Germany and alternative proteins: a new study highlights the potential.
The global food supply chain is undergoing a profound transformation. While the demand for protein sources continues to grow, the environmental, health, and economic limitations of intensive livestock farming and excessive natural resource consumption are becoming increasingly evident.
Against this backdrop, Systemiq, in collaboration with the think tank The Good Food Institute Europe, has conducted a detailed analysis of the economic potential of alternative proteins in Germany. The study, titled A Taste of Tomorrow – How Protein Diversification Can Strengthen Germany’s Economy, explores the impact that a decisive investment in plant-based, fermentation-derived, and cultivated proteins could have on the German economy and job market while also opening up new global opportunities.
Alternative proteins: an economic and environmental opportunity
Alternative proteins represent a strategic driver for economic growth and collective well-being.
Why focus on alternative proteins?
The report highlights that the transition to alternative proteins is no longer just an ethical or environmental issue but a driving force for economic, industrial, and technological development. Plant-based proteins and those obtained through fermentation—both biomass and precision fermentation—offer numerous advantages and opportunities.
Firstly, they meet growing consumer demand. According to the report, over 35% of German households purchased plant-based products at least once in 2023. Among these buyers, 70-75% made repeat purchases—an indication of satisfaction that fosters consumer loyalty. At the same time, alternative proteins provide significant environmental benefits: intensive animal farming accounts for 15-20% of global greenhouse gas emissions and requires vast amounts of land and water. By contrast, producing alternative proteins has a significantly lower environmental impact regarding emissions, land use, and water consumption.
Moreover, consuming these products can reduce public health risks. When well formulated, alternative protein-based foods contain lower saturated fats and are cholesterol-free, making them a healthier option than animal meat. This could help combat widespread health issues such as cardiovascular diseases and obesity, which place an increasing burden on healthcare systems in many Western countries.
Finally, the alternative protein sector presents a major opportunity for economic growth and job creation. It requires advanced expertise in biotechnology and manufacturing, particularly machinery and production equipment. This opens new opportunities for companies already operating in the food sector and those looking to pivot or diversify their business to enter this expanding industry.
The German case: figures and scenarios
The Systemiq study outlines three possible scenarios for Germany by 2045, depending on the level of institutional and private sector support:
- Business-as-usual scenario: Without significant policy interventions and investments, Germany’s alternative protein market could reach €8 billion by 2045, creating around 115,000 jobs. In this scenario, Germany risks losing its current European leadership, limiting export potential and slowing technological progress.
- Medium-ambition scenario: A moderate but consistent level of public and private support—such as increased research funding, adequate infrastructure, and streamlined regulatory processes—could drive the market to €14 billion by 2045, generating approximately 180,000 new jobs. Germany would keep pace with global developments but would not necessarily lead.
- High-ambition scenario: The most optimistic scenario envisions strategic investments of around €260 million per year in R&D, infrastructure, and market access (ensuring faster and more transparent approval processes for Novel Foods). The domestic market could exceed €23 billion by 2045, representing around 10% of Germany’s current food & beverage sector revenue. Job creation could reach 250,000, generating an overall economic impact of up to €65 billion in added value.
Notably, in this high-ambition scenario, sector growth would not be driven solely by producing “ready-to-eat” alternative proteins but also by exporting technologies, equipment, and components for the global alternative protein industry. With its strong mechanical engineering and process automation tradition, Germany could become a key hub for machinery and systems dedicated to extrusion, fermentation, cell cultivation, and more.
Challenges and solutions: the role of institutions
The report underscores the need for more decisive and coordinated institutional action to unlock the potential of alternative proteins. Estimates suggest that at least €260 million in public investment per year would be required, directed at various strategic areas: research, innovation, low-interest loans, and guarantees for companies in the sector.
One key objective is to accelerate research and development. Companies working on cutting-edge technologies, such as cultivated meat and precision fermentation, require capital to build pilot plants and scale up production. Without adequate resources, Europe risks falling behind countries that are already investing more decisively in these solutions.
Another crucial aspect is establishing a clearer and more streamlined regulatory framework. The EU’s Novel Food approval process imposes stringent safety standards, often resulting in lengthy and complex bureaucratic procedures. Providing businesses with more transparent regulations and predictable approval timelines could encourage innovation and facilitate the entry of new products into the market.
Additionally, the transition of traditional agriculture must be managed effectively. Farmers fear economic losses as demand for animal feed ingredients declines. However, if properly supported, this shift can become an opportunity. Encouraging the cultivation of legumes, specific cereals, algae, and other raw materials for the alternative protein industry could offer new prospects for farmers while strengthening supply chain resilience and independence.
Finally, institutions can play a key role in promoting the adoption of alternative proteins through public catering. Corporate, school, and hospital canteens represent a strategic channel for integrating these products into consumers’ daily diets. Through public procurement and targeted supply policies, the state could drive the adoption of these new food solutions, gradually familiarising people with different tastes and formats and stimulating wider market demand.
Economic, environmental, and health benefits
In addition to the potential to generate up to 250,000 jobs and €65 billion in added value, the report highlights several socio-environmental benefits:
- Emission reductions: The high-ambition scenario could prevent the release of approximately 8 million tonnes of CO₂ per year—the equivalent of removing around two million cars from the roads.
- Better land use: With less need for animal feed crops, up to 1.8 million hectares of land could be freed up for higher-value agriculture or ecosystem regeneration.
- Lower water consumption: In an advanced scenario, up to 129 million cubic metres of water per year could be saved—equivalent to the annual consumption of 720,000 German households.
- Public health benefits: With an overweight and obesity rate of approximately 50%, Germany, like Italy and many other countries, faces significant healthcare costs related to cardiovascular diseases, diabetes, and other diet-related chronic illnesses. The availability of foods that are free from cholesterol, antibiotics, and hormones, and lower in saturated fat, could assist in reversing this trend.
Food for thought: the situation in Italy
While Germany is currently a leading hub for alternative protein innovation, Italy is also demonstrating growing interest and dynamism, with significant expansion in the plant-based market. According to the latest data from the Good Food Institute Europe, retail sales in 2022 exceeded €680.9 million, marking a 21% increase compared to 2020. Italy now ranks third in Europe in terms of total sales value, reflecting a broad and expanding consumer base.
Despite these positive figures, there is still room for growth. Per capita spending remains lower than in other European countries, suggesting untapped market potential. Some segments—such as plant-based meat and ready-to-eat plant-based meals—have seen the most substantial growth, indicating a rising interest among consumers. At the same time, the adoption of innovative technologies could open up new employment opportunities across the entire supply chain, from biotechnological research and equipment manufacturing to the cultivation of legumes and cereals destined for alternative protein production.
As demand for sustainable and healthy food continues to grow, Italy has an opportunity to strengthen its leadership by combining culinary tradition with food innovation. A well-coordinated national strategy—including research incentives, agricultural support, and pilot projects—could help the country capitalise on the global shift towards alternative proteins, generating economic value and positioning “Made in Italy” as a benchmark in this emerging sector.
Drawing inspiration from Germany’s “high ambition” approach—with more structured policies and stronger coordination between institutions, academia, and industry—could enhance Italy’s competitiveness. This, in turn, would support the development of an integrated supply chain capable of fostering expertise, creating jobs, and delivering more sustainable and innovative food solutions.
