COVID-19 Impact on Pharmaceutical Packaging in Chemicals and Materials Industry

COVID-19 Impact on the Non-dairy Beverages in Food and Beverages Industry

  • Food & Beverage
  • Oct 07, 2021

COVID-19 Impact on the Non-dairy Beverages in Food and Beverages Industry

The COVID-19 pandemic has affected the non-dairy beverages market significantly on a global level. The persistence of COVID-19 for a longer period has affected the supply and demand chain as it got disrupted due to the difficulty in supplying the ingredients for preparing non-dairy beverages products such as nuts, soya, and others. During the COVID-19 pandemic, the market witnessed a decline in the non-dairy beverages market initially due to movement restriction, de-globalization, loss of income, import and export restriction, and the supply of raw materials. All these factors have impacted the market growth negatively. The COVID-19 has led to the lockdown worldwide, which has impacted the non-dairy beverages market as the supply of non-dairy beverages has been affected. The prices of plant-based or vegan products also fluctuated, as the market faced a crisis.

Every sector in the beverages industry has been impacted either positively or negatively due to the COVID-19. The COVID-19 pandemic has introduced a lack of immunity amongst people around the globe. Hence, there is more demand for non-dairy beverages products to increase immunity and stay healthy.

Aftermath of COVID-19

After the outbreak of COVID-19, the consumers have become more conscious about the intake of beverages and are trying to consume beverages that are healthy and nutritious and offer various health benefits. An increase in awareness regarding the health benefits of consuming plant-based beverages instead of dairy will increase the demand for non-dairy beverages products. Initially, the demand and supply of non-dairy beverages products have decreased due to the movement restrictions, but later after the COVID-19 outbreak, the demand for non-dairy beverages increased owing to a change in lifestyle and change in consumption pattern of consumers around the globe. Also, with the growing awareness and growing social media vegan trends have influenced the global population, thereby increasing the growth of non-dairy beverages in the global market.

Increased Demand for Specific Food Products for Vegan and Vegetarian Diets

At the beginning of 2020, the pandemic has resulted in a drastic increase in the demand for healthy food. A popular trend in consumers is a shift to a vegan and vegetarian diet which is considered healthy. The vegan and vegetarian community also seem to be at a lower risk of diabetes, cholesterol, obesity, and other diseases.  As COVID-19 is at high risk for patients with obesity, the consumption of healthy and vegetarian non-dairy beverages such as plant/nut-based milk and others has increased in consumers. 

The recent trend indicates an exponential rise in consumption of vegan beverage products as consumers are making significant lifestyle changes for reasons such as promoting animal welfare, improving health and wellness, and prioritizing environmental sustainability. Responding to this transitional shift in consumer behavior, several food & beverage manufacturers have made substantial investments in launching new vegan beverage products in recent years. Further, the outbreak of the COVID-19 pandemic has accentuated the growth of vegan products as prices of animal-based products skyrocketed during the pandemic. As a result, the beverage industry will witness an increasing number of players entering the "vegan" space as consumer demand is likely to accelerate over the coming years.

Impact on Price

The non-dairy beverage grew at a slower pace, and the improving COVID situation allows for gradual re-opening of foodservice channels. Demand for non-dairy beverages remains steady, although disruptions due to the rapid spreading of COVID-19 into unvaccinated populations out of control in many regions, forcing many governments to re-impose restrictions. The non-dairy beverages market in upcoming years will increase over the prior year is partly due to the decline in trade caused by the impact of COVID port disruptions, but the ongoing surge in China's demand explains a large portion of non-dairy beverages products.

The price of the non-dairy beverage is high in comparison to the dairy beverage, as dairy products are largely used all over the world. For the processing of non-dairy beverages, the raw material and preparation methods increase the final product's price.

According to the manufacturers,

"Given that these products are priced significantly higher than regular dairy, their uptake is going to be limited as compared to dairy,"

-Rajat Wahi, partner, Deloitte India

"Consumers will not move entirely to plant-based milk; however, they will incorporate it in their diet given its health proposition,"

-Rohan Mirchandani, co-founder, and CEO of Drums Food (Epigamia)

"We want to reach price parity with private dairy players,"

-Abhay Rangan, founder, Goodmylk.

Thus pricing is the biggest hurdle for many players in the non-dairy beverage market.

Impact on Demand

During this crisis time, health has become an imperative issue for consumers. From making smaller changes such as a low-calorie and sugar-free diet to major lifestyle changes, consumers have prioritized health. As non-dairy beverages such as plant/nut-based milk are well known in vegan and other communities which are on some special diets, the consumption of these products is expected to increase during COVID-19 and after COVID-19.

For instance,

•    According to China Daily, in 2020, plant-based milk sales in China in convenience store chain Bianlifeng increased 10 to 13% in various locations

Thus, the pandemic had a positive impact on the demand, and there is a major shift in consumer's choice from animal-based milk beverages to plant/nut-based beverages in many regions around the globe.

Impact on Supply

The restriction imposed during lockdown has changed the mindset of the consumers and business enterprises towards the online shopping and e-commerce platform that has augmented the growth of the market. The partnership with online delivery platforms such as Alibaba, Amazon, and others has also supported the supply chain of the non-dairy beverages market. With social media and e-commerce providing a huge platform for major and minor non-dairy beverages manufacturers, the consumers have been abled with ordering and pick-up at their convenience or get their order shipped at their locations. Few companies have also developed their own e-commerce platforms that have benefitted their supply chain, which has enhanced the demand for non-dairy beverages.

Growing Awareness Regarding Non-dairy Beverages and Increasing Social Media Trends is Leading the Non-dairy Beverages Such as Plant/Nut-Based Products Market

The majority of the population around the world is turning vegetarian or either vegan, especially after the COVID-19 outbreak. With the growing awareness regarding the health benefits of consuming plant/nut-based products, lactose intolerance, and supporting the environment and animals due to the consumption of such products, the demand for non-dairy beverages such as plant/nut-based milk is on the rise. After the COVID-19, people all over are opting for non-dairy beverages as they got more incline towards leading a clean and healthy lifestyle. Increasing demand for non-dairy beverages has enabled manufacturers to raise investments for non-dairy beverages even during the COVID-19 in many regions across the globe.

For instance,

  • In August 2021, Silk launched its first new limited flavor, which is a blend of brown maple sugar in oat milk
  • In February 2021, Ripple Foods announced its Plant-Based Kids Milk, which is a 100% vegan milk alternative that is fortified to support optimal nutrition for kids of ages from one to five

An increase in the number of efforts by the manufacturers to gain investments for non-dairy beverages even in COVID-19 outbreak products to fulfill the consumers' growing demand for non-dairy beverages will drive the market growth in a positive direction.

Conclusion

COVID-19 pandemic has affected almost all industries, including the non-dairy beverages market. It has also affected the population and economy on the global level. During this pandemic, public awareness regarding clean, healthy, and nutritious food, which offers various health benefits, was on the rise. The majority of the population is also becoming aware of the benefits of consuming non-dairy beverages in the longer run. An increase in the vegan and vegetarian populations and raised investments for non-dairy beverages such as plant/nut-based products by manufacturers will drive the non-dairy beverages market positively.  Increasing demand for non-dairy beverages such as milk, yogurt, and others by the consumers will add to the market's growth. Consumers have been shifting their buying presences from offline to online retails to maintain social distancing. Thus, the market will increase after the COVID-19 outbreak and will grow for a long time due to changing social media trends, spreading awareness regarding clean and healthy food options, and changing consumers' preferences to lead a healthy and clean lifestyle.