The recently published global forecast for the dairy alternatives industry by the research firm MarketsandMarkets projects strong growth through 2020, furthering evidence of consumer preferences trending toward a plant-based diet. Here we summarize the key findings of the study.
Overall Global Projections:
- The dairy alternatives market is projected to grow globally from $8.2 billion in 2014 to $19.5 billion in 2020, with 15.5% growth from 2015-2020.
- The Asia-Pacific region enjoys the largest market share globally with 42.7% in 2014, and the highest projected growth of any region with 19.9% through 2020
- Soymilk is expected to be largest segment at $13.6 billion by 2020
- Almond milk will have fastest growth rate through 2020 at 16%
- Plain unsweetened dominates the flavor profiles, valued at $2.2 billion with projected growth of 15.9% through 2020
The study cites several market factors driving the growth:
- Growing consumer health awareness
- Increasing global vegan population
- The nutritional benefits of dairy alternatives compared to dairy products
- Increasing consumer rates of lactose intolerance and dairy allergies
- Increased demand for fortified dairy free food and beverage products
The US market is considered a developed market for dairy alternatives but still harbors significant growth opportunity in key categories such as convenience foods:
- The US market is projected to grow at 13.2% through 2020 from $2.4 billion to $4.4 billion
- The US has the largest market share globally for bakery, confectionary, and convenience foods, and therefore presents a major opportunity for growth
Additional milk alternatives, outside of soy and almond milk, continue to expand offerings to consumers, including:
- Coconut milk and cashew milk are the closest in texture to whole milk
- Coconut milk contains fiber and iron, and is higher in saturated fat and calories than cow’s milk
- Hemp milk is high in protein and minerals, and contains omega-3 and omega-6 fatty acids and other nutrients, but lacks calcium
- Oat milk and hazelnut milk are high in fiber
The study did note some challenges pertinent to the growth of the dairy alternatives industry. The most notable factors include:
- High market competition, as new companies enter the market to take advantage of growing opportunity
- Dairy alternatives are consistently costlier than dairy milk, though consumers are often willing to pay more due to the health benefits
- Fluctuations in raw materials and scarcity of raw materials provide a challenge in production and pricing of products
In spite of the noted challenges, numerous opportunities that may influence growth of the industry abound:
- Diverse and creative consumer education by food companies will lead to increased demand
- Correct positioning in the market as industry leaders cement and expand distribution worldwide
- Better technology, output, and efficiency will lead to fewer price and production fluctuations
- New product introductions, including different flavors and alternative products to yogurt, cheese, and ice cream, will drive increasing consumer demand
(Many thanks to volunteer Suzannah Koilpillai for drafting and posting this summary for us.)