Increasing awareness of health and wellness among Japanese consumers is driving the adoption of plant-based dairy alternatives. Though veganism is yet to become main stream in Japan, this trend is changing as consumers are focusing on their health and due to influx of overseas tourists who are vegetarians or vegan.
Also, increasing awareness among consumers regarding environmental sustainability, including greenhouse emissions from cattle farm, is expected to elevate demand for such healthy products including plant-based food, in the post corona era.
Apart from changing consumer preferences, Food with Functional Claims (FCC) is helping legitimize healthy products, ensuring consumers are aware of the legitimacy of the product’s health claims, stimulating consumers’ perception that these product claims are scientifically backed and approved as beneficial to health. Such initiatives improve transparency of health claims made by companies, thereby driving demand for such healthy products.
Lactose intolerance driving market growth
Many Japanese consumers are lactose intolerant and hence do not consume milk or milk products. This has created consumer demand for dairy free products. Consumers above 60 years of age have been on the rise in Japan and such consumers can generally be lactose intolerant, resulting in popularity of milk-based alternatives as a source of calcium to reduce the risk of diseases such as osteoporosis.
The high rate of lactose intolerance among Japanese consumers further boosts plant protein market, with soy protein being the most common plant protein source in Japan, in contract to the west where pea is popular.
Plant-based milk alternatives supporting market growth in Japan
Traditionally, plant-based milk alternatives in form of soy drinks and tofu have been consumed in Asia including Japan. Nevertheless, the consumption of soy drinks has increased in the recent years, owing to rise in disposable income and urbanization. Plant-based dairy alternatives have significant potential to capitalize on consumer’s preference for traditional dairy products.
Furthermore, the growth in consumption of milk alternatives is also driven by the growing middle class who are looking for healthy food and drinks, and younger generations’ rising preference for Westernized products.
Sales of milk alternatives is further supported in Japan by the Foods for specified health use (FOSHU) certification, which includes foods that contain ingredients approved by the Ministry of Health, Labor and Welfare, to promote health conditions. Soy milk which includes soy protein and isoflavones, as its key compounds, is FOSHU certified for its effectiveness against blood cholesterol and osteogenesis, respectively. Consequently, these products resonate well with Japanese consumers who are concerned about their health, thereby increasing consumption of these products in the country.
Additionally, milk alternatives such as soy milk are being substituted not only with dairy products but also being used as a cooking ingredient. Cheese-like ingredients made from soymilk have steadily become popular, as they have been used as ingredients for desserts such as tofu cheesecake and soy tiramisu (Tiratisu).
The aforementioned growth factors have led the manufacturers to come up with innovative milk alternatives to cater to this changing consumer preference.
Soy based dairy and beverages seeing an upsurge in Japan
The market for soymilk and other soy beverages has been growing year on year, as consumers turn towards fitness. Asahi Group Holdings launched plant-based version of Calpis drink (lactic acid drink) using soymilk instead of regular milk, in April 2020. The launch was based on increasing health concerns regarding dairy along with growth potential of plant-based milk market in the country. The company aims to sell 500,000 of these drink boxes mainly to health-conscious female population who are in their 40s or 50s as well as consumer who prefer non-dairy products.
Also, due to upsurge in soy milk in Japan, Kikkoman is focusing on boosting its production system of soy milk and expanding its marketing capabilities to meet the rising demand. Sales of soy milk beverages increased YoY in Q3’FY21 ending December 2020, owing to the growth of unprocessed soy milk given the rising health awareness. Increase in sales was also due to rise in consumption of soy milk as a cooking ingredient as well as a beverage. Additionally, due to increase in demand for home-use, the sales of one-liter containers soy milk improved.
Plant-based ice cream category witnessing growth
Japan is considered to be the top ice cream innovator in the world. Owing to its popularity as a sweet treat among Japanese consumers, ice cream innovations have surged in Japan in the recent years further boosting ice cream consumption.
Rising popularity of Japanese cuisines paves way for companies to use traditional Japanese plant-based flavors including yuzu and hojicha, to innovate their ice creams. Unique flavors, peculiar combinations and uncommon cones are well placed to attract customers, globally including Japan.
Key players
The plant-based protein market is growing in Japan as consumers choose a healthy lifestyle. Also, consumers are focusing on food which is environment friendly and helps reduce greenhouse emissions that cause global warming. Diet free from animal foods is gaining popularity in Japan.
Soy milk has been used as an alternative to cow milk and has been of great interest for people excluding dairy from their diet. Soybeans and soy milk has been a staple in Japanese diets for hundreds of years. Hence, soy milk has been easily available across Japan at cafes, convenience stores, and supermarkets. Various companies have been offering soy milk in Japan including Kikkoman, Marusan, Alpro (Danone), Otsuka, Sujahta, TopValu, Asahi, Kagome, and others.
Japanese soy milk producers have focused on offering familiar Japanese flavors in their soy milk drinks. For instance, some flavors such as grain coffee, banana, yuzu, matcha, oshiruko, ume (plum), black bean, and amazake (sweet sake) are available in the market.
Apart from this, market players have been introducing dairy free products in response to growing interest in plant based products in Japan. For instance, in February 2021, Nestle Japan rolled out Plant-Based Almond and Oat Milk Lattes.
Other key brands in dairy alternative market include EcoMil, PureHarvest, Kyushu, include Tsukuba Dairy Products and TopValu.
Besides food and beverage manufacturers, food service providers such as restaurants, hotels, and institutions, are contributing to plant based dairy market. Starbucks Japan, for instance, introduced Banana Almond Milk Frappuccino and Honey Oat Milk Latte in March 2021.
In the non-dairy yogurt category, soy yogurt is most commonly available in Japan. Apart from soy yogurt, almond, coconut and rice are also available in the market. Some of the key brands in this category include Kokubu Foods and Yasaka Allernon’s food division.
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