How precision tech will reboot dairy industry profits
Overcoming its challenges by meeting them with new technologies will lead to global dairy sales to stretch from $944bn last year to $1.3tr by 2030, with a compound annual growth rate of near 5%.
Plant-based dairy will grow too, though at a fraction of dairy from $12.6bn in 2023 to $26bn at the turn of the decade, according to Eatable Adventure’s The Future of Dairy Report.
“Technological innovation is proving to be a critical force across the entire value food chain, addressing global challenges from farm to dairy,” says the report.
“In the dairy industry, this pursuit of progress is particularly crucial as it navigates the significant challenges including pricing pressures, environmental impacts and profound social transformations.”
New tech in dairy to counter oncoming challenges
Introducing new tech would not only counter the oncoming challenges, it would also shape the sector’s future and help drive evolution.
Six key technologies and innovations included precision fermentation, enabling the use of microorganisms to develop ingredients with molecular compounds closely resembling animal products.
Precision fermentation differs from traditional by using genetically engineered microorganisms to develop specific compounds with precision and efficiency. However, it will take the industry up to five years to commercialise precision fermentation, experts predict.
Cellular agriculture would be utilised more to make animal-based foods using cell cultures instead of traditional methods.
“While cultivated meat has recently dominated discussions, lab-grown dairy is also emerging as a significant player in the realm of animal-free products,” says the report.
“In the dairy sector, this technology is being utilised not only to replicate consumable milk, but also to produce functional human milk as an alternative to breastfeeding.”
Cell-based dairy, though, would be the most expensive of the six target technologies to commercialise and would take the longest for products to reach supermarket shelves at 10 years, experts believe.
Biomass fermentation for mycelium
Molecular farming, plant-cell fermentation and biomass fermentation to grow mycelium were also called out as essential tools set to grow the category.
Though tech enablers, referring to all technological solutions supporting ingredients development – from across hardware and software – would be vital to securing sector success.
Alternatives to dairy were in the past crucial to evolving the sector’s technology and would be going forward. Investment plummeted from a $595m high in 2021 to a $42.7m last year, says the report.
However, the market was beginning to track up, with $114m invested in the sector so far this year, driven by corporate investors who “play a crucial role in alternative dairy investment, highlighting the interest towards innovation”, says the report.
But the “health benefits” of dairy must not be forgotten in the sector’s future transformation, says one sector expert. In fact, these USPs are crucial to the category’s success and “represent a significant opportunity for our industry”, they say.
