day will turn into a burger. So that money, actually also supports keeping beef prices down....
best
Tilman
The passage about prices in the US is misleading IMHO, because it aggregates subsidies (which tend to lower prices) with tariffs (which tend to raise them) and perhaps other supports. The wording in the text emphasizes that the prices wouldn't *fall* by very much if all of these were removed; but unless I'm missing something, what we're actually interested in is how much they'd *rise* by if only the subsidies were removed.
I agree with you -- it's one of the reasons I've been researching meat taxes more than meat subsidies in my work. While meat taxes aren't very popular, they have more potential to level the playing field more. I also think advocates should focus on, as you mention, increased government subsidies for alternative proteins, like Denmark has.
Here's my post on it: https://morethanmeatstheeye.substack.com/p/meat-taxes-are-super-risky-maybe
Another problem with subsidies that you touch on is that removing them may actually hurt animal welfare. If smaller farms are forced to close, it'll be the big factory farms that stay in business and gobble up that market share, which usually have worse animal welfare practices. In the grand scheme of things, it might not be a big change (since only 1-6% of farmed animals aren't raised in factory farms) but it's still something.
The prices of food are most affected by the whole costs of living of inefficient administration heavy, artificially owned land and capital equipment assumed to be required for captured agriculture. Non regenerative fields remain a symptom of stationary agriculture trying to optimize every years production in markets that inversely reward sucsess in squeezing ever more out of each owned acer with higher costs and generally lower prices.
Most value added cost comes anyway post farm. If farmers cooked the food and globally rented field and process machinery that did not sit idel 95% of it’s life then field to table costs would be significantly lower. Using fully automated smaller machines shipped world wide in advance mobility global economics is required. But this is not as manufacturer profitable as having 95% idle equipment in every farm back yard.
It all adds up along with cost shares for the financilization cost overhead and soil quality deterioration plus long trend multi seasonal unpredictable changes. Weather trends from human effects might give rains some places while historical droughts other places. Water tables and full spectrum fertilizer costs change as natural sources become scarcer. Feed crops for cows make chicken meat cheaper but the difference in costs at fast food places does not seem to follow well the cost of meat off farms and out of sea food canaries.
What does the data say on all of this Hanna? I am not as intelligent as you but wish you could throw some light on probabilities of a future nuclear winter war that starves must of the world. Meat prices aside.
I think the cross-subsidies of meat for human consumption and an animal's other uses are interesting - for example, dog and cat food is supposedly one fifth of meat consumption in the US, but is brushed aside as using the parts of the animals that humans won't eat. If this is true, it's subsidising human consumption by selling off food for animals. I suspect it's not quite true based on what my mum feeds her pets!
I am now more confused about the economics of animal agriculture!