Australian consumers are keen on the source of their food products. They want to ensure that the food they buy and consume should come from ethical sources and be free from animal cruelty. This is causing a shift of preference towards plant-based milk products (like Soymilk).
Increasing awareness on ethical and non-ethical products is directly influencing the buying patterns across the country. As per Sports Dieticians Australia, nearly 2.5 million individuals are following plant-based diet in the country and this is further expected to grow in the coming years. Consumers are avoiding milk and dairy due to gastrointestinal problems. Also, in the recent years, lactose intolerance has also become increasingly more common.
The longer shelf life and higher margin of plant based milk than cow’s milk presents lucrative opportunities for convenience stores. As per industry estimates, sales of milk alternatives in Australia has increased by 48% to 132 million litres in the past four years.
Key drivers
Growing prevalence of milk protein allergy and lactose intolerance driving market growth
Growing milk protein allergy and lactose intolerance in the country is driving the demand for plant based milk products in Australia. Further, demand for vegan/vegetarian foods and concerns regarding animal welfare are other factors driving market growth. Also, the resource and waste-intensive nature of industrial dairy production lead to consumers perceiving plant-based milk alternatives as being more environmentally sustainable t over cow’s milk. Plant based milk release considerably fewer greenhouse gas emissions, eutrophication, water and land use during production. Such factors are expected to pose opportunities for market players.
Soy and almond milk are key drivers for plant based milk growth
Consumption of fluid milk per capita has been gradually declining over recent years in Australia. This trend is likely to be amplified due to COVID-19 impact on the food services sector, which is expected to further report a fall of 2% in overall fluid milk consumption. Consumption of dairy milk has reduced in Australia as more and more people identify themselves as vegans. Also, health, environmental and ethical concerns are driving the market for plant based milk in the country. The increased availability and accessibility of these dairy substitutes have driven consumption.
Moreover, growing taste for plant milks by Australia’s coffee drinkers is another factor supporting plant based milk growth. Soy milk is one of the most sustainable milks and consumers are embracing this milk their dairy free milk of choice. To cater to this trend, OTR, a convenience retailer began offering Califia Farms Oat Barista Blend at no extra charge to customers across its 155+ locations in South Australia. Also, the retailer rolled out Califia Farms Oat Barista milk to expand its OTR’s milk range.
Demand for almond milk has increased in the recent years due to its nutty and creamy texture. Also, almond milk has the lowest greenhouse gas emissions and uses least amount of land to grow making it environmental friendly. Companies have responded to the growing demand by offering various almond milks. Some of the key players in the almond milk market include Freedom Foods Group Limited, Vitasoy Australia Products Pty Ltd and Australian Health & Nutrition Association Limited.
Key trends
Growing popularity of oat milk
Apart from vegans opting for dairy free coffee, flexitarians too are showing great interest in plant based milk coffee. Oat alternatives have been gaining traction especially in the coffee industry offering the same creamy texture as dairy.
Oats milk is gaining consumer interest owing to better sustainability practices claims and product developments within the category. New players such as Chobani Australia have entered the oat milk market with the launch of Chobani Oat Barista Edition made of organic oats. The company is working with distributors to offer Chobani Oat across Australia via the foodservice channel.
Consumer interest in vegan cheese on the rise
Consumer interest in vegan cheese is on the rise in Australia as they perceive it to be healthier and sustainable choice than dairy. Vegan cheeses are made from plant-based ingredients including coconut, rice, soy, nuts and seeds, nut milks, plant-based yeasts as well as root vegetables. Melbourne has seen a rise in vegans in the city and to take advantage of this, companies have made lot of vegan cheese options available in the city.
In September 2020, MyLife, an Australian plant-based food manufacturer, launched various vegan cheese products under BioCheese brand sold at Coles supermarkets. The new products launched include BioMarinated (vegan parmesan), BioCheese Grated Parmesan, Original BioCreamy, and BioCheese Pizza Shred. The company claims to be the first in the Australian plant-cheese market to offer vegan cheese products five years ago. Also, Damona offers Dairy Free Vegan Cheese across supermarkets, delis, health, organic and online food stores in Australia.
Key players
Growing socially conscious consumers who are seeking for sustainable food and drinks are driving the demand for plant based dairy especially milk products. The market for plant based dairy alternatives in Australia is fragmented with presence of large number of players. Some of the key players in the market include Soulfresh, Vitasoy, Alternative Dairy Co’s, Australia’s Own, Sanitarium, and others. Players have been strengthening their plant based dairy product portfolio to meet the evolving consumer needs.
The Alternative Dairy Co’s backed by Sanitarium Health Food Company, offers soy milk under So Good brand and a range of barista plant milks which are made locally with Australian grown ingredients. The company works closely with baristas, cafe owners, and non-dairy milk consumers to develop plant-based milks. The company further expanded its portfolio with Barista Oat Milk made from Australian grown oats. In Q1’FY21, the company recorded triple sales as compared to Q4’20, due to consumer’s greater interest in plant based milk and the health benefits it offers.
Vitasoy, another key player in plant-based milk claims to be a market leader in soy, oat and rice as well as flavored on-the-go plant-based milk, Whole Almond Milk. The company offers soy milk, almond, oat, coconut, and rice milk.
Similarly, Soulfresh, a F&B company offers plant based dairy products. The company’s Nutty Bruce Almond Milk claims to be a leader in the almond milk category holding ~ 30% market share. Also, recently, Soulfresh further added All Mighty Bruce Future M*lk, a milk alternative made from seaweed, wholegrain, peas, and oats, to its portfolio
Further, companies are focusing on innovating their plant based dairy alternatives to attract consumers. For instance, Bickford’s launched five varieties of plant based milk including almond, Cashew, Oat, Macadamia and Pistachio based milk in November 2020. The company claims to have sourced more than 90% of its ingredients from Australia and its products are free from artificial sweeteners or GMOs. Similarly, NuYu rolled out the same five plant based milk variants in October 2020, which were made in South Australia using 90% Australian ingredients, and 100% Australian oats, almond and macadamias.
Also, Bickford has been focusing on investing in advanced manufacturing technologies to extend its capabilities. For instance, the company invested in Aseptic filling line to ensure the milk range is preservative free and the flavor and color integrity of the nuts and grains is optimized.
In the vegan cheese market, My Life, a plant-based cheese manufacturer, offers vegan BioTzatziki and plant-based BioCheese range at Woolworths stores across the country. Also, Hello Friend Foods offers Fresh Mozzarella without dairy, vegan Haloumi, and The Vegan Cheese Sauce. Other brands in the dairy free vegan cheese market include Daiya, Tofutti, Cheezly, AVS Organic Foods, Vegusto, and Sheese.
To know more and gain deeper understanding of plant protein in Australia, click here.
