Dairy Alternatives Market Size, Share & Trends Report

Dairy Alternatives Market Size, Share & Trends Analysis Report By Source (Soy, Almond), By Product (Milk, Ice Cream), By Distribution Channel (Supermarket & Hypermarkets, Online Retail), And Segment Forecasts, 2021 - 2028

  • Published Date: Apr, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-1-68038-070-5
  • Format: Electronic (PDF)
  • Historical Data: 2017 - 2019
  • Number of Pages: 165

Report Overview

The global dairy alternatives market size was valued at USD 20.50 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 12.5% from 2021 to 2028. The market is gaining momentum and witnessing a high demand owing to the shift in consumer eating patterns and change in diet trends. The increasing occurrences of milk allergies and lactose intolerance cases are expected to further drive the demand for dairy alternatives over the forecast period. Numerous food and beverage products are thus making use of dairy alternatives to appeal to the growing consumer base that is opting for plant-based and other dairy alternatives. Soy milk is expected to gain popularity in the U.S. among the elderly and female consumers as it contains isoflavones, which are said to reduce the risk of heart diseases and breast cancer. Soy also contains phytoestrogen, which functions similarly to the female hormone estrogen. Drinking soy milk is popular as an alternative therapy among women to increase estrogen levels, which is further expected to drive the market.

U.S. dairy alternative market size, by source, 2017 - 2028 (USD Million)

Almond milk is becoming increasingly popular among youth that is health-conscious and follow diets, such as ketogenic diet and vegan diet. Almond milk is a rich substitute of dairy due to its high lipids, fiber, and protein content, and is expected to witness high adoption among consumers as well as end-use industries. Moreover, almond milk helps in regulating blood pressure and further offers benefits to the skin, kidney, and heart. It is increasingly being consumed in the diet as a means for the prevention of the related diseases.

The demand for unsweetened dairy alternatives is increasing as consumers are seeking to avoid additional calories brought in by the added sugar. Consumers are also opting for dairy alternatives as a means to cut back on calories consumed as dairy products generally contain a high number of calories. Consumers looking to lose weight have been increasingly substituting cow or buffalo milk with soy or almond milk. This, in turn, is expected to aid the growth of the market as fitness-savvy consumers are increasing across the globe.

Concerns over hormones, pesticides, and antibiotics are driving the demand for the product. The residues of the aforementioned substances are claimed to be harmful for consumption, especially by pregnant women. The presence of hormones in dairy products consumed by humans is expected to provoke and initiate endometrial, prostate, and breast cancer. Dairy alternatives have posed as a safe option instead of dairy products as they are natural by source and are extracted in a natural way. The superior benefits offered by the dairy alternatives are expected to further ascend the market growth over the forecast period.

Source Insights

Soy led the market in 2020 and accounted for more than 35.0% share of the global revenue. Soy milk is rich in nutrients and has a high protein content compared to other dairy alternatives, which is expected to drive the segment over the forecast period. Soy milk has been traditionally used in the Asia Pacific region over centuries and is a part of numerous recipes, which is expected to keep the product demand consistently stable over the forecast period. It is used for the purpose of lowering obesity and blood cholesterol levels. It also helps in reducing the risk of several postmenopausal issues, along with improving cardiovascular health, which, in turn, has made it a preferred supplement.

Almond milk held the second-largest share in 2020. It is rich in vitamin B, which helps raise the basal metabolic rate of the body, enabling it to burn fats and calories more efficiently. Increasing demand for almond milk due to these nutritional benefits is likely to contribute to the segment growth.

Almond milk has essential minerals such as iron, magnesium, phosphorous, zinc, and copper that help in controlling blood pressure, improving blood oxygenation, and providing protection to the body against diseases. In addition, almond milk is rich in vitamin E and manganese, making it a more powerful drink for improving skin quality and protecting against cancer.

Increasing consumer preference for plant-based products, coupled with an ease of raw material availability, is a significant factor driving the market. Moreover, the rising demand for rice milk to manufacture various food and beverage items, such as ice creams, snacks, and beverages, is expected to drive the demand for the product over the forecast period.

