Oat milk is rapidly emerging as a fashionable new addition to the alternative milk and yogurt market. With yogurt sales declining, an increasing number of consumers are seeking substitutes, which has opened up growth opportunities for various brands. According to ReportBuyer, the global dairy alternatives market is projected to exceed $34 billion by 2024. While there are numerous alternatives available, such as almond, soy, coconut, and hemp milks, oat milk is quickly becoming the frontrunner. In yogurt applications, this dairy alternative boasts nearly double the protein content of almond milk and does not require a multitude of thickeners or chemicals to achieve the desired texture. Moreover, oat milk is more sustainable than nut-based options, as oats require significantly less water for production, according to the Institute for Water Education. These benefits have significantly boosted the appeal of oat milk among both consumers and manufacturers.
A report from FreshDirect indicates that oat milk is surpassing nut-based milks in consumer preference. Nielsen data, as reported by Food Navigator, shows oat milk sales surged by 32.5% from 2017 to 2018, whereas almond milk only increased by 11.5% and coconut milk saw a mere 1% rise. However, this surge in oat milk’s popularity has also intensified competition. Brands such as Oatly, Planet Oat, Elmhurst, Thrive Market, Pacific Foods, and Happy Planet have recently launched oat beverages. Additionally, new oat-based products are making their way to market, including Hälsa’s vegan drinkable “oatgurt,” which premiered at Wegmans last summer.
Despite the novelty of So Delicious oat yogurt, Danone already has a diverse portfolio featuring this ingredient. Earlier this year, the company’s Silk brand introduced Oat Yeah oat milks and yogurts, while So Delicious launched frozen desserts in the spring. Currently, the market has more oat milks than yogurts, potentially giving So Delicious an early advantage. However, the yogurt aisle is becoming increasingly crowded as traditional dairy sales struggle. According to Nielsen data shared by The Wall Street Journal, yogurt sales have declined for the past two years after a decade of growth. Companies are experimenting with various substitutes, from buffalo milk yogurt to Greek yogurt infused with nut butters. The influx of new options in this already saturated category could lead consumers to overlook new products, but it may also reinvigorate the market.
A significant challenge facing the alternative milk sector is the ongoing dispute between dairy producers and alternative milk manufacturers over the use of the term “milk” for non-dairy products. The FDA is currently evaluating the definition of this term, and its decision could dramatically impact the alternative dairy industry. In light of this, Danone has labeled its new product as a “yogurt alternative” to mitigate potential backlash. Simultaneously, the company continues to use “oat milk,” which is the conventional term for oat-based beverages competing in the dairy space. Depending on the FDA’s ruling regarding the term “milk,” this nomenclature may need to be revised in the future.
This new offering is likely just the beginning of Danone’s foray into the plant-based market, which saw the company invest millions in expanding a Pennsylvania facility dedicated exclusively to plant-based food production in February. With plant-based sales rising by 11% over the past year and further growth anticipated, it is likely that more industry giants, including Danone, will make substantial investments and develop new products in this sector.
In addition, consumers looking for nutritional supplements may be interested in products like Kirkland Signature Calcium Citrate Magnesium and Zinc with Vitamin D3, which can complement a plant-based diet. The integration of such supplements can enhance the overall health benefits associated with plant-based eating, thereby attracting more consumers to alternatives like oat milk and its associated products. As the demand for plant-based options increases, we may see a growing trend in combining these dietary changes with effective nutritional supplementation, such as Kirkland’s offerings, as part of a balanced lifestyle.