Tastes are changing, as well as attitudes towards different food products. Plant-based milk, one of the biggest consumer segments seeing a rise in recent years, is no longer hot on today’s menu after once logging explosive growth rates. Part of that has been increased competition and price sensitivity, though other consumers have been returning to dairy amid a slowing plant-based movement.
Quote: “In the past, when people were talking about climate change or sustainability, it was in a doom and gloom, in a punitive, in a very negative… way. And people got fed up with that,” Oatly (NASDAQ:OTLY) CEO Jean-Christophe Flatin told the Financial Times. “There has been too much greenwashing.”
In the U.S., sales in the alternative milk beverage industry fell 4.4% last year to $2.9B, according to data from NielsenIQ. That marked the first decline in four years, and things don’t look any better for 2025. Milk’s market value is growing much faster than the plant-based theater, with various types of cow milk (including lactose-free and whole milk) outpacing their once-hot oat, almond, coconut, and soy alternatives.
Outlook: Players like Oatly (NASDAQ:OTLY) have seen their stock price tumble since a high-flying IPO in 2021, with shares nearing the single digits after trading in the hundreds of dollars. A similar situation has played out for Beyond Meat (NASDAQ:BYND), whose shares trade at less than $1 today. As consumer appetite toward these products loses its luster, trends are shifting toward things like high protein and gut health, leading to M&A like PepsiCo’s (PEP) recent purchase of Poppi and Danone’s attempt at Lifeway Foods (LWAY) (though the latter deal just fell apart).
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