Dairy Alternatives Market

Global Dairy Alternatives Market Size (2024 to 2029)

The global dairy alternatives market size was worth USD 13.89 billion in 2023 and is estimated to reach USD 35.09 billion by 2029 from USD 16.21 billion in 2024, registering a CAGR of 16.7% from 2024 to 2029.

Current Scenario of The Global Dairy Alternatives Market

Dairy alternatives offer better nutritional benefits compared to traditional dairy products like milk, butter, and cheese, allowing more customers to switch to these products. Contrary to popular belief, studies published in the Food and Nutrition Research Journal show that increased milk consumption does not improve bone density in adults. Dairy substitutes have fewer calories than low-fat milk. In addition, the calcium and potassium content of these dairy substitutes is higher than that of milk, which is one of the main causes of dairy consumption. The results of these studies were incorporated into the marketing strategies by the manufacturers of dairy substitutes to increase sales.

MARKET DRIVERS

The growing awareness among consumers of lactose intolerance and dairy allergies is primarily promoting the growth of the dairy alternatives market.

The rising prevalence of cardiovascular disease, obesity, diabetes, and gastrointestinal illness and increasing consumer spending on healthy foods, essential calories, nutrition, lactose, and sugar-free diets are bolstering the growth of the dairy alternatives market. Increased consumer interest in nutritional values, such as low in calories and high in protein and vitamins provided by milk substitutes or dairy alternatives, is likely to have a positive impact on the market. Soy milk contains various minerals such as iron, calcium, phosphorous, zinc, sodium, potassium, and magnesium. This product is very popular with heart patients because it lowers cholesterol levels. Also, soy milk contains the same amount of protein as milk and has fewer calories than whole milk and skim milk. Therefore, like soymilk consumption increases, overall industrial demand is expected to increase. A preliminary study of the company's performance on substitute dairy products showed that soy, rice, and almond milk yields were approximately 6% higher than conventional milk and milk yields, attracting the attention of startups and food companies.

The European dairy industry has become a market leader, especially in Western Europe. Due to the growing consumer demand for plant-derived dairy products, the global industry is supposed to grow at a significant rate. As consumer health awareness increases along with improving disposable incomes in countries such as Brazil, India, China, and Japan, consumption of soy milk, almond milk, coconut milk, and rice is assumed to increase during the outlook period. The growing interest in animal rights and environmental protection is raising the preference for veganism. It is presumed to lead the industry during the projection period.

Furthermore, government policies to improve the agricultural sector will have a positive impact on market growth by increasing the availability of raw materials and lowering prices. Changes in the supply of raw materials are suspected to be a primary concern for market growth. The raw materials used in the manufacture of milk substitutes are nuts and edible grains, and most of the production is used for direct consumption. As a result, the availability of raw materials can be a crucial factor affecting the industry.

MARKET RESTRAINTS

Though the demand for dairy alternatives like almond milk, soy milk, and others is constantly growing, some people are more likely to depend only on dairy products, which are high in protein and cost. Dairy alternative products are plant-based options, and the cost is very high when compared with dairy products, subsequently limiting the growth rate of the market. Except for people who are lactose intolerant, there is no other reason to stop consuming dairy products like cow milk. It is a fact that there is no harm in drinking animal-based milk as it is highly nutritious and cost-effective. Therefore, the demand for dairy alternatives is still at a slower pace in rural areas, which may impede the market's growth rate.

Some brand products of dairy alternatives may contain fewer micronutrients compared to dairy products, which is slowing down the market's growth rate. In addition, people suffering from celiac disease cannot intake oat milk and others even though they are gluten-free, which is likely to impede the growth rate of the dairy alternatives market. There is likely no evidence that plant-based dairy products have high advantages and nutritional value, which is also a factor that degrades the growth rate of the dairy alternatives market.

REPORT COVERAGE

SEGMENTAL ANALYSIS

Global Dairy Alternatives Market Analysis By Application

The milk segment is leading with the highest share of the dairy alternatives market. The availability of non-dairy products is gradually increasing with the reduced production rate of animal-based dairy products. This is eventually creating scope to depend on plant-based dairy products, especially in urban cities. People in developed and emerging countries are showing huge interest in the adoption of a variety of products that are produced from plant-based sources, which is gearing up the growth rate of the market. The growing interest in non-dairy milk products with various flavors like oats, almonds, soy, and cashews is lucratively amplifying the demand for dairy alternative products. In 2023, according to the Associated Chambers of Commerce and Industry of India, there are more than 300 unique products under 56 brands that are completely related to the plant-based alternatives to dairy products in India.