Rice milk is made with white or brown rice and is usually unsweetened, however, it has more carbohydrates and is therefore fortified with iron, vitamin D, and vitamin B12. The organic form of rice milk in the market is gaining momentum over the conventional product even though it is priced at a premium. The high price is because of the moderately high production and distribution overheads as well as the willingness of the consumers to pay more for organic products as they observe them being free from preservatives. This is also anticipated to be one of the major drivers for the source demand.

Product Insights

The milk-based dairy alternatives product segment led the market and accounted for a revenue share of more than 67.0% in 2020. The increasing old age population has resulted in people preferring milk-based dairy alternatives in Europe. However, growing health concerns over soymilk, especially for breast cancer survivors, are likely to hamper the market growth. In Europe, increasing demand for low-calorie content food, coupled with the rising popularity of plant-based nutritional products, is likely to augment the demand for the product over the next eight years.

The milk product segment includes various new and innovative beverage options with dairy alternatives as the base ingredient. The manufacturers of beverages are introducing new products for higher market capitalization. The increasing demand among consumers for varied beverage options has resulted in varied options of flavored beverages consisting of dairy alternatives. The flavored beverages also appeal to lactose-intolerant consumers who are looking for a variety of milk-based dairy alternative beverages.

The growing demand for dairy alternatives-based cheese products, such as soy and almond-based cream cheese, sour creams, and regular cheese, is expected to propel the demand for dairy alternative products over the forecast period. Consumers who are lactose intolerant and have allergies to milk products are switching over to various cheeses made from almond and soy, which drives the market.

Market penetration of dairy alternatives-based cheese products is likely to grow over the forecast period on account of the presence of companies like Galaxy Nutritional Foods, Tofutti, and Trader Joe’s that provide the famous dairy-free soy cream cheeses. In addition, Daiya Foods Inc. makes a variety of cheeses, which are nut, gluten, dairy, and soy-free, making them a great choice for those with allergies to these ingredients.

Distribution Channel Insights

Supermarket and hypermarkets led the market and accounted for more than 40.0% share of the global revenue in the year 2020. Supermarkets and hypermarkets are large-sized retail outlets, which usually offer multiple categories of retail products under one roof. Supermarkets are usually located near a residential area in order to be accessible to the customers. However, due to the unavailability of land near residential areas, most of the supermarket and hypermarket chains are opening their new stores outside the city.

In developed regions such as Europe and North America, the penetration of supermarkets and hypermarkets is higher than that in the developing regions. Besides, the presence of a large variety of dairy alternatives in one place and ease of buying contributed to the growth of supermarkets and hypermarkets as distribution channels in 2020.

Convenience stores usually offer lower discounts in comparison to hypermarket and supermarket and online stores owing to their low-volume procurement from manufacturers or suppliers. Besides, convenience stores mainly focus on everyday items, thus, the availability of limited shelf size restricts them from keeping an extensive assortment of dairy alternatives products.

Owing to the limited availability of dairy alternative brands in convenience stores, consumers mainly prefer other distribution channels, which, in turn, is expected to restrain the growth of this segment over the forecast period. However, convenience stores offer better traction for fresh milk as consumers usually prefer it for everyday use.

Regional Insights

Asia Pacific dominated the market and accounted for more than 44.0% share of the global revenue in 2020. Expanding population and rising disposable incomes in emerging countries, such as India, China, and Japan, are expected to augment the demand for the product in the Asia Pacific region. Increasing cases of lactose intolerance, coupled with the rising health issues associated with harmful additives used in dairy products, are anticipated to boost the demand for non-dairy products, such as soy milk, almond milk, rice milk, and other dairy alternatives.

North America is one of the major markets for dairy alternatives as a variety of dairy alternative products, such as ice cream and yogurt, are consumed on a large scale. Flavored milk accounts for over two-thirds of milk products sold in North American schools. Increasing consumer demand for sweetened flavored soy and almond milk is expected to be a key factor driving the dairy alternatives industry. Milk-based dairy alternatives are used for manufacturing various food items and desserts, which is expected to drive the industry over the forecast period in the North American region.

