Plant-based meat creeps its way into McDonald, fast food — becoming a $14B opportunity

The competition among purveyors of plant-based protein is heating up the fast food industry with a frenzy that resembles the increasingly hot chicken sandwich wars.

On Thursday, McDonald's (MCD) announced its plan to test its first ever plant-based burger, the McPlant, it created with Beyond Meat (BYND) in a strategic three-year partnership. For now, however, the Sept. 29 launch is limited to 10 restaurants in the United Kingdom and Ireland. On October 13th, it will expand to 250 locations before rolling out more broadly both the United Kingdom and Ireland by 2022.

After three years of research and development, the Golden Arches cooked up plant-based patty served on a vegan sesame bun with vegan cheese that's based on pea protein and a new vegan sauce. It is served with traditional toppers like onions, pickles, lettuce, tomato, ketchup and mustard.

McDonald's also made it clear that it will be cooked separately from other burgers and sandwiches using dedicated utensils — perhaps taking note of the trouble that embroiled Burger King (QSR), which introduced its plant-based Impossible Whopper in 2019.

The chain was sued by a vegan customer who claimed the restaurant chain was taking part in “false and misleading business practices" when advertising its plant-based entree. Burger King later won the lawsuit in 2020 after a federal judge dismissed the lawsuit.

Plant-based market: a $14B opportunity

McDonald's pilot, and the mushrooming fake meat options in the notoriously meat-friendly fast food industry, are the latest sign of how the sector is adopting itself to a more health-conscious demographic. According to a new report from food intelligence firm Tastewise, menu mentions of plant-based meat spiked by a staggering 1,320% in the U.S. compared to pre-pandemic levels in early 2020.

Fake meat's march into fast food chains shows no signs of slowing down. Burger King's Impossible Burger was followed by Starbucks' June 2020 launch of the Impossible breakfast sandwich — which was then followed by Dunkin's Beyond Meat breakfast sandwich.

And 2021 has become the dawn of other plant-based entrees, like Morningstar Farms (K) to introduce the Southwest Veggie Power Breakfast Sandwich and Wendy's Spicy Black Bean Burger.

"This is one of those rare moments in history where the business opportunity and the betterment of the world align," Alon Chen, Co-Founder and CEO of Tastewise told Yahoo Finance in an email. "Plant-based is both the right thing to do for the world, and for exponential growth over the next decade."

However, it's not just vegans being lured to meatless foods — evidence suggests there are many others who are making the shift for different reasons.

"Consumers from all lifestyles are expecting brands to address concerns about climate change, sustainability, and personal health," Chen said.

"This shift has created a $14B opportunity over the next decade, where the question is not 'if' every foodservice business must offer plant-based alternatives, but 'when' and which technology will prevail," he added.

Tastewise data shows the playing field is still tilted in favor of traditional meat, with plant-based options — at least for now — comprising a slim portion of menu options. However, many think there's a major opportunity for food producers: Right now, the total plant-based market is worth nearly $7 billion dollars in the U.S., with plant-based meat in particular lending just $1.4 billion dollars of that total.

While opportunity exists within this market, 54% of Americans have already tried the meatless options at popular fast-food chains, according to a recent survey by Piplsay. Of that number, 70 percent said that they enjoyed it.

With Burger King being an early entrant in the competition, most have tried plant-based meat there. According to Piplsay, 41% of consumers have tried BK's meatless entrees, followed by 10% at Starbucks, 10% at Wendy's (WEN), 10% at Subway's, and 8% at Dunkin'. Elsewhere, less then 7% have tried it at other places including Del Taco, Qdoba, Carl's Jr. and others.

And plant-based chicken options are also on the rise. Recently Panda Express collaborated with Beyond Meat to bring Beyond the Original Orange Chicken to its menus, and Shake Shack (SHAK) offered a limited-edition vegan menu item.

Lastly, fake seafood is also making its way onto menus and bubbling up on the Internet — up 90.7% in social interest according to Tastewise. Recently, Long John Silver’s and Whole Foods have leaned in on the fish-less category.

Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.