Packaged Facts: Almond and coconut milk on fire; soy milk on the skids; skim milk losing share

According to IRI multi-outlet data* US retail sales of almond milk rose from $686.6m in 2013 to $946m in 2014 (refrigerated: $854.3m + shelf-stable: $91.7m), a 38% rise. Volumes rose 28.4%.

However, if you include sales from outlets not covered by IRI such as Whole Foods, ALDI and Trader Joe’s, Packaged Facts estimates 2014 sales were likely closer to $1.19bn.  

So accounting for sales from these retailers, Packaged Facts reckons almond milk’s share of the dairy and dairy alternatives beverages market could rise from 5% of this $23.75bn market in 2014 ($1.19bn) to 19% of an estimated $31.5bn market in 2019 (almost $6bn).

As almond milk was growing by double digits… soy was shrinking in double digits ​

But why is almond milk so popular, and where is the growth coming from?

According to Packaged Facts, almond milk is taking share from dairy milk but also from soy milk, sales of which plummeted 16.1% to $346m in 2014, despite its arguably superior nutritional credentials.

 “Almond milk has grown not only at the expense of dairy milk but also apparently at the expense of soy milk, taking share away from what for many years had been the mainstay of the dairy alternative beverages category.​

“From 2013 to 2014, as almond milk was growing by double digits… soy was shrinking in double digits,” ​a phenomenon it attributed mainly to the superior flavor and mouthfeel of almond milk over soy milk but in part to health concerns over soy, however unfounded.

But almond milk is not the only game in town, noted Packaged Facts, which says US retail sales of coconut milk rose from $116.7m in 2013 to $134.8m in 2014, a 15.5% increase (IRI multi-outlet data*). Meanwhile, sales of hemp and cashew milk are also growing, and other products such as peanut milk​​ are in development.

“Cashew milk is attracting most of the attention as it is considered to offer a texture closer to that of whole milk and also a similar taste while at the same time having less fat and fewer calories.”​

Liquid milk is steadily losing market share ​

As for liquid dairy milk, Packaged Facts predicts that the dollar share of skim and 1-2% fat (low-fat) milk will drop from 45% to 35% of the US retail dairy and dairy alternative beverages market between 2014 and 2019, although sales will still rise around 4% over the period.

As for why non-dairy ‘milks’ are doing so well, taste and perception are key, said Packaged Facts.

For example, while almond and coconut milk are not naturally high in protein**, are fortified with vitamins to compete with dairy in the nutritional stakes, and often contain added gums and starches to create a thicker texture - which can lengthen the ingredients list; many consumers still regard them as healthier than dairy, and many prefer the taste.

Packaged Facts explains: “Almond milk also benefits from an overall move away from dairy products due to concerns about the use of antibiotics and/or growth hormones to increase cow milk production, as well as a broader move away from animal based products - whether meat or dairy - over health concerns about lactose, fat and cholesterol.”​

Given that sales of some dairy products have been growing as liquid milk has been falling, however, this may only be a partial explanation, with some observers saying other factors such as lower consumption of ready-to-eat breakfast cereal and the growth of other beverages such as bottled water and changing lifestyles/eating habits are more to blame for liquid milk’s woes than concerns about hormones or cholesterol.

Sales of fermented dairy beverages such as Kefir, for example, are growing strongly, noted Packaged Facts.

Can you call plant-based beverages 'milk'?​

After some commentators on our site queried whether it was legal for plant-based beverages sold in the US to describe themselves as ‘milk’ (almondmilk, cashewmilk etc), FoodNavigator-USA sought clarification from the FDA.

A spokesman said: “The standard of identity for ‘milk’ is in ​21 CFR § 131.110​​[the lacteal secretion, practically free from colostrum, obtained by the complete milking of one or more healthy cows]. ​

He added: “The agency does not have a specific regulation that authorizes the use of the names you referenced (i.e., ‘almondmilk’, ‘soymilk’, ‘peanutmilk’, or ‘cashewmilk’).  FDA’s regulations regarding common or usual names for food, including those names FDA has established by regulation, can be found in 21 CFR Part 102​​.”

CA court found terms such as almond milk and coconut milk did not mislead consumers​

While many people in the dairy industry are not happy with companies using terms such as 'almond milk', the issue had been tested in the courts via consumer litigation fairly recently, David Biderman, a partner in Perkins Coie’s Consumer Class Action Defense practice, told FoodNavigator-USA.

For example, a class action (3:13-cv-01953) filed against WhiteWave Foods alleging that terms such as almondmilk, soymilk, and coconutmilk were misleading, was dismissed by a California federal judge in 2013, who said that almond milk was the common or usual name for the products in question and that the word 'almond' before milk cleared up any possible confusion.

Under the plaintiffs' logic, said the judge, consumers might also "assume that 'flourless chocolate cake' contains flour or 'e-books' are made out of paper".​

Said Biderman: “The court held that the soymilk and related terms met the common and usual name requirements of the FDA. The court also found it implausible that consumers would be confused by these names and rejected any claim that these names were a violation of the FDA regulations defining milk.”​

Read more about Packaged Facts’ latest report: Dairy and Dairy Alternative Beverage Trends ​​

*Packaged Facts based on IRI multi-outlet (MULO) data, which represents sales through U.S. supermarkets, drugstores, mass merchandisers (Walmart, Target, Kmart, and Shopko), Sam’s Club and BJ’s warehouse clubs, dollar stores excluding Dollar Tree, and military commissaries. Doesn't capture sales from Whole Foods, Trader Joe's, Aldi etc

**The ingredients list for original unsweetened Almond Breeze is:  Filtered water, almonds, calcium carbonate, sea salt, potassium citrate, carrageenan, sunflower lecithin, natural flavor, vitamin A palmitate, vitamin D2 and d-alpha-tocopherol. The protein content is 1g per 240ml serving vs 8-9g for dairy milk