According to MarketsandMarkets, the global dairy alternatives market size 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% in terms of value. The growth of dairy alternatives market can be attributed to the growing vegan and flexitarian population across the world and increasing demand for plant-based products. Along with that, increased demand for lactose-free food and beverages are also expected to further fuel the dairy alternatives market in the forecasted period. Asia Pacific region dominated the global dairy alternatives market.
Dairy alternative products are derived from plant-based sources to mimic dairy products and are designed to be distinguishable from their dairy-based equivalents. They are referred to as “dairy alternatives”, as they directly substitute dairy products, made using plant sources such as soy, almond, coconut, rice, oats, and hemp. The most common dairy alternative products available in the market are milk, yogurt, ice creams, cheese, and creamers.
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Asia Pacific region dominated the global dairy alternatives market. It is largely driven by the rising demand for dairy alternatives in large economies such as China, Japan, Australia, partnered with a strong agricultural production base for plant-based sources such as soy, coconut, and rice. The region is also a key importer of plant-based sources. Along with it, the overall investment in the Asia Pacific region has also increased substantially over the past decade. The changing lifestyles of consumers and increase in the consumption of clean label products is also fueling the growth of dairy alternatives market in the region.
Among various sources of dairy alternatives, soy accounts for the major market share in the overall dairy alternatives market. Soy-based dairy alternatives are considered to be one of the best substitutes for dairy products owing to its nutritional content. They are rich source of proteins and calcium and are very suitable for lactose-intolerant individuals. Soy-based products also lack casein, which is also a cause of many milk-based allergies.
Based on application, the yogurt segment is projected to be the fastest-growing during the forecast period. The growth is mainly associated with the growing awareness about dairy alternatives and their benefits among consumers. Major brands offering yogurt alternatives in the market include Dream and Joy offered by The Hain Celestial (US) and Silk and So Delicious offered by Danone (France). The demand for new varieties is rising, creating new opportunities for dairy-free yogurt manufacturers.
Among various distribution channels, the online stores segment is projected to be the fastest-growing from 2020 to 2026. Many key players operating in the dairy alternatives market have started offering their products for sale through online channels. Online stores are a convenient place for the consumers to place orders as well as getting the products home delivered. These online platforms offer a wide variety of options that too at discounted rates as compared to traditional retail prices. Online stores are getting popular as they are easily accessible and cost-effective.
The flavored dairy alternative products accounts for the major share in the overall dairy alternatives market. The incorporation of flavors in products enhances the palatability and helps the manufacturers to diversify their product portfolio.