Global dairy alternative market share, by region, 2020 (%)

Despite dairy alternatives-based ice cream witnessing moderate demand in North America as compared to milk-based ice cream, the growth of this product category is expected to be much higher over the forecast period. As a result, the demand for dairy alternatives among ice cream manufacturers is anticipated to grow significantly over the forecast period.

The growing demand for plant-based products with high nutritional value is expected to drive the market over the forecast period. The increasing number of milk allergies and health-related issues associated with harmful additives used additionally in dairy products is expected to augment the demand for dairy alternative products, such as soymilk, almond milk, and rice milk.

The European market is expected to witness growth owing to the rising demand for healthy food and beverages in the region. Dairy alternative-based beverages are often consumed as alternatives to dairy beverages. Manufacturers are focusing on new product development, which includes soy juice mixes and fresh soy drinks.

Key Companies & Market Share Insights

New product development in the food and beverages industry to create alternatives for milk-based products is expected to remain a key success factor for the industry participants over the next few years. For instance, the brand Sofit by Hershey Trust Company is customized to appeal the Indian customers and is available in Kesar Pista flavor. Similar variations are observed across the companies that are developing products for further market penetration.

Most of the manufacturers of dairy alternatives are vertically integrated through established processes in the end-user phase in the value chain. Therefore, many manufacturers of dairy alternatives are manufacturing food products containing dairy alternatives as well as beverages that utilize alternatives, such as almond milk or soy milk. As the processes involved in the manufacturing of dairy alternatives do not require highly complex technology, it has become easier for the new entrants to penetrate the industry. This, in turn, has made the market highly competitive with moderate to high rivalry among competitors who are seeking to capitalize on the growing opportunities in dairy alternatives in the forecast period. Some prominent players in the global dairy alternatives market include:

  • The Hain Celestial Group, Inc.

  • SunOpta Inc.

  • Danone

  • Oatly

  • Vitasoy International Holdings Limited

  • DAIYA FOODS INC.

  • Melt Organic

  • Living Harvest Foods Inc.

  • Ripple Foods

  • Earth’s Own Food Company Inc.

  • ADM

  • The Whitewave Foods Company

  • Eden Foods, Inc.

  • Nutriops, S.L.

  • Freedom Foods Group Ltd.

  • Blue Diamond Growers

  • CP Kelco

  • Organic Valley Family of Farms

Dairy Alternatives Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 23.20 billion

Revenue forecast in 2028

USD 52.58 billion

Growth Rate

CAGR of 12.5% from 2021 to 2028

Base year for estimation

2020

Historical data

2017 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD million/billion and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Source, product, distribution channel, region

Regional scope

North America; Europe; Asia Pacific; Central & South America; Middle East & Africa

Country scope

U.S.; Canada; Mexico; Germany; U.K.; France; Italy; Spain; China; Japan; India; Australia; Brazil; South Africa

Key companies profiled

The Hain Celestial Group, Inc.; SunOpta Inc.; Danone; Oatly; Vitasoy International Holdings Limited; DAIYA FOODS INC.; Melt Organic; Living Harvest Foods Inc.; Ripple Foods; Earth’s Own Food Company Inc.

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Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2017 to 2028. For the purpose of this study, Grand View Research has segmented the global dairy alternatives market report on the basis of source, product, distribution channel, and region:

  • Source Outlook (Revenue, USD Million, 2017 - 2028)

    • Soy

    • Almond

    • Coconut

    • Rice

    • Oats

    • Others

  • Product Outlook (Revenue, USD Million, 2017 - 2028)

    • Milk

    • Yogurt

    • Ice Cream

    • Cheese

    • Creamer

    • Others

  • Distribution Channel Outlook (Revenue, USD Million, 2017 - 2028)

    • Supermarkets & Hypermarkets

    • Convenience Stores

    • Online Retail

    • Others

  • Regional Outlook (Revenue, USD Million, 2017 - 2028)

    • North America

      • U.S.

      • Canada

      • Mexico

    • Europe

      • Germany

      • U.K.

      • France

      • Italy

      • Spain

    • Asia Pacific

      • China

      • Japan

      • India

      • Australia

    • Central & South America (CSA)

      • Brazil

    • Middle East & Africa (MEA)

      • South Africa

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