The dairy market continues to shift as consumers worldwide seek non-dairy and clean-label alternatives.
The dairy market continues to shift as consumers worldwide seek non-dairy products and clean-label alternatives. These are the conclusions of a market survey that Cargill (Minneapolis) conducted in 5200 grocery shoppers in 13 countries in order to understand which consumer preferences are driving dairy/non-dairy purchases as well as how these preferences differ by region.
These latest findings are part of Cargill’s ongoing efforts to shed light on purchase drivers in the dairy and dairy alternatives markets. In March, the company shared insights from an earlier survey that found that 50% of U.S. respondents consume both dairy and non-dairy products.
This July, at the Institute of Food Technologists’ Annual Meeting and Food Expo in Chicago, the company shared additional findings from the survey, which again come from polling consumers on their purchasing behaviors regarding yogurt, flavored milk, ice cream, and dairy alternatives.
Clean Label Huge Driver
In the current survey, Cargill found a growing number of consumers seeking clean-label products and also identified where, globally, clean-label demands are strongest.
The countries with the highest number of clean-label seekers were Indonesia and China (north of 70%), followed by Russia, Mexico, Brazil, Spain, France, Argentina, and Denmark. Some might be surprised to find that the U.S. fell lower on the list at 40%, followed by Germany and the UK. Finally, Japan seems to have the smallest number of clean-label seekers, with just 30% of survey respondents saying they’re looking for clean-label products.
Mark Fahlin, business development, marketing, for the sweeteners, starches, and texturizers division at Cargill, helped unpack some of the findings. “It was a bit surprising to see China and Indonesia at the very top of the list relative to all the other respondents. We have a hypothesis that in China and Indonesia, the melamine scares that happened a decade ago in China had a lingering impact on trust of the dairy industry,” he told Nutritional Outlook at IFT. At the other end of the spectrum, he said, a country like Japan “may have quite a bit of trust in what’s on the label.”
As for the U.S.? “To be honest, I would have thought the U.S. would have been higher than some of these markets, but it’s perhaps just within the last five to 10 years that the U.S. has really started to ramp up its interest in what’s in my food, what’s on my label,” Fahlin said.
Dairy versus Non-Dairy
Consumer preferences for dairy and dairy alternatives differ by region.
In the U.S. and Europe, Cargill’s survey reflects significant declines in dairy sales and fluid milk consumption in 2000-2016. However, some of that ground is being made up by non-dairy. The U.S., for instance, saw triple-digit growth in consumption of dairy alternatives over that same time frame, and Europe also saw dairy alternatives on the rise. Cargill also notes that many European consumers, like U.S. consumers, are consuming both dairy and dairy alternatives.
Meanwhile, respondents in Asia-Pacific indicated a higher preference for dairy alternatives compared to other regions, with Cargill pegging this market as ripe for additional growth in both dairy and non-dairy.
In Latin America, which Cargill calls one of the fastest-growing dairy markets, a slightly higher percentage of consumers still prefers the taste of real dairy products over dairy alternatives. Cargill also reports that consumers in this market are still spending less than half on dairy products compared to North America and Europe, indicating some opportunity for growth.
Taste Is King
Finally, U.S. consumers surveyed said great taste is the primary driver of all dairy and non-dairy purchases, followed by healthy ingredients, nutritional value, quality of ingredients, appealing texture, and label-friendly ingredients.
Consumers are also seeking pleasing textures, as well as sugar reduction, in their dairy and dairy alternatives. At IFT, Cargill highlighted specific ingredients in its portfolio that can help, including zero-calorie sweeteners, custom texturizing system, hydrocolloids, starches, and plant proteins.