The yogurt segment is set to hit the highest CAGR by the end of 2029. Key strategies by companies to launch new varieties of plant-based derivatives to replace traditional dairy products are solely to propel the growth rate of the market during the forecast period. Yogurt is an essential product for fitness freaks as it consists of more fiber and less total sugar when compared with dairy yogurt. Therefore, the yogurt segment is attributed to having the fastest growth rate during the forecast period.

Ice creams segment is attributed to grow steadily throughout the forecast period. Ice cream is one of the favorite products for many of the people across the world. The ice creams that are made up of plant-based derivatives is more likely to attract the people who seeks to stay healthy by eating low calorie food products.

Global Dairy Alternatives Market Analysis By Distribution Channel

The supermarket segment is esteemed in holding a prominent share of the dairy alternatives market. There are many kinds of dairy alternative products that can be easily available in the nearest supermarkets in the cities. The growing prominence of shifting towards non-dairy products is ascribed to boosting the market's growth rate. Online stores are expected to have the fastest growth rate during the forecast period. Feasibility in purchasing products through online stores simply through a smartphone is leveling up the segment's growth rate. Quick adoption of advanced techniques in the food and beverage industry is the sole way to increase the market's growth rate. The high usage of smartphones is also ascribed to amplifying the online store's segment's growth rate.

REGIONAL ANALYSIS

North America is leading with the largest share of the dairy alternatives market owing to rising people's focus on eating only healthy food items. The need to eat high nutritional value food products is growing with the increasing risk factors due to various chronic diseases, which is outraging the demand for the shift towards dairy alternatives. According to the National Institutes of Health, more than 36% of Americans have lactose malabsorption, and these people cannot easily digest milk products due to the presence of lactose. The easy availability of unique and high-quality products in online stores is straightly prompting the growth rate of the market in developed countries like the US and Canada.

Asia Pacific dairy alternatives market is deemed to hit the highest CAGR by the end of 2029. India and China are the most populous countries in the world, and the demand to adopt dairy alternatives is growing at a faster rate. The decreased production rate of dairy milk in these countries substantially leverages the need for dairy alternatives. The launch of various unique products in favor of the consumer's preferences is another factor that escalates the market's growth rate. Also, rising support from government authorities for approving high-quality products based on consumer safety is likely to highlight the growth rate of the market in the coming years in India and China. Frequently changing lifestyles in urban areas in these countries account for the launching of a huge number of dairy alternative products that further propel the market's growth rate.

Europe is expected to lead the market share next to North America during the forecast period. According to recent survey reports, one in three Europeans is inclined to drink plant-based dairy alternatives drinks, especially for people aged 25-35. The UK and Spain are the largest consumers of dairy alternatives, and the market share in these countries has been increasing at a higher rate in the past few years. High disposable income, along with rapid urbanization, are also a few common attributes for the market to grow in these countries.

Latin America and Middle East & Africa are expected to have the steady growth pace during the forecast period due to the increasing prominence to avoid the unhealthy foods and completely focus on improving the health to prevent the obesity related issues.

RECENT HAPPENINGS IN THE MARKET

• In 2023, Daiya Foods Inc., a British Columbia dairy alternative company, launched an innovative product, dairy-free cheese, using fermentation technology part. The new Daiya oat cream blend is striking promising results in the market and attracting huge customers with its dairy-like melt and deliciously balanced cheesy flavor. The dairy-free cheese is made with gluten-free oats and is free from many allergens, including dairy, soy, wheat, and gluten, which was verified by the Non-GMO Project.

DETAILED SEGMENTATION OF THE GLOBAL DAIRY ALTERNATIVES MARKET INCLUDED IN THIS REPORT

This research report on the global dairy alternatives market has been segmented and sub-segmented based on application, distribution channel and region.

By Application

• Milk
• Cheese
• Yogurt
• Ice Creams
• Creamers

By Distribution Channel

• Supermarkets
• Health Stores
• Pharmacies
• Online Stores

By Region

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East & Africa