[196 Pages Report] According to MarketsandMarkets, the dairy alternatives market is estimated to be valued at USD 22.6 billion in 2020 and is projected to reach USD 40.6 billion by 2026, recording a CAGR of 10.3%. It is witnessing significant growth due to increasing instances of lactose allergies, changing consumer lifestyles, and growing health awareness among consumers. Consumers are increasingly adopting a vegan diet contributing to the growth of the dairy alternatives market. The Asia Pacific region will dominate the market due to the agricultural production base for plant-based sources. Several consumers perceive a vegan diet to be healthy and prefer consuming dairy alternatives such as soy milk, almond milk, rice milk, and other plant-based milk as a substitute for dairy milk. Vegan diet followers and adopters of a healthy diet are the primary consumers of dairy alternatives that have propelled the market growth. Rising awareness among consumers about the benefits offered by a vegan diet is one of the major factors propelling the demand for dairy alternative products across the world. A substantial increase in the vegan population has been seen in many major economies, such as the US and the UK. Consumers in developed economies accept plant-based milk since dairy alternatives provide energy, improve health, help in weight management, and increase the palatability of food. For instance, in 2016, according to data suggested by the Vegan Society survey, the number of the vegan population rose by 360% over the last decade.
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The increasing number of lactose-intolerant and dairy-allergic consumers have accelerated the growth of the dairy alternatives market. Lactose is the major carbohydrate in milk and other dairy foods such as ice cream, cheese, and yogurt. The symptoms of lactose intolerance among individuals include abdominal pain, diarrhea, nausea, gut distension, flatulence, and constipation. The increasing number of these allergies promotes the consumption of dairy alternatives as consumers are more aware of healthy eating habits. Consequently, the demand for a variety of dairy alternatives such as plant-based non-dairy products such as milk, ice creams, creamers, and cheese, among others, is gaining importance among these consumers. According to the American Gastroenterological Association, cow’s milk is a major cause of food allergies among infants and children. The increasing number of lactose-intolerant and dairy-allergic consumers have accelerated the growth of the dairy alternatives market. The rising awareness about healthy eating habits influences consumers. Several infants and adults suffer from milk allergies that result in an adverse immune reaction after ingestion of animal milk. The increasing number of these allergies promotes the consumption of dairy alternatives. The demand for a variety of dairy alternatives such as rice milk, soy milk, and oat milk is increasing.
One of the major factors restraining the growth of the dairy alternatives market is allergies associated with the plant-based sources used to manufacture dairy alternative products. Although soybeans are rich in nutrient content, the presence of anti-nutritional components in soy could cause allergies. A soy allergy occurs when the human immune system mistakes the harmless proteins found in soy as harmful and produces antibodies to combat them. Similarly, tree nuts such as almonds are one of the ingredients that cause allergies. Owing to this, these individuals have to avoid almond-based products such as almond milk and other non-dairy products made from almonds. The price of dairy alternatives, on the other hand, depends on the supply of raw materials, which is why there are price fluctuations. Oat milk and several other dairy alternatives face the problem of raw material unavailability, because of which prices increase. This price volatility stands as one of the biggest limitations for growth in dairy alternative beverage sales.
Organic food & beverages have the potential to change the business landscape in the overall dairy alternatives market. Changing consumer preferences have been oriented toward healthy food & beverages; this is attributed to a rise in awareness about the functional health benefits in the consumption of organic food products. Clean-label food & beverages have been attracting consumers globally, resulting in a rise in demand for organic ingredients. Developing countries such as China and India are projected to witness a strong surge in demand from the supply side for organic food ingredients during the forecast period.
The demand for dairy alternative food & beverage products is high in the developed markets of the US and Canada. Consumer preference for vegan products is rapidly rising as marketing campaigns are planned to highlight their use and health benefit claims. Developing countries such as China and Australia are expected to experience a sharp upsurge in demand for dairy alternatives in the future. This demand may be driven by an increase in consumer preference for vegan diets.
Though most dairy alternatives are similar to dairy milk in terms of texture and taste, the price of dairy milk is relatively low than that of its alternatives. The price of dairy alternatives depends on the supply of raw materials; owing to this, there are price fluctuations. Oat milk and several other dairy alternatives face the problem of raw material unavailability, because of which prices increase. This price volatility stands as one of the biggest limitations for growth in dairy alternative product sales.
