Precision fermentation is often framed as a competitor to plant-based food, but the reality may be far more collaborative. Suzanne Robb, senior market strategy manager at CPI, explores how fermentation could enable the next phase of alternative protein growth.

For the past decade, the alternative protein conversation has been framed as a contest of technologies. Plant-based foods, precision fermentation and cultivated meat are often presented as distinct and even competing categories vying for market share, consumer attention and investment, but this framing misses a crucial point.

In practice, precision fermentation isn’t emerging as a substitute for plant-based systems, but as a functional ingredient platform that enhances them. Its greatest impact lies in how it’s being integrated into commercial formulations and existing manufacturing systems to address specific performance gaps.

Moving beyond the ‘either/or’ mindset

Plant-based products have achieved significant commercial success, scaling rapidly by building on established agricultural supply chains and existing manufacturing infrastructure. Today, they represent the largest segment of the alternative protein market, accounting for a substantial share of category sales, according to Fortune Business Insights.

Yet despite this success, one persistent challenge remains: performance. While plant proteins are effective at delivering structure and protein content, they often struggle to replicate the complex functional properties of animal-derived ingredients. This is particularly evident in a few different use cases, including applications that rely on casein-driven gelation and melt behaviour in cheese, thermostable foaming and aeration in egg-based systems, stable emulsification across complex formulations, and the characteristic flavour development that occurs during cooking.

These limitations aren’t simply matters of taste; they directly affect process performance, product stability, and repeat purchase behaviour. And this is where precision fermentation comes in. By programming microorganisms to produce targeted functional molecules such as proteins, enzymes, fats and flavour compounds, precision fermentation enables the creation of ingredients that are molecularly identical to their animal counterparts.

Rather than replacing plant-based formulations, these ingredients are increasingly being integrated into them. Some of the most important advances in alternative proteins illustrate this complementary relationship clearly.

Recreating meat flavour and unlocking dairy functionality

One of the defining examples is the use of precision-fermented heme in plant-based meat. Impossible Foods’ soy leghemoglobin, produced via yeast fermentation, replicates the iron-containing molecule responsible for the characteristic flavour and aroma of meat.

This introduces a functional ingredient that catalyses key flavour reactions. Without it, plant-based burgers may look and feel like meat, but can lack the depth of flavour created during cooking meat. With it, they can deliver the ‘bleeding,’ aroma and taste cues that consumers associate with real beef.

From a formulation perspective, the significance lies in efficiency of impact. These ingredients are typically used at low inclusion levels, allowing developers to target flavour gaps without substantially altering the core protein matrix or cost structure.

Dairy presents an even clearer example. The proteins that give dairy products their characteristic performance, including melting, stretching, foaming and emulsification, are difficult to recreate using plant ingredients alone. Precision fermentation companies such as Perfect Day are producing animal-identical whey and casein proteins without the cow, allowing manufacturers to retain familiar functionality while expanding the possibilities for alternative dairy products.

The implication is significant: rather than trying to approximate cheese or yogurt using plant proteins alone, manufacturers can combine plant-based matrices with fermentation-derived proteins to achieve closer parity in texture and performance.

The same pattern is playing out across other ingredient categories. Precision fermentation is also used to produce egg proteins such as ovalbumin, which unlocks aeration, binding and emulsification in baked goods and processed foods. Meanwhile, fermentation-derived fats and oils are being developed to address one of the biggest gaps in plant-based products: richness and mouthfeel.

In each case, the role of fermentation is to help solve discrete functional challenges within broader formulations, not to replace plant-based formulations entirely.

A layered future, not a fragmented one

Taken together, these examples suggest that the future of alternative proteins is unlikely to be defined by a single technology. Instead, many manufacturers are adopting a layered approach that combines the strengths of different ingredients. Plant-based systems continue to provide the bulk structure, protein content and cost-efficiency needed for scalable products, while precision fermentation-derived ingredients are being used more selectively to deliver specific functional benefits and optimise performance.

Rather than competing with one another, the two approaches are increasingly working in combination to create products that better meet consumer expectations. This model enables more efficient formulation strategies, where functionality is engineered through selective ingredient inclusion rather than complex workarounds.

For product developers, this also reduces formulation trade-offs and enables more precise control over product attributes. As manufacturers look to improve flavour, texture and functionality without redesigning products from first principles, fermentation-derived ingredients are becoming increasingly embedded within broader formulation strategies.

While fermentation remains a smaller segment of the alternative protein market than plant-based foods, investment and commercial interest continue to grow as organisations explore its potential to enhance product performance and accelerate innovation. Precision fermentation is becoming embedded across the value chain, even if it remains largely invisible to consumers.

Why this matters for the next phase of growth

Early growth in the alternative protein sector was driven by novelty and values including sustainability, animal welfare and curiosity. But the next phase of the sector will be driven by repeat purchase, and that depends on product experience. Consumers don’t choose preferred technologies; they choose food that tastes good, performs reliably and offers value.

Delivering those expectations consistently. and at commercial scale. is where the next challenge begins. Product performance alone isn’t enough; manufacturers also need production systems that can translate promising formulations into viable commercial products.

Precision fermentation is proving that it addresses the attributes that determine whether consumers come back for a second purchase, including flavour authenticity, texture fidelity and functional performance, but commercial success ultimately depends on the ability to scale production reliably and cost-effectively.

As more manufacturers integrate fermentation-derived ingredients into plant-based formulations, attention is increasingly shifting towards process development, scale-up and the generation of robust technical data needed to support the move from proof-of-concept to commercial deployment and market adoption.

From a manufacturing perspective, this integrated model offers several advantages. It supports incremental reformulation: rather than redesigning products from first principles, manufacturers can introduce functional ingredients into existing formulations to address specific performance limitations, reducing time-to-market and lowering development risk.

It also maintains compatibility with existing processing infrastructure. Because fermentation-derived ingredients are typically used at low inclusion rates, they can often be incorporated without significant changes to production lines or processing conditions. And it enables more efficient cost-in-use optimisation. While some precision fermentation ingredients remain relatively high-cost on a per-kilogram basis, their targeted application means that overall formulation economics can remain competitive when evaluated at the product level. Together, these factors make precision fermentation particularly suited to B2B ingredient integration, rather than wholesale category disruption.

From category competition to ingredient convergence

Reframing precision fermentation as an enabling technology, rather than a competing category, helps clarify where the industry is heading. The future is unlikely to be defined by ‘plant-based versus fermentation.’ Instead, it will be built on hybrid systems that combine the strengths of both. In practice, that future is already here, with burgers that taste more like beef, cheeses that melt more convincingly and baked goods that perform as expected.

Precision fermentation may remain largely behind the scenes, but its impact will be felt where it matters most: formulation, processing and manufacturing performance. As precision fermentation becomes more embedded within broader food systems, the infrastructure needed to move innovations from formulation into manufacture will become increasingly important.