Growth in plant-based dairy slowed in 2022, following the relatively strong rebound seen in 2021, after sales had shown a marked decline in 2020, mainly due to the pandemic-induced slump in the Chinese market in this year. Other plant-based milk, thanks to its dominance in China, has slightly higher sales than soy drinks in the region, while plant-based yoghurt and cheese remain very small categories. Other plant-based milk will be driving overall market growth in the region in 2022-2027.
This report comes in PPT.
Sales recorded a particularly sharp decline in China in 2020, impacted by the strict COVID-19 measures introduced across a number of its cities and regions. Given the size of the Chinese market, this therefore also dragged down the overall Asia Pacific performance in this year. While there was a relatively strong recovery in 2021, followed by further positive growth in 2022, sales have yet to return to pre-pandemic levels in either China or the region as a whole.
Soy drinks is the most developed area of plant-based dairy in both Japan and South Korea, and is also a fairly mature category in both countries. Players in South Korea are therefore attempting to offer additional value to local consumers through functional ingredients to maintain interest and demand, such as Vegemil’s new soy drink with BCAA, protein, calcium and vitamins B and D.
Already recording strong growth pre-pandemic, the e-commerce channel’s value share gains were given further impetus by the COVID-19 restrictions in 2020. Online sales have continued to register healthy growth rates in both 2021 and 2022, reaching a regional share of almost 9%. The biggest e-commerce share is 31% in South Korea, up from 17% in 2019. Nevertheless, modern grocery retailers, mainly supermarkets (38%) and hypermarkets (17%), remains the main mode of distribution in Asia Pacific, followed by small local grocers (22%).
Growth in plant-based dairy will peak in 2023, before then gradually slowing year on year, and even slipping into (slight) decline in 2027. The other plant-based milk category’s performance will be very much in line with the overall market’s, while soy drinks will be stagnating or declining slightly during the forecast period. Plant-based yoghurt and, in particular, plant-based cheese will see strong growth, albeit from still very small sales bases.
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