Nestle partners with Canada-based Burcon and Merit for plant-based proteins

The Swiss food giant will now be able to use Burcon and Merit's plant-based proteins in its own food and beverage products

Nestle on Friday announced that it has entered into a joint collaboration with Merit Functional Foods and its technology partner Burcon NutraScience to speed up innovation in the fast growing plant-based protein segment. The collaboration comes at a time when an increasing number of people across the globe are switching to dairy-free drinks.

Products like oat-milk and soy milk have gained substantial popularity over the past few years. Nestle isn't the only company trying to capture the plant-based protein market. Lately, a number of other big players too have into similar collaborations to speed up innovation in the plant-based business segment.

A timely collaboration

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Nestle has already been trying to tap the lucrative plant-based protein segment. The Swiss food giant last year launched soy and wheat-protein based burger brand, Incredible Burgers, in Europe which has already gained popularity. The partnership with the Canadian plant-based food ingredient maker will now enable Nestle to develop and commercialize Merit and Burcon's plant-based protein products for use in its own food and beverage products, including non-dairy products.

"The partnership with Burcon and Merit will give us access to unique expertise and a new range of high-quality ingredients for plant-based food and beverages," said Stefan Palzer, Nestlé's chief technology officer. Burcon's strength lies in making plant-based proteins extracted from non-dairy products like oat milk, soy, pea, hemp, sunflower and various other products. The company has been developing this technology for the past 19 years.

Merit Functional Foods on the other hand has been using Burcon's technology and has been attempting to build a commercial-scale factory to produce plant-based protein products. The facility is likely to be completed by the fourth quarter of 2020.

Plant-based protein drinks market growing

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Nestle isn't the only company trying to tap the fast-growing plant-based protein products market. Lately, Starbucks too introduced oat milk and two other non-diary drinks for its US and Canadian customers.

An increasing number of Americans are shunning cow milk and going for non-diary alternatives. The popularity of oat milk has been on the rise since 2016 with the entry of Oatly in the US market. Oatly's oat milk soon struck a chord with customers who have been fast switching to non-diary drinks. This saw sales of oat milk jump substantially. In fact, oat milk sales have surged a whopping 636% in the 52 weeks ending October 26, 2019.

Also, the non-diary drink market reached $2.3 billion in 2018 according to Mintel. Nestle thus seems to have made the right move. It thus makes sense for Nestle to further penetrate the plant-based protein segment given that it already is making its presence felt with plant-based burger market with Incredible Burgers.