Environmental, social and governance (ESG) investments have become increasingly popular over the past few years. This is great news for ESG stocks as a whole. But as a key part of this growing conscientiousness, plant-based food stocks in particular stand to benefit.

While vegetarian options have been around for decades, plant-based meat and plant-based dairy alternatives have started to gain popularity. Companies like Beyond Meat (NASDAQ:BYND), Oatly (NASDAQ:OTLY) and Tyson Foods (NYSE:TSN) continue to churn out new-and-improved products. In fact, the vegan food market is growing rapidly, with estimates indicating it will reach $31.4 billion by 2026.

Not only are plant-based foods on the rise, but vegetable producers are thriving, as well. For instance, fruits and vegetable producers like Calavo Growers (NASDAQ:CVGW) have experienced great success in the past decade. (Shares of Calavo Growers tripled between 2011 and 2020).

The Covid-19 pandemic is also fueling this dietary trend. This is partially due to supply chain issues, especially with meat. At the onset of the pandemic all meat prices rose, with beef and veal prices rising 17.6% in September 2020. Additionally, with the Centers for Disease Control and Prevention informing the public that a healthy diet will strengthen immune systems, more people turned to plant-based diets, taking advantage of the new plant-based products coming out.

As promising as the future of plant-based food stocks may be, investors seeking pure vegan stocks might struggle. The key here lies in the definition of veganism. Vegans object to using animal products of any kind, but plant-based followers may only apply it to their food, or may only eat mostly plant-based items with some exceptions. As such, it can be difficult to find vegan stocks, but there are plant-based companies, like Impossible Foods, that produce food products to help enable the vegan lifestyle.

With this quick overview aside, let’s get into the nitty gritty of what you might expect from plant-based food stocks in the years ahead.

Plant-Based Food Stocks: Catalysts for the Cattle-less

The Covid-19 pandemic highlighted the fragility of the human immune system, which in turn, was a powerful catalyst for vegan and plant-based food stocks. While there is no diet that is proven to combat Covid-19, Medical News Today notes that: “plant-based diets can also decrease a person’s risk of obesity and chronic diseases. These are conditions that tend to worsen the outcome of COVID-19.” World Health Organization (WHO) guidance also suggested limiting meat consumption. They advised for people to limit “red meat consumption to 1–2 times a week, and poultry to 2–3 times per week.”

People with higher levels of certain vitamins and minerals found in plants could be more resilient to Covid-19. Therefore, people switching from less vitamin and mineral-rich diets to a more plant-based or vegan diet could bolster their immune system. Another plus to vegan or plant-based diets are the amount of antioxidants consumed. Antioxidants can help combat free-radicals and oxidative stress, which is linked to respiratory disease and others.

While this sounds like great news for people in general, it’s also wonderful news for plant-based food stocks. As more people are encouraged to adopt healthier diets, companies that produce plant-based products should see an increased demand for their products. In fact, WebMD reports that “Plant-based food sales were up 27% in 2020, topping $7 billion.”

Also noted by Oxford Academic, “the demand for the functional foods which contain bioactive ingredients increased.” This bodes extremely well for plant-based stocks as it gives them a place in the market to fill. The demand for frozen vegetables also rose by 52% the week the pandemic was announced. Further into the pandemic, consumer trends toward healthier options showed more clearly, with 43% of consumers consuming more fruit, and 42% consuming more vegetables. All of this data means more opportunity for vegetable and plant-based food stocks.

The Covid-19 pandemic also caused significant supply chain issues, which have, in turn, influenced the demand for plant-based products.

There are five stages in the food supply chain: “agricultural production, postharvest handling, processing, distribution/retail/service, and consumption.” Because of government-imposed transportation restrictions to help ease the spread of Covid-19, transporting food became an issue. Borders and territories were closed by governments, making it difficult to deliver food shipments. Additionally, labor shortages caused disruption in livestock production (meat), horticulture, planting, harvesting and the processing of crops.

The labor shortage was particularly hard to address, as food-processing facilities are “potential hotbeds for outbreak.” It is hard to social distance in an environment where workers need to stand side-by-side. The loud environment also means people need to talk loudly or shout. This releases more droplets into the air, which is how viruses spread. Employees also tend to car-pool together or use public transportation, which was deemed dangerous during the pandemic.

The entire food industry was under threat; however, meat producers were hit particularly hard, with plant-based food companies evading many of these issues thanks to their unique supply chain. In fact, at the start of the pandemic, “grocery store sales of faux meats rose by 264 percent,” while the cost of real meat climbed because of supply issues.

No Meat on This Bone: Plant-Based Food Stock Headwinds

While the catalysts for plant-based stocks to soar are strong, the industry isn’t without its challenges.

For example, a healthier lifestyle and a plant-based diet can be hard to maintain and do well. For one, it can be a challenge to ensure you are eating enough protein. Proteins are made up of amino acids found in dairy, fish, eggs, meat, legumes, grains and nuts. A plant-based diet would generally exclude the first four items, making it harder to intake protein.

There is also “potential for some nutrient deficiencies including calcium, iron, and B12.” To avoid these issues, one must plan and meal-prep, which can take a lot of time and thought. In a world where many people are constantly busy, some don’t have the time to carefully plan out diets and meals.

That’s where many plant-based food companies come into play and try to offer convenient solutions. However, whether or not their “solutions” are actually healthier is questionable.

To break down the components of plant-based meat further, let’s take Burger King’s Whopper, for example. Their Impossible Whopper is: “629 calories, 25 grams protein, 58 grams carbs (4 grams fiber), and 34 grams fat. By comparison, the traditional beef Whopper … [is] 660 calories, 28 grams protein, 49 grams carbs (2 grams fiber), and 40 grams fat.” The difference in numbers is fairly small, with the Impossible Whopper slimly beating the beef Whopper, except for in the amount of carbs. That being said, if you want to quit meat for health reasons, these numbers are slim, which isn’t great for plant-based food stocks.

We should expect the scrutiny around plant-based food products and their viability as healthy alternatives to continue.

Another downside to a plant-based diet can be the cost. For example, 16 ounces of Beyond Beef, a plant-based replica of ground beef, costs between $7.79 and $9.99. A bit on the cheaper side, Impossible Food’s ground beef replica costs $6.99 for 16 ounces. However, 16 ounces of ground beef can start at a price of $3.99 to $8.99, depending on what type of beef and if it is organic or not. Depending on your favorite type of plant-based “meat,” it is currently cheaper to buy and make a beef burger than it is to make a plant-based burger.

In terms of eating cheaper and healthier, your best bet would be sticking with vegetarian items versus plant-based “meats.” This veggie burger recipe only costs 47 cents per serving; way cheaper than plant-based “meats.” While this is bad news for some plant-based food stocks, it could still be good news for fruits and vegetable producers.

Top Plant-Based Stocks to Watch

Caroline Rodrigues is a web editor for InvestorPlace.com. On the date of publication, they did not hold any position (either directly or indirectly) in any of the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.