Rising deforestation in developing countries results in the scarcity of raw materials for dairy alternatives such as soy, almond, and rice. Further, extremely cold climatic conditions in countries such as the UK, France, and Spain hamper the production of agricultural produce. Soy milk is produced from whole soybeans or full-fat soy flour; almond milk is made from ground almonds that are free from lactose and cholesterol; oat milk is lactose-free milk obtained naturally from oats, other grains, and beans. The unavailability of these agricultural raw materials restricts the production of alternative dairy beverages by European manufacturers.
Based on source, almond is projected to be the fastest-growing segment in the market. The growth of almond-based dairy alternatives is attributed to factors such as high nutritional content, easy availability of raw materials, and increased popularity in the market. Almond offers a nutty flavor, and it can be consumed by vegans. According to the USDA, 1 cup (262 g) of almond milk comprises just 39 calories, 1 g of protein, and 2.5 g of fat. Almond-based dairy alternatives are also beneficial for calorie-conscious individuals as they are free from cholesterol and saturated fats and available in varieties ranging from plain sweetened, plain unsweetened, and flavored-sweetened to flavored unsweetened.
Based on the distribution channel, online stores will be the fastest-growing segment in the dairy alternatives market. Online stores are easily accessible and are cost-effective. They also offer consumers alternative dairy products at discounted prices as compared to traditional retail prices.
Many key players have started offering their products for sale through online channels. This helps consumers in terms of placing an order as well as getting the delivery. Several one-stop shops have put themselves on the web to ease the purchasing process for the consumers. These online retails also offer a variety of options for a particular dairy-free food product at discounted rates compared to traditional retail prices to attract more customers. The usage of online services has also increased in developed as well as developing markets due to faster accessibility and cost-effectiveness.
By application, the dairy alternatives market is segmented into milk, yogurt, ice creams, cheese, and creamers. The milk segment dominated the market, owing to rising health concerns relates to lactose intolerance and the hectic lifestyles of the consumers. Plant-based milk products are highly nutritious and are available in various flavors. Since health and convenience are prioritized by consumers while making a beverage choice, companies have diversified their beverage offerings with products containing almond milk, coconut milk, and soymilk, along with other non-dairy ingredients and alternatives derived from hemp, oats, or flax. Consumers are also inclined toward flavored milk alternatives with vanilla or chocolate flavors, driving companies to tap the opportunity by introducing dairy-free products in different flavors tailored in accordance with consumer requirements.
The global dairy alternatives market is dominated by the Asia Pacific region due to the changing lifestyles of consumers and the increase in consumption of clean label products. Consumers are also more aware of their health and wellness, which is further fueling the demand for dairy alternatives in the region.
The Asia Pacific dairy alternatives market is also driven by large economies such as China, Japan, and Australia. The overall investment in the region has increased substantially over the past few years, especially in China. Japan, Australia, China, and India are the major countries covered for study in this report. Some key market players in this region are Sanitarium Health & Wellbeing Company (Australia), Freedom Foods Group Ltd. (Australia), Vitasoy International Holdings Limited (Hong Kong), and Pureharvest (Australia). The dairy alternatives industry in the Asia Pacific region is growing, owing to the changing lifestyles of customers. The dairy alternatives market in this region is currently undergoing a dramatic transformation in response to rapid urbanization, diet diversification, and the liberalization of foreign direct investment in the food sector.
The Hain Celestial (US), Blue Diamond Growers (US), SunOpta (Canada), Sanitarium Health and Wellbeing Company (Australia), Danone (France), Freedom Foods Group (Australia), Earth’s Own Food Company (Canada), Triballat Noyal (France), Valsoia S.p.A (Italy), Panos Brands (US), Melt Organic (US), Oatly (Sweden), Living Harvest Foods (US), Ripple Foods (US), Kite Hill (US), Califia Farms (US), Hudson River Foods Inc. (US), Daiya Foods Inc. (Canada), Pureharvest (Australia), Yoconut Dairy Free (US), and Yumbutter (US).
Which are the major sources considered in this study, and which segments are projected to have a promising growth rate in the future?
Soy is estimated to account for the dominant share in the dairy alternatives market, followed by almond and coconut. However, almond is projected to experiencing the highest growth rate in the next five years, as it has many characteristics such as high nutritional content and easy availability of raw material. It is perceived as a clean-label ingredient and has the added benefits of being soy-free, gluten-free, and lactose-free.
I am interested in the Asia Pacific market for the soy, almond, coconut, rice, oats, and hemp segment. Is the customization available for the same? What would all information be included in the same?
