Dairy Alternatives Market Size, Share, Growth Analysis, By Source (Soy, Almond), By Application (Milk, Yogurt), By Formulation (Flavored and Plain), By Distribution Channel (Retail, Online), By Region - Industry Forecast 2024-2031

Global Dairy Alternatives market size was valued at USD 23.1 billion in 2022 and is poised to grow from USD 25.99 billion in 2023 to USD 66.88 billion by 2031, growing at a CAGR of 12.5% in the forecast period (2024-2031).

Dairy alternatives, made primarily from plant-based ingredients like soy, pea, and almonds, offer numerous benefits, including being free from cholesterol, sugar, lactose, GMOs, and gluten. The dairy alternative market is experiencing significant growth, driven largely by the rising incidence of lactose intolerance worldwide. The market's expansion is fueled by the products' ability to lower the risk of conditions such as diabetes, heart disease, and obesity, as well as shifts in consumer dietary preferences. Almond milk, in particular, is gaining popularity due to its lower calorie content, vitamin D enrichment, and bone-strengthening properties. The market is also benefiting from increased health awareness, a preference for natural foods, higher food expenditures, and media influence on consumer knowledge. Looking ahead to 2024-2031, the industry is expected to see further growth due to manufacturers' efforts to offer unique flavors, enhanced quality, and appealing packaging. Additionally, fortifying these products with vitamins and minerals like vitamin D, calcium, and DHA will boost their nutritional value, driving continued market expansion.

Top-down and bottom-up approaches were used to estimate and validate the size of the Dairy Alternatives market and to estimate the size of various other dependent submarkets. The research methodology used to estimate the market size includes the following details: The key players in the market were identified through secondary research, and their market shares in the respective regions were determined through primary and secondary research. This entire procedure includes the study of the annual and financial reports of the top market players and extensive interviews for key insights from industry leaders such as CEOs, VPs, directors, and marketing executives. All percentage shares split, and breakdowns were determined using secondary sources and verified through Primary sources. All possible parameters that affect the markets covered in this research study have been accounted for, viewed in extensive detail, verified through primary research, and analyzed to get the final quantitative and qualitative data.

Dairy Alternatives Market Segmental Analysis

Global dairy alternatives market is segmented based on source, formulation, application, distribution channel, nutrient, and region. Based on source, the market is segmented into soy, almond, coconut, rice, oats, hemp, and others. Based on formulation, the market is segmented into flavored, and plain. Based on application, the market is segmented into milk, ice cream, yogurt, cheese, creamers butter, and others. Based on distribution channel, the market is segmented into retail (supermarkets & hypermarkets, health food stores, pharmacies, convenience stores, other), food services, online stores, and others. Based on nutrient, the market is segmented into protein, starch, vitamins, and others. Based on region, the market is segmented into North America, Europe, Asia Pacific, Middle East and Africa, and Latin America.

Drivers of the Dairy Alternatives Market

As veganism gains traction, plant-based milks and dairy products are expected to surpass traditional dairy options in market share and growth rates. The rising popularity of flexitarian, vegetarian, and vegan diets is likely to drive increased demand for plant-based dairy alternatives. Concerns over human health, animal welfare, and environmental impact may further challenge the dairy industry's profitability. To thrive in this evolving market, value-added products that cater to both consumer preferences and nutritional needs will be crucial for sustaining growth in the sector.

Restraints in the Dairy Alternatives Market

One of the main challenges facing the market for plant-based milk and dairy products is their organoleptic profiles. Processors often encounter difficulties with solubility and flavor when developing non-dairy products. As a result, these dairy-free alternatives generally have lower repeat purchase rates compared to traditional dairy products, as their sensory qualities still fall short of those found in dairy milk and its derivatives. Additionally, some plant-based milks and their derivatives are relatively low in macro- and micronutrients, which impacts their nutritional standing compared to conventional dairy products.

Market Trends of the Dairy Alternatives Market

The growth of the dairy alternatives market is being driven by several factors, including the increasing prevalence of chronic conditions like diabetes, cardiovascular diseases, and gastrointestinal disorders, as well as a rise in dairy allergies. Growing consumer awareness of the benefits of dairy alternatives, which are often easier to digest and less likely to cause bloating compared to traditional dairy, is expected to further fuel market expansion. Additionally, the global trend towards veganism and advancements in production technologies, such as enzymatic liquefaction and ultra-high temperature (UHT) processing, are contributing to this growth. The market is also supported by the availability of various sweetened, flavored, and unsweetened options, effective marketing campaigns, and increasing urbanization worldwide.