Plant-based dairy alternatives on the rise in Australia

New technologies like precision fermentation are set to boost the market.

Plant-based dairy alternatives, including those made from grains, nuts, rice, and seeds, are gaining popularity in Australia due to their health benefits, GlobalData reported.

New technologies like precision fermentation are set to boost the market, which is projected to grow at a compound annual growth rate of 5 to 6% from 2024 to 2028, according to GlobalData.

“Although white milk is deeply rooted in the Australian diet, the past five years have witnessed a notable rise in the popularity of plant-based dairy substitutes,” said Mani Bhushan Shukla, a consumer analyst at GlobalData.

“This trend has been largely fueled by a rising awareness of lactose intolerance and milk allergies,” she said.

She added that innovative products offering a more authentic taste and texture are attracting health-conscious consumers.

Deepak Nautiyal, consumer and Retail Commercial Director for Asia-Pacific at GlobalData, added that oat and almond milk are popular for their flavors and creamy textures. Pea milk is also rising in popularity due to its smooth mouthfeel and high protein content. 

Nautiyal expects sales of grain, nut, rice, and seed milk alternatives to outpace those of soymilk through 2028, aided by marketing from brands like Cauldron Ferm and Vitasoy Australia.

Despite this growth, plant-based dairy alternatives have not fully penetrated the mass retail sector. 

Nautiyal, citing a GlobalData survey, said that 66% of Australians are hesitant to try these products due to concerns about taste, texture, and smell, whilst 22% find them too expensive. 

“This necessitates a greater allocation of resources towards research and development in this sector,” he said.

Shukla noted that manufacturers are exploring advanced technologies like precision fermentation, which uses genetically engineered microflora to create dairy-like proteins without animal products. This method could produce substitutes that closely mimic traditional milk.

Innovators like Cauldron, Perfect Day, and Change Foods are leading the charge in the Asia-Pacific region.

“Whilst this technology could revolutionize the market for dairy alternatives, the primary challenge will be to foster acceptance of GMO products amongst Australian consumers,” said Shukla.