Cheap soybeans makes meat cheaper, but the production of meat is inherently inefficient. If the production of meat substitutes from soy could be made more efficient than the production of meat from soy, then de facto soy subsidies would disincentivize the consumption of meat.
That's why big chains like Burger King are moving to offer something in the space, not out of some ethical obligation about climate change or animal welfare.
The difference is that Impossible and its competitors are making a product competitive with real meat, with nearly the same flavor and texture properties. That's the game changer as it opens a huge market that eschew traditional veggie burgers.
I wouldn't say it's inherently inefficient. It's certainly inefficient to devote the products of cropland to raising animals. But there's a lot of scrub land out there that isn't suitable to intensive farming but where you can still graze cows.
So from an efficiency perspective we wouldn't want to entirely eliminate meat production, just drastically curtail it. But from an animal suffering perspective and a "methane is bad" perspective maybe we do want to eliminate it.
I wouldn't say subsidies would disincentivize meat. I would say they would incentivize both meat substitutes and meat, in an equally proportional amount.
They distort the prices of both soy products and meat, but not by equal proportions - the reduction depends on the distribution of cost components.
Say it takes 50 cents' worth of soy and 50 cents' worth of other expenses to produce $1 worth of beef, and it takes 90 cents' worth of soy and 10 cents' worth of other expenses to produce $1 worth of meat substitute. If the effective price of soy falls by 10% due to subsidies (and other costs remain the same), the cost of beef will fall by 5%, while the cost of meat substitute will fall by 9%.
The economics are skewed in the opposite direction, though. It takes many times more soy, water, and energy to produce $1 of beef vs $1 of substitute, because most of the soy you feed the cow is lost to heat and non-edible cow parts.
Once R&D costs of the meat substitute are accounted for, the marginal cost of production is lower. So at the same or slightly lower retail price than meat, an equivalent substitute's profit margin will be huge compared to meat. That's what these firms are after.
And in the long run, industrial scale meat production will take a big hit.
