The market for dairy and dairy alternative beverages will reach a projected $28 billion by 2021, according to market research firm Packaged Facts in the new report, Dairy and Dairy Alternative Beverage Trends in the U.S., 4th Edition. Spurring the segment’s growth will be plant-based dairy alternatives, which are expected to come to represent 40% of the combined total of dairy and dairy alternative beverages, up from 25% in 2016 when dairy alternative beverages alone accounted for barely $6 billion in retail sales.
The shift away from traditional dairy products such as cow’s milk towards plant-based alternatives revolves around health concerns with a growing number of consumers coming to believe that plant-based foods are healthier than animal-based foods. Further, there is a growing consumer base that is motivated by animal welfare concerns, leading them to choose plant-based beverages, as well as other plant-based foods over animal-based products.
“Vegetarians and vegans together account for less than 15% of all consumers and their numbers do not grow very rapidly, but a growing number of consumers identify themselves as flexitarian or lessitarian, meaning that they’ve cut back on their consumption of animal-based foods and beverages. It is this group that is most responsible for the significant and ongoing shift from dairy milk to plant-based milk,” says David Sprinkle, research director for Packaged Facts, which also recently established a free curated webpage on dairy and dairy alternatives.