Canada Plant-based Food and Beverages Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Canada Plant-based Food and Beverages Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Canada plant-based food and beverages market is projected to register a CAGR of 9.22% during the forecast period (2022 - 2027).

Early in April 2020, meat packing plants began to close as a result of the Covid-19 virus' quick spread among employees. According to Statistics Canada, Covid-19 shook up the supply of beef in Canada by forcing the closure of numerous slaughterhouses and meat processing facilities, causing customers to rush out and buy beef out of worry over a potential shortage. While farmers received reduced prices for their cattle, consumers saw unusual price hikes for beef. Such conditions posed new opportunities for plant-based companies. Though Covid-19 had a significant impact on the retail food industry in 2020, consumers’ shift to plant-based foods started pre-pandemic and the trend is expected to grow in the future.

Over the medium term, the market is expected to be driven by the increased consumer demand for vegan food and beverages such as coconut milk, almond milk, and plant-based meat products, among others. Further, the rising preference for specific nutrients has led to an increased demand for functional plant-based food and beverages, which are usually fortified with vitamins and other essential nutrients.

Moreover, rising concern about animal welfare along with increased environmental awareness are identified as key driving factors of the Canada market. Availability of media coverage that reveals the impact of meat and dairy production on global warming and greenhouse gases is likely to foster the consumer shift toward plant-based food and beverages over the forecasted period.

Key Market TrendsIncreasing Awareness About Benefits Associated with Vegan Diet

The constant rise in the production of meat products, coupled with the increasing population, is causing acute damage to the environment and leading to global warming issues. In order to solve global warming-related problems as well as to fulfill the rise in demand for meat products, many economies around the world are focusing on developing innovative vegetarian product solutions, offering new opportunities for meat substitutes in the market.

Also, alternative protein sources can reduce the negative environmental impact linked with meat production, as livestock is a major contributor to greenhouse gas emissions. Further, rising consumer awareness about vegan nutrition and willingness to spend on plant-based food products is likely to create lucrative market growth opportunities over the forecast period. For instance, a research study conducted by Angus Reid Institute, a Canadian public opinion research foundation, in the financial year 2019-2020 found that nearly all Canadians are familiar with plant-based meat alternatives (95%) and nearly four in ten (39%) had tried them. Additionally, according to the survey results published by the National Library of Medicines in 2020, 13·6 % of respondents reported the adoption of plant-based dietary practices. The survey included youth and young adults from five major cities in Canada.

Growing Popularity of Alternative Dairy Products in Canada

Rapid urbanization and a growing number of health-conscious young professionals are driving the retail sales of dairy alternative products in the Canada market. For example, in December 2021, the largest quick-service restaurant business in Canada, Tim Hortons, announced that its 4,000 Canadian stores now carry Chobani oat milk. The lactose- and gluten-free oat-based substitute can be added to any hot or cold beverage. Low-calorie, gluten-free, vegan foods are generally considered premium and clean eating foods. Many manufacturers use organically produced finest ingredients to prepare an authentic premium dish or beverage.

Cashew milk thickens faster than regular milk when heated which gives a rich and premium taste to various beverages and spreads. There is also a rise in almond and coconut milk as healthier substitutes. Various products like almond butter, almond spread, rice milk in the pudding, hemp milk for salads and lattes, flaxseed milk for smoothies, and coconut milk for cereals and curries, among others are all widely popular vegan and plant-based ingredients utilized in both sweet and savory dishes. Manufacturers are also working on improving the flavors and texture of these products using various plant-based ingredients and additives while maintaining their high-quality nutritional profile. Dairy substitutes are perceived to be healthier substitutes and are gaining popularity among Canadians hence, driving the plant-based food and beverages market.

Competitive Landscape

Some of the major companies in the market include Nestle SA, Impossible Foods Inc, Beyond Meat, Otsuka Holdings Co. Ltd. (Daiya Foods), and Danone SA. The competition is increasing in the Canada plant-based food and beverages market with both domestic and international players focused on new product launches that include innovative flavors, improved textures, and clean label ingredients. Further, leading companies invest in the mergers and acquisitions of local players to accelerate market growth. For instance, in January 2022 PlantPlus Foods LLC acquired Sol Cuisine Ltd., a Canadian producer of tofu and fresh and frozen plant-based meat substitutes, for roughly USD 99 million.

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