A new report on the future of dairy released by the food tech accelerator Eatable Adventures calls for industry leaders to adopt forward-thinking practices and integrate plant-based, fermented, and cell-based dairy innovations for better sustainability and efficiency.
The report highlights three main areas to transform the industry: moving toward more sustainable practices, developing and adopting hybrid products (combining traditional and alternative ingredients), and forming strategic innovation partnerships to drive these changes successfully.
Scaling emerging technologies
However, the study, which compiles insights from medium to large dairy companies across Europe, Latin America, and Asia, has found that the industry is divided on adopting new technologies. Industry leaders pointed out that competition presents a primary challenge to adopting these technologies within the traditional dairy sector and from innovative startups.
The report underscores the importance of collaboration between corporations, startups, universities, and research centers to drive open innovation and tackle industry challenges to overcome competition.
Partnerships allow for sharing external expertise, fostering technological advancements, and enhancing sustainability across economic, social, environmental, and nutritional dimensions. Nonetheless, aligning goals between corporations and startups is challenging due to differences in culture, scale, and timelines for development and market entry, says the report.
“Industry leaders must actively shape the future rather than merely observe it”
José Luis Cabañero, founder and CEO of Eatable Adventures, comments, “These partnerships enable startups to scale faster while providing corporations with efficient access to new technologies. Success in the sector depends on the ability to scale emerging technologies, achieve price parity, and meet evolving market demands.”
Insights from the dairy industry
The global dairy industry was valued at $944 billion in 2023 and is projected to grow to $1.3 trillion by 2030, according to data from IMARC Group. Over 80% of the world’s population consumes dairy products regularly, with global milk production surpassing 950 million metric tons in 2023.
However, the dairy industry faces climate change, labor shortages, fluctuating prices, and evolving consumer demands. Millennials and Gen Z increasingly focus on planetary health, which is affecting their dietary choices. Meanwhile, reducing greenhouse gas emissions to achieve sustainability is a top priority for many dairy companies, the survey found.
According to surveyed stakeholders, the dairy industry is advancing technology and innovation within the food sector to position itself as a central force in promoting food sustainability and resilience. The industry is developing guidelines and policies to address these environmental concerns while adapting to the broader impacts of climate change on dairy farming.
Consolidation of plant-based alternatives
A significant focus of the report is the consolidation of plant-based alternatives in the dairy market, showing that plant-based milk options, including soy, oat, coconut, and nut-based products, have become mainstream, reflecting shifts in consumer preferences and a greater emphasis on sustainability.
The global plant-based dairy market was valued at $12.6 billion in 2023 and is expected to double to around $26 billion by 2030, according to the report. Investment in plant-based dairy peaked in 2020-2021 but has since declined by over 90%. The Asia-Pacific region dominates in plant-based dairy sales, significantly surpassing North America. Despite this surge, traditional dairy products continue to maintain the majority share of consumer preferences. Notably, over a third of consumers have tried plant-based alternatives for the first time since 2020.
“Innovation not only positively impacts the planet but also promotes industry best practices and benefits consumers”
Advanced technologies like precision fermentation and cell-based are gaining momentum because of their potential as alternative dairy solutions. Meanwhile, molecular farming, plant-cell culture, and computational biology are quickly emerging as promising technologies to ” further revolutionize the dairy landscape,” says Eatable Adventures.
Cabañero adds, “This report outlines our vision for a technology-driven future for the food sector, where innovation not only positively impacts the planet but also promotes industry best practices and benefits consumers. Industry leaders must actively shape the future rather than merely observe it.
“We call on all stakeholders involved in this transformation to adopt forward-thinking practices and integrate cutting-edge technologies that enhance sustainability and efficiency.”
To explore the full findings, download the “Future of Dairy” report here.
