Dairy Alternative Market Estimated to Witness High Growth Owing to Rise in Plant-based Lifestyles

by

The global dairy alternative market comprises of plant-based substitutes to animal-based dairy products including milk, yogurt, ice cream and cheese. Dairy alternatives such as soy milk, almond milk and oat milk provide similar nutrition to dairy milk along with various health benefits such as being lactose-free, low in calories and rich in vitamins, minerals and antioxidants. With increasing vegan and flexitarian population, dairy alternatives are gaining immense popularity as an ethical and sustainable choice. The growth of plant-based lifestyles and rising health concerns regarding dairy products have boosted the sales of dairy alternatives. The Global dairy alternative market is estimated to be valued at US$ 27.0 Bn in 2024 and is expected to exhibit a CAGR of 10.% over the forecast period of 2023 to 2030.

Key Takeaways

Key players operating in the dairy alternative market are Danone North America Public Benefit Corporation (US), The Hain Celestial Group, Inc. (US), Blue Diamond Growers (US), SunOpta (Canada), Sanitarium (New Zealand).

The market provides significant opportunities for new players to launch innovative products catering to various application segments and regional preferences. With surging investments in research and development, dairy alternatives are evolving to deliver enhanced nutritional profiles and creamier textures for a more indulgent experience.

Technological advancements such as development of protein-rich non-dairy milks and creation of mouthfeel similar to dairy cheese through fermentation processes are expanding the portfolio of plant-based dairy products.

Market drivers

The chief market driver is the rising global health-conscious population avoiding dairy owing to lactose intolerance, milk allergies as well as concerns over hormones, antibiotics used in cattle farming. Additionally, growing consumer awareness about environmental benefits of plant-based products is propelling the demand for sustainable dairy alternatives. Expanding retail distribution, lucrative promotion by brands and innovative product launches catering to on-the-go consumption are also boosting the market growth.

Current Challenges in Dairy Alternative Market

The dairy alternative market is still in a nascent stage compared to dairy market. Lack of consumer awareness about health benefits of plant-based dairy products is one of the primary challenges. Taste replication of dairy products is also a major challenge faced by manufacturers. Plant-based milk fails to fully mimic the texture and flavor of dairy milk. High production costs also affect the competitiveness of dairy alternative products. Established dairy lobby also poses a challenge by spreading misinformation about nutritional aspects of plant-based products.

SWOT Analysis

Strength: Growing health and environment consciousness is driving demand. Wide range of product innovation is helping address taste and flavor related issues.
Weakness: Limited product awareness and consumer preferences for dairy. High dependence on few plants for raw materials affect consistent supply.
Opportunity: Growing vegan and flexitarian population provides large addressable market. Potential to disrupt dairy category with advancements in food technology.
Threats: Resistance from dairy lobby groups. Competition from other food categories for shelf space may impact sales growth.

Geographical Regions of Concentration

North America currently dominates the global market, accounting for over 40% share in terms of value. Increased lactose intolerance, awareness about cardiovascular health and rise of veganism is driving significant growth in the region. Europe is another major market aided by plant-based milk’s popularity as a dairy alternative or complementary product.

Fastest Growing Geographical Region

Asia Pacific region is identified as the fastest growing market for dairy alternatives. Rising health consciousness, western influence, expanding middle class and urbanization are some key factors fueling demand. China represents the largest country market in the region due to changing diet and lifestyle of consumers. Recent regulatory approvals are also supporting regional companies enter international markets.