Author: Paola Vacca
A Glimpse into the Future of Vegan Food Markets (2023-2027): charting the Compassionate Culinary Map
According to Technavio's latest market research the growth of the vegan food business market is projected to reach USD 20.03 billion by 2027, with an expected CAGR (Compound Annual Growth Rate) of 12.07% during the period 2023-2027.
Growing number of vegan consumers is the key factor driving the growth of the market. With an increasing number of people adopting a vegan lifestyle, the demand for plant-based foods is unstoppable.
It might be useful to read the article The Rise and Impact of Veganism to understand the health and ethical reasons behind veganism.
Non-dairy cheese, meat and eggs alternatives, mindful drinks are some of the dishes/products already served in every restaurant and sold in the top supermarkets a well.
These factors will fuel the growth of the global vegan food market in the future.
Let's take a closer look at the current market scenario, trends, drivers and the overall market environment.
Population and geographical markets
The Technavio report highlights that the global vegan population reached nearly 79 million in January 2021, indicating a 3% increase from the previous year. This upward trend in vegan consumers is expected to drive a continuous growth of the vegan food market until 2027.
North America is estimated to contribute 40% to the growth of the global market during the forecast period (2023-2027).
Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period: the US and Canada are among the top vegan food-producing countries in North America and in the world.
Segmentation of the Vegan Food Market by Product
The surge in demand for dairy substitutes can be attributed to the expanding vegan community and heightened awareness of lactose intolerance. Vegan dairy alternatives offer a wealth of benefits, including ample fiber, antioxidants, and valuable plant-based compounds. They are also abundant in essential nutrients such as potassium, magnesium, folate, as well as vitamins A, C, and E.
The primary catalyst for growth in the dairy substitute category within the global vegan food market stems from the rising consumption of plant-based milk products. Additionally, the increasing prevalence of lactose intolerance is expected to fuel the demand for vegan food, consequently propelling the growth of the dairy substitute segment throughout the forecast period (2023-2027).
Vegan meat or meat alternatives, also known as meat-free products are crafted entirely without animal-derived ingredients. Typically, these items are composed of ingredients like soybeans, tapioca, vegetables, tempeh, pea protein, and other plant-based components.
The introduction of innovative products and heightened investments from vegan market players will drive the expansion of the vegan industry. Furthermore, major players within the traditional food and beverage industry are diversifying into the vegan meat sector, channeling resources into the development of vegan meat products.
Nonetheless, stringent regulations governing the labeling of vegan meat items may pose a challenge to the growth of the vegan food market during the forecast period (2023-2027). See paragraph below.
Key Players
Businesses are deploying a range of tactics, including strategic alliances, collaborations, partnerships, mergers, acquisitions, geographic expansion efforts, and the introduction of new products or services, with the aim of bolstering their market presence.
Technovia has identified the following top players:
- Amys Kitchen Inc.
- Bega Cheese Ltd.
- Beyond Meat Inc.
- VBites Foods Ltd
- Blue Diamond Growers
- Danone SA
- Earths Own Food Co. Inc.
- Eden Foods Inc.
- First Grade International Ltd.
- Fresh Start
- Living Harvest Foods
- Maple Leaf Foods Inc.
- Organic Valley
- Otsuka Holdings Co. Ltd.
- PANOS Brands LLC
- Ripple Foods PBC
- Saputo Inc.
- SunOpta Inc.
- The Hain Celestial Group Inc
- Tofutti Brands Inc
Challenges
The challenge facing the market revolves around both high pricing, limited awareness and regulations and labeling.
In regions under development like the Middle East and Africa (MEA), Asia-Pacific (APAC), South America, and Europe, the elevated cost of vegan food in comparison to traditional dairy or meat products stands out as a significant barrier hampering its widespread acceptance. Moreover, even in developed countries, individuals with moderate incomes tend to shy away from purchasing vegan food due to its premium pricing. The cost per pound of vegan food can vary substantially depending on the brand offering, often commanding prices 1.5 to 2 times higher than conventionally processed alternatives.
Despite the global expansion of the vegan food market, there remains a notable lack of awareness among consumers, particularly in regions such as South America, Southeast Asia, MEA, and Eastern Europe. Consequently, these regions have underdeveloped vegan food markets with minimal market penetration. This issue is particularly concerning for industry players since these areas account for more than two-thirds of the world's population. As plant-based meat rises in popularity, not everyone is happy with the increased competition.
All over the world, the meat lobbies have advocated for laws that restrict how plant-based meats may be labeled. The new laws, with little differences among countries, prohibits producers of plant-based meat alternatives from marketing their foods using words signifying any kind of meat or meat product.
This means that even common meat signifying terms such as “veggie burgers,” “vegan steak”, “plant-based sausage”, “hot dogs,” “chorizo,” and “jerky” are banned. “Milk” and “cheese” are being banned too.
The plant-based-meat companies argue that the labeling laws are a restriction on commercial speech that prevents them from sharing truthful and non-misleading information about their products, does nothing to protect the public from potentially misleading information, and creates consumer confusion where none existed before in order to impede competition.
To continue selling their vegan foods business would be forced to print special expensive labels, to buy memberships in vegan labelling associations, to use names without the words consumers are looking for when they shop for meat/milk/cheese/eggs alternatives. This would be extremely costly, burdensome and would likely confuse consumers.
These factors are expected to act as hindrances to the growth of the global vegan food business market until 2027. Nonetheless, veganism is a roaring tidal wave of change, an unstoppable force sweeping across the culinary landscape and a vibrant revolution for our plates and planet alike.