Growing market for dairy alternatives

New product development is driving growth in the Nordic market for dairy alternatives with sales increasing by 20% a year. The Nordic region is a hotbed of new product development with leading manufacturers like Ceba Foods investing up to 10% of their turnover in research & development. The company’s success with its Oatly brand has led it to venture from oat drinks to ice-creams and custards. It has become the first company in the world to launch a pasteurised oat drink as a fresh milk alternative. Other Nordic producers like Bioferme and Ingman Foods are also investing heavily in research and development; these companies have recently launched probiotic yoghurts and premium ice-creams respectively.

Dairy alternatives are gaining popularity as consumers become more aware of the health benefits of these products. Manufacturers are responding by re-positioning their products as functional foods, focusing on specific health benefits in marketing campaigns. Soya- and oat-based products have made most inroads, especially in the drink and yoghurt segments. Organic Monitor’s new report on The Nordic Market for Dairy Alternatives finds Sweden and Finland to have the leading markets in the region. Although all countries are reporting high growth, production and sales of dairy alternatives is concentrated in these two countries. The Swedish market is the largest, partly because of the success of oat drinks; Sweden is the only country in Europe where oat drinks are the preferred dairy milk substitutes. Ceba Foods is building on its success in the Swedish market by making Oatly into an international brand of oat drinks.

Danish and Norwegian consumers are the least consumers of dairy alternatives. Danish consumers were found to shun dairy milk substitutes because of support for their dairy industry; whilst low product availability limits demand in the Norwegian market. Both markets are projected to show high growth in the coming years as the incidence of lactose intolerance rises and as consumer demand for health foods increases. Organic Monitor finds the competitive landscape becoming increasingly fragmented, with manufacturers focusing on niche segments. Although not producing in the Nordic region, Alpro commands high market share because of its extensive product range. Nordic companies are advised to build market share by focusing on product innovations and meeting consumer demand for functional foods. Research Publication: #1401-51: The Nordic Market for Dairy Alternatives, http://www.organicmonitor.com/140151.htm

Organic Monitor is a business research & consulting company that specialises on the global organic product & related industries. Their consultants have been tracking developments in the international dairy alternatives market since 2001. For further information, please contact: Ms. Ewa Niecikowska, Organic Monitor, Tel: (44) 20 8567 0788, Fax: (44) 20 8567 7164, Email: press@organicmonitor.com

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