After the plant-based protein market collapses, Kellogg’s will no longer divest Morningstar.

What to know

In 2018, Kellogg’s refocused its Morningstar Farms brand around plant-based protein. Originally, Morningstar Farms offered breakfast meats and chicken nuggets, but by 2021, the brand’s offerings were 86% plant-based. “We like the sustained growth and potential for this brand,” Sara Young, the Kellogg VP in charge of the brand, told investors. “In many ways, plant-based protein represents an emerging market right here in North America.”

At the time, strategic logic was sound. Beyond Meat, the first and perhaps best-known offering, was a media darling. It used the buzz to catapult itself to a market capitalization of $7 billion. Rumors revealed that a private competitor, Impossible Foods, was valued at nearly $10 billion. It made sense that legacy food companies entered the space.

The pitch was simple. Industrial agriculture, specifically protein, is a huge contributor to climate change. Some estimates attribute 26% of greenhouse gas emissions to our food system- with animal protein being the biggest cultprit. What if you could reduce those emissions by producing an equivalent protein-that tasted the same-in a lab?

Making things sweeter for business, the technology could be patented. Meaning a business could hold a monopoly on protein. It was a compelling narrative. Suddenly, it was conventional wisdom that plant-based proteins were a trillion-dollar market…