Europe Dairy Alternatives - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts 2017 - 2029

Europe Dairy Alternatives - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts 2017 - 2029

The Europe Dairy Alternatives Market size is estimated at USD 9.42 billion in 2024, and is expected to reach USD 18.78 billion by 2029, growing at a CAGR of 14.80% during the forecast period (2024-2029).

Rise in modern grocery retailing including hypermarkets and online stores fuels the sales through off-trade channels

• Hypermarkets and supermarkets primarily drive the high market share of off-trade channels. Supermarkets/hypermarkets have always maintained a strong lead in the sales of dairy alternatives in the market studied. The proximity factor of these channels, especially in large and developed cities, provides them the added advantage of influencing the consumer's decision to purchase among a large variety of products available in the market. Supermarkets and hypermarkets covered 61.38%, by value, of dairy alternative sales through off-trade channels in 2022.
• The online channel is projected to be the fastest-growing distribution channel as modern consumers prefer online grocery purchases due to their busy lifestyles. Around 68% of individuals in the European Union ordered or bought goods or services over the internet for private use in 2022, up from 54% in 2017. The Netherlands, France, the United Kingdom, Germany, and Italy are the countries with high penetration of internet users. Online sales of dairy alternatives are estimated to record a CAGR of 25.80% during the forecast period.
• By product type, plant-based milk is the largest sold category across online retail channels. Key German supermarkets offering coconut milk include Müller and Alnatura. Koro brand coconut milk is available across 122 Müller stores located in Germany.
• On-trade sales are primarily driven by the rising number of restaurants and cafes specializing in vegan menus across key countries such as the United Kingdom, Germany, and Italy. In the United Kingdom, the on-trade sales value of dairy alternatives is estimated to record a CAGR of 22.62% during the forecast period to reach a market value of USD 142.40 million by 2029.

Growing number of lactose intolerant consumers in europe is fueling the dairy alternative market

• The European dairy alternatives market observed a growth of 17.25% in 2022 compared to 2021. The growth was attributed to the rising volume of lactose-intolerant populations across the region. In 2022, 5% of the total population was lactose intolerant. In the United Kingdom, lactose intolerance is more common in people of Asian or African-Caribbean descent. Lactose intolerance can develop at any age. In many cases, the symptoms first develop in people aged 20 to 40, although babies and young children can also be affected.
• To mitigate the effects of lactose intolerance, these consumers mainly consume oat milk as a replacement for animal milk. Consumers dealing with the risk of obesity prefer low-fat beverages. Animal-milk-based products contain more fat percentages compared to plant products. One cup of unsweetened cashew milk contains 25 calories, less than 1 gram of protein, and 2 grams of fat, while animal milk (goat milk) contains 10 grams of fat. As a result, there is a rise in demand for dairy-free products in the European region. Hence, the market is estimated to grow by 58.64% by 2025 from 2022.
• Under the off-trade segment, convenience stores hold the second-largest share of 71.35% of the country's retail space. These stores offer cashew milk at varied prices (low, medium, and high). The average selling price of cashew milk in the United Kingdom is USD 20.5. Some famous convenience stores across the country are 7-Eleven, Marks & Spencer, Little Waitrose, The Co-op, and Sainsbury's. To captivate consumers' focus toward the hemp milk segment, these retailers offer hemp milk at varied prices (low, medium, and high). This aspect also promotes the buying power of consumers.

Europe Dairy Alternatives Market Trends

The increasing awareness and concern among consumers, particularly the younger generation, about health and environmental sustainability is impacting the consumption of dairy alternatives in Europe.

• Consumption of plant-based food is growing across Europe. It grew by 49% between 2019 and 2020. Around 37% of Europeans are flexitarian, vegetarian, or vegan, and 40% of people intend to cut back on dairy consumption in Europe. Flexitarian lifestyles are becoming popular among consumers of all ages. Around 26% of the population in a survey preferred non-dairy yogurt as their mid-morning snack.
• For the younger generation in Europe, in particular, health is a top priority. Increased use of antibiotics in animal breeding and, therefore, animal produce increased the demand for dairy alternatives, which emerged as a cleaner and safer product for long-term consumption in the region. One-fourth (39%) of those between 18 and 35 years cut the consumption of dairy products as they contain fats, while 34% stopped consuming them due to their sugar content. Younger consumers are far more inclined to consume dairy substitutes, with 46% of them drinking non-dairy milk, 33% of them consuming non-dairy ice cream, and 35% of them eating non-dairy cheese at least once a week.
• There is a huge demand for non-dairy cheese varieties, such as plant-based cheese, especially sliced cheese, with a great sales value in several countries in the region. Spanish and German consumers reveal the highest readiness to eat plant-based cheese. For instance, German consumers prefer plant-based cream cheese (32%), sliced cheese (32%), and plant-based mozzarella (31%) available in supermarkets. With the increasing demand for plant-based dairy innovations, the consumption of dairy alternatives is anticipated to increase during the forecast period.

Europe Dairy Alternatives Industry Overview

The Europe Dairy Alternatives Market is fragmented, with the top five companies occupying 33.40%. The major players in this market are Danone SA, Ecotone, Oatly Group AB, The Hain Celestial Group Inc. and Upfield Holdings BV (sorted alphabetically).

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