Dairy-free milk continues to increase its attain throughout the US with the market valued at greater than $4.25 billion in 2024 and anticipated to achieve greater than $7 billion by 2029. Whereas almond milk stays the grocery store class chief, oat milk is seeing elevated demand. Main that demand is the Swedish label Oatly, finest recognized for its quirky packaging and snarky advertising efforts whilst wellness influencers criticize oat milk.
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Almost as shortly as oat milk rose to grow to be a barista favourite for its creaminess that mirrors dairy, TikTok wellness platforms blasted it for its glycemic content material; they are saying oat milk incorporates an excessive amount of sugar, starch, and controversial processed seed oils.
However the hype could also be unwarranted. “In a wholesome one who’s consuming low portions of oat milk and following a largely entire meals, minimally processed, decrease carb food plan, I might say it’s not a significant situation,” Melissa Smith, a nutritionist at The Well being Gardener, instructed Newsweek. However, she cautions, “If somebody is utilizing excessive portions of oat milk in addition to consuming numerous extremely and ultra-processed meals, notably carbohydrate-based meals, then it may contribute to metabolic dysregulation and the event of well being points.”
Oat milk demand
Nonetheless, demand for oat milk is on the rise. Based on retail knowledge firm SPINS, demand for oat milk within the US jumped 28 p.c over two years, pushing gross sales north of $695 million in simply the final yr.
Oatly continues to be the market’s key driver. The corporate reported a ten.9 p.c improve in income for the third quarter of 2024, totaling $208 million. This development was pushed by robust quantity will increase and improved provide chain efficiencies.
Oatly
Jean-Christophe Flatin, CEO of Oatly, commented on the corporate’s efficiency, stating, “Our crew’s continued concentrate on strong execution has enabled us to drive worthwhile development in every of our three working segments.”
Regardless of these achievements, Oatly has adjusted its full-year income development outlook. The corporate now anticipates figures close to or barely beneath the low finish of its beforehand projected vary. Challenges similar to slower development within the plant-based milk class (within the UK) and heightened competitors in Southeast Asia have tempered expectations. Oatly introduced the closure of its Singapore facility earlier in December on account of the Asian decelerate.
Competitors can also be ticking up. Beginning in January, SunOpta’s Dream Oatmilk Barista oat milk will grow to be obtainable in additional than 6,700 places throughout North America. The growth is a part of a strategic partnership with an unnamed main espresso chain, which funding agency DA Davidson speculates to be Starbucks. The barista-focused oat milk, designed particularly for espresso functions, isn’t presently obtainable in retail shops.
This important improve in distribution will leverage SunOpta’s current infrastructure, together with its oat extraction facility in Modesto, CA, and its manufacturing plant in Midlothian, TX. These amenities will play a vital function in assembly the excessive manufacturing volumes required by this new partnership.
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“We’re extremely proud to provide our clients with plant-based beverage choices, together with our Dream Oatmilk Barista,” Brian Kocher, CEO of SunOpta, stated in an announcement. “We perceive that each single impression for a barista and a espresso lover is valuable. We provide scrumptious plant-based options whereas striving to create an ideal expertise.”
SunOpta’s concentrate on sustainability additional enhances its enchantment. The corporate’s nationwide manufacturing community and recyclable packaging codecs intention to scale back meals miles, minimize prices, and decrease waste. “We’re dedicated to a extra sustainable future by working to scale back water, packaging, and carbon emissions,” Kocher added.
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SunOpta’s growth aligns with broader development developments within the plant-based milk market. Analysts predict that the market may double in measurement by 2033, with oat milk rising because the second hottest plant-based beverage. This strategic transfer can also be anticipated to strengthen SunOpta’s monetary efficiency. In its second quarter 2024 monetary report, the corporate reported a 21-percent improve in income from persevering with operations, reaching $171 million. This development was primarily pushed by a 26.9 p.c improve in manufacturing quantity. The extra distribution of Dream Oatmilk Barista is anticipated to additional increase income for the 2025 fiscal yr.
Milkadamia’s Flat Pack innovation
Whereas established manufacturers like SunOpta and Oatly increase their attain, newer improvements are additionally reshaping the oat milk panorama. Milkadamia, recognized for its macadamia nut milk, has launched a groundbreaking product: Flat Pack Oat Milk sheets. Debuted on the 2024 Newtopia Now commerce present, this novel format permits shoppers to make oat milk from scratch utilizing pre-portioned sheets.
Milkadamia
The eco-friendly Flat Pack reduces packaging waste by 94 p.c and reduces packaging weight by 85 p.c in comparison with conventional cartons. Jim Richards, CEO of Milkadamia, defined the motivation behind this innovation. “Pre-cycling places the onus on companies to make proactive modifications. The Flat Pack embodies pre-cycling by considerably lowering ecological prices—minimizing transportation bulk and packaging,” he stated in an announcement.
In contrast to conventional oat milk, which comes ready-to-drink, the Flat Pack requires some meeting. Shoppers combine the sheets with water to create a beverage that provides the identical style and texture as typical oat milk. This shelf-stable product additionally makes use of much less power all through its manufacturing and distribution processes, aligning with Milkadamia’s mission to advertise sustainability.
“A key issue driving the adoption of plant-based meals is eco-consciousness,” Richards stated. The event of the Flat Pack is rooted in each the projected development of the alt-milk class and “a dedication to addressing shopper issues about packaging waste.”
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