As the plant-based milk category grapples with declining sales and consumer skepticism over nutritional benefits and manufacturing processes, companies including Califia Farms, Elmhurst 1925, Virginia Dare and Oatly are strengthening their portfolios and rebuilding consumer trust with new products and education campaigns, which they highlighted at Natural Products Expo West earlier this month.
Plant-based milk sales dip, but blends, coconut and soy surge
Both refrigerated and shelf-stable plant-based milk sales were down by 4.7% year-over-year ending Dec. 29, according to Spins MULO data. Refrigerated plant-based milk sales declined 4.9% from $2.63 billion in 2023 to $2.5 billion in 2024, while shelf stable sales declined from $317 million in 2023 to $309 million in 2024 – a 2.4% drop. However, sales for shelf-stable plant-based milks like plant-based milk blends, coconut milk and soy increased by 10.3%, 27.5% and .7%, respectively, per Spins MULO.
Organic claims for premium plant-based milks and creamers
Gen Z and Millennials are more likely to pay more for organic products, according to an Organic Trade Association and Euromonitor study.
For younger consumers, organic represents environmental and worker benefits, and is a symbol of nutritious foods devoid of hormones, pesticides and antibiotics, per the study.
With younger consumers willing to spend more on organic, brands are exploring innovative ways to gain market share through clear messaging that reflects the organic standard.
Califia Farms’ growth driver is in its portfolio of “simple and organic products,” Dave Ritterbush, CEO of Califia Farms, explained during Natural Products Expo West.
He credits the growth in the company’s premium lineup to consumers preferring minimally processed foods. For example, Califia’s organic lineup is made with three to four ingredients and includes almond, coconut, cashew and oat milk and feature the USDA-Organic icon on the front of the bottles.
Califia extends the organic claim to its organic creamers, which contains natural and “kitchen-friendly” ingredients, Ritterbush explained.
“Our focus continues to be how can we make this with fewer ingredients and ingredients that you are likely to have bought yourself in the supermarket,” Ritterbush said.
Virginia Dare’s organic flavor and extract portfolio
Global ingredient supplier Virginia Dare showcased its organic-certified flavors and extracts for the first time in the organic section of the show, highlighting opportunities for plant-based dairy brands to improve taste and consumer appeal.
The company has “about 250 organic-certified flavors and extract,” tapping into the growing trend of organic and clean label products, explained Philip Caputo, marketing and consumer insights manager at Virginia Dare. As taste remains a key barrier to adoption in the plant-based milk category, Virginia Dare’s portfolio offers brands a way to enhance flavor profiles while maintaining organic and natural positioning.
A member of the Flavor Extract and Manufacturers Association and Organic Trade Association, Virginia Dare “helps uphold the standards for organic flavors,” Caputo said.
As fantasy flavors take flight in beverage formulations, Virginia Dare is equipped with creating organic flavor combinations like cereal milk or cookies and cream due to the company’s robust organic flavor library, Caputo said.
Elmhurst 1925 looks into other product categories to expand market share
Since Elmhurst 1925 transitioned its family-run dairy milk business into plant-based milk in 2017, the company aims to offer clean, nutritious milks, creamers, coffee products and sour cream, Heba Mahmoud, vice president of marketing, Elmhurst 1925, explained during the show.
The company partnered with food scientist Cheryl Mitchell who developed a water-based technology called HydroRelease. The technology separates and emulsifies nutrients from nuts, grains and seeds into a smooth, creamy product, instead of relying on fillers, emulsifiers and other additives, Mahmoud said.
While the company is navigating category declines, Elmhurst continues to see growth as a brand, Mahmoud said. The company intends to explore opportunities in other dairy alternative products to expand its presence in the market.
For example, last year company launched its first product outside beverages – plant-based sour cream in a pouch. Made with the HydroRelease method, Elmhurst’s sour cream contains oat milk and hemp protein, and is non-GMO Product Verified, gluten-free, dairy-free, OU Kosher and Certified Vegan – complementing the rest of its plant-based portfolio.
Mahmoud pointed out that the company will continue exploring other categories with the goal of providing “something new, better or different for the consumer.”
Knowledge is power: Oatly’s nutrition book addresses common myths in plant-based beverages
This year, Oatly published its Small Nutrition Book to address common myths and misinformation about oat milk and oatmeal, explained Chris Link, chief customer officer, Oatly.
The book, available in print and online, tackles misinformation on hot topics, like seed oils and food processing, Link said.
For example, Oatly explains the process of turning oats into oatmilk “because you can’t technically squeeze an oat in your hand and produce milk,” even though “we tried,” they add with a humorous tone.
The company clarified that a processed food does not mean “unhealthy,” and instead “refers to how it has been made, such as canning, chopping, freezing, juicing, fortifying, pasteurizing or drying.”
Oatly also broaches the topic of ultra-processed foods (UPFs) explaining that the oversimplification of UPFs is misleading.
Most of Oatly’s milks are fortified with vitamins and minerals and the company emphasizes that the food industry needs to “stick with dietary guidance based on nutrition quality rather than how a product is made.”
Last year, the company launched its Super Basic Oatmilk, which contains only four ingredients and added sugars created during the production process, and Unsweetened Oatmilk, which has 0 grams of sugar per serving.
