A recent analysis conducted by Systemiq and supported by the Good Food Institute (GFI Europe) highlights the substantial economic potential of alternative proteins in Germany, projecting an increase of up to €65 billion in economic output and the creation of 250,000 new jobs by 2045. The report underscores the importance of political support and strategic investments to unlock this potential.

The report, titled 'A taste of tomorrow: How protein diversification can strengthen Germany’s economy,' is the first of its kind to assess the implications of plant-based, fermentation-derived, and cultivated foods on Germany’s economy. It outlines various scenarios based on levels of policy support, revealing that the future of the alternative protein sector hinges on regulatory frameworks and investment strategies.

Under a conservative scenario – characterised by minimal political backing – the domestic market for alternative proteins could reach €5 billion by 2030 and €8 billion by 2045. Even in this limited context, the sector could generate approximately 45,000 jobs by 2030 and 115,000 by 2045. However, such a trajectory would likely diminish Germany's current leadership in the global market.

In contrast, a high-ambition scenario, bolstered by significant regulatory and investment support, could see the domestic market grow to €10 billion by 2030 and €23 billion by 2045. This ambitious outlook suggests that alternative proteins could account for around 10% of Germany's food and beverage industry revenues, creating up to 95,000 jobs by 2030 and a total of 250,000 jobs by 2045.

Germany’s unique position as a leader in mechanical engineering and manufacturing offers a strategic advantage in the alternative protein sector. The country could not only meet domestic demands for sustainable food but also become an industrial hub for producing machinery essential for the global alternative protein market.

The report estimates that export opportunities could reach €15 billion by 2030 and €35 billion by 2045 under the high-ambition scenario.

The shift towards alternative proteins is not solely an economic opportunity; it also aligns with broader environmental goals. The analysis indicates that by 2045, greenhouse gas emissions could be reduced by 4.8 to 8.1 million tons of CO₂ equivalent, equivalent to the emissions produced by 1 to 1.8 million cars.

Additionally, land use could decrease by up to 2 million hectares, and freshwater consumption could be lowered by 76 to 129 million cubic metres, benefiting over 420,000 German households.

Policy recommendations for growth

To harness these opportunities, the study identifies several critical policy interventions:

Regulatory support: Streamlining approval process for novel foods to facilitate market entry.

Increased R&D investment: Raising public research and development funding from €13 million to €140 million annually, including establishing an innovation hub.

Private investment catalysts: Deploying €120 million per year to encourage private investments in alternative protein infrastructure.

Inclusion in public catering: Ensuring alternative proteins are integrated into community catering systems, such as schools and daycare centres.

Strengthening supply chains: Providing incentives for farmers to engage in diversified protein production.

Sophie Hermann, a partner at Systemiq, said: “Protein diversification presents a compelling solution, offering sustainable food options, boosting Germany’s economic competitiveness through innovation-driven export, and creating future-proof jobs. The alternative protein market is still in its early stages, with some uncertainty remaining."

"Over the next five years, developments in regulation, public and private investments, and technology will play a critical role in shaping the market’s trajectory and reducing this uncertainty. With concerted efforts from all stakeholders and the right policy support, Germany can position itself as a leader in protein diversification, driving strong innovation to secure future-proof jobs, economic growth, sustainability and food security.”

Meanwhile, Ivo Rzegotta, senior public affairs manager at GFI Europe, added: “German policymakers have a unique opportunity to make the nation a front-runner in protein diversification. The next federal government should incorporate the proposed policy interventions in its government agenda, particularly earmarking public investments for research and infrastructure and providing sufficient regulatory support."

He concluded: "These measures can incentivise both investor and corporate action, positioning Germany as a global forerunner in critical protein diversification. Failing to act decisively would not only forfeit these opportunities but also risk leaving Germany behind in an urgent transition with huge benefits for our economy and society.”

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