When David Protein began selling its bars in late 2024, the whey protein used in the products cost $7 per pound. Today, that figure has nearly doubled to $12 per pound.<\/p>\n
Peter Rahal, David\u2019s founder and CEO, said a wave of demand for high protein foods\u2014dubbed \u201cproteinmaxxing<\/a>\u201d is behind the skyrocketing prices.<\/p>\n \u201cI don\u2019t see it slowing down necessarily because people are trying to get more protein to look better,\u201d Rahal told Fortune. \u201cYou\u2019re seeing protein capitalism at play.\u201d<\/p>\n Protein-packed products, from pasta to cereal to popcorn, have made their way to store shelves amid a surge in protein popularity. Many of these products source the macronutrient from whey, a byproduct of the cheesemaking process. But as demand for these products explodes, companies are facing a supply shortage of this key ingredient and are faced with soaring prices\u2014and difficult decisions to make.<\/p>\n The rise of proteinmaxxing<\/strong><\/p>\n The recent obsession with protein isn\u2019t fueled by bodybuilding or even a diet fad, but rather by the increasing use of GLP-1 weight loss drugs<\/a>, which can suppress appetite and require users to pivot to nutrient-dense foods, such as those high in protein, to avoid muscle loss. About 10% of the U.S. population<\/a> has taken a GLP-1 drug, and the increase in protein intake directly helps GLP-1 users preserve muscle. The Department of Health and Human Services has also revised its Dietary Guidelines for Americans<\/a>, putting an emphasis on protein-heavy foods, such as red meat and full-fat dairy.<\/p>\n \u201cWe have a tremendous amount of demand that\u2019s come into the market here in the last few years,\u201d Kathleen Wolfley, vice president of agriculture consultancy Ever.Ag Insights, told Fortune. \u201cI\u2019ll say that a lot of that demand is probably being driven by a push towards wellness and protein being one of those key wellness focal points.\u201d<\/p>\n For many companies, whey is the gold standard for protein-packed snack foods. Compared to protein isolates from milk or plant-based sources, whey tastes the best, Rahal said, and it offers the best texture in protein bars, which can often develop the reputation of being chalky or hard.<\/p>\n But the strong preference for whey protein has come at a literal cost. According to data<\/a> from the U.S. Department of Agriculture, the cost of high-protein whey concentrate has jumped 40% over the past few months, and some suppliers have already sold out of the product.<\/p>\n Companies feeling the pinch<\/strong><\/p>\n For food companies, switching to another supplier or type of protein isn\u2019t a superficial switch. HelloAmino, a Canadian company selling gluten-free boxed cake and beverage mixes, tried to switch its whey protein supplier after its previous distributor gave it a five-week backorder, then completely cut the company off.<\/p>\n HelloAmino founder Aelie Swift told Fortune a new supplier provided an ingredient that was slightly different, but completely changed the composition of its products.<\/p>\n \u201cIt was complete sawdust,\u201d she said of a pancake mix. \u201cEverything turned out dry and inedible.\u201d<\/p>\n Swift spent months reformulating mixes to accommodate different types of protein isolate or simply just less protein. She\u2019s had success with some products, but has had to ditch some inventory altogether.<\/p>\n \u00a0\u201cTo say it\u2019s had an impact on our business is really an understatement,\u201d Swift said.<\/p>\n To make matters more challenging, the proteinmaxxing trend has completely saturated the market with new consumer brands trying to enter the space by putting protein in snack foods beyond bars and powders. Swift claims to be among the first in the protein baking space, but said how crowded the space is has made her rethink HelloAmino\u2019s value proposition to be oriented more around wellness than protein, and she sees other small businesses having to either adapt or shutter.<\/p>\n Big businesses don\u2019t have this same problem, Swift said. If anything, she argued, they\u2019ve benefitted at the expense of smaller brands. When Starbucks<\/a> launched protein beverages<\/a> late last year, Swift said she noticed greater strain on supply, exemplifying the outsized impact just one company can have on the larger market.<\/p>\n \u201cAll of a sudden, we had back orders we\u2019ve never seen before,\u201d she said. Starbucks did not respond to Fortune\u2019s request for comment.<\/p>\n Finding a systemic solution for the shortage is challenging. Wolfley said investments have been poured into increasing cheese production or whey capacity in order to alleviate the shortage. But dairy farms can\u2019t ratchet up production too much: Because whey is a byproduct of cheese, it is constrained by demand for cheese, which is rising<\/a>, but expected to slow as consumer preferences change, especially in an inflationary environment.<\/p>\n \u201cJust producing more whey without producing more cheese, and that would destroy the cheese industry,\u201d Swift said. \u201cIt\u2019s really unlike any shortage that you normally see in the food sector, in my opinion, because of that fact. It\u2019s not an easy one to solve.\u201d<\/p>\n