Yes, the customization for sources in the Asia Pacific market can be provided on various aspects, including market size, forecast, market dynamics, company profiles, and competitive landscape. Exclusive insights on below Asia Pacific countries will be provided:
Also, you can let us know if there are any other countries of your interest.
What are some of the drivers fueling the growth of the dairy alternatives market?
The global dairy alternatives market is characterized by the following drivers:
Several consumers perceive a vegan diet to be healthy and prefer consuming dairy alternatives such as soy milk, almond milk, rice milk, and other plant-based milk as a substitute. Vegan diet followers and adopters of a healthy diet are the primary consumers of dairy alternatives that have propelled the market growth. The rise in awareness among consumers about the benefits offered by a vegan diet is one of the major factors propelling the demand for dairy alternatives across the world. A substantial increase in the vegan population has been seen in many major economies, such as the US and the UK.
Nutritional benefits, such as reduced cholesterol levels, improved cardiovascular health, and diabetes control, of plant-based dairy alternatives, have led to an increase in their consumption. Soy milk is widely consumed as a rich source of omega-3 fatty acids, protein, and fiber. It contains isoflavones that are known to have anti-estrogenic and anticancer properties. Almond milk, rich in calcium and vitamin E, is recommended for both skin and bone health. It contains about one-third the calories of 2% cow’s milk. Consumers opt for coconut milk as it contains lauric acid. The low carb and low-fat varieties of dairy alternatives help reduce fat. Such nutritional benefits contribute to the growth of the dairy alternatives market.
I am interested in understanding the research methodology on how you arrived at the market size and segmental splits before making a purchase decision. Can you provide me with an explanation on the same?
Yes, a detailed explanation of the research methodology can be provided over a scheduled call; it will also enable us to explain all your queries in detail. For a brief overview and knowledge: Multiple approaches have been adopted to understand the holistic view of this market, including:
What kind of information is provided in the competitive landscape section?
For the list of below-mentioned players, company profiles provide insights such as a business overview covering information on the company’s business segments, financials, geographic presence and revenue mix, and business revenue mix. The company profiles section also provides information on product offerings, key developments associated with the company, SWOT analysis, and MnM view to elaborate analyst view on the company. Some of the key players in the market include The Hain Celestial (US), Blue Diamond Growers (US), SunOpta (Canada), Sanitarium Health and Wellbeing Company (Australia), Danone (France), and Freedom Foods Group (Australia). .
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The study involved four major activities in estimating the dairy alternatives market size. Exhaustive secondary research was conducted to collect information on the market, peer market, and parent market. The next step was to validate these findings, assumptions, and sizing with industry experts across the value chain through primary research. Both the top-down and bottom-up approaches were employed to estimate the complete market size. Thereafter, market breakdown and data triangulation were used to estimate the market size of segments and sub-segments.
In the secondary research process, various secondary sources, such as Hoovers, Bloomberg BusinessWeek, and Dun & Bradstreet, were referred to, to identify and collect information for this study. These secondary sources included annual reports, press releases & investor presentations of companies, white papers, certified publications, articles by recognized authors, gold & silver standard websites, regulatory bodies, trade directories, and databases.
The market comprises several stakeholders, such as raw material suppliers, processors, end-product manufacturers, and regulatory organizations in the supply chain. The demand side of the market is characterized by the presence of global and regional processed food manufacturers, food, beverage, and nutraceutical companies, commercial research and development institutions, and government & research organizations. The supply side is characterized by the presence of key CEOs and vice presidents, dairy alternative product manufacturers, plant-based milk manufacturers and suppliers, marketing directors, product innovation directors and related key executives from manufacturing companies and organizations operating in the market. Various primary sources from both the supply and demand sides of the market were interviewed to obtain qualitative and quantitative information.
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Both the top-down and bottom-up approaches were used to estimate and validate the total size of the dairy alternatives market. These methods were also used extensively to estimate the size of various subsegments in the market. The research methodology used to estimate the market size include the following:
After arriving at the overall market size from the estimation process described above, the total market was split into several segments. To complete the overall market engineering process and arrive at the exact statistics for all segments, the data triangulation and market breakdown procedures were employed, wherever applicable. The data was triangulated by studying various factors and trends from both the demand and supply sides. In addition, the market size was validated using both top-down and bottom-up approaches. It was then verified through primary interviews. Hence, three approaches were adopted—top-down approach, bottom-up approach, and the one involving expert interviews. Only when the values arrived at from the three points matches, the data is assumed to be correct.
Based on the given market data, MarketsandMarkets offers customizations in the reports according to client-specific requirements. The available customization options are as follows:
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