Europe’s vegan meat and dairy market is expected to reach €7.5 billion by 2025.
The plant-based meat and dairy markets are small, but fast-growing. Retail sales increased by about 10 percent between 2010 and 2020. According to the report, conducted by Dutch multinational banking firm ING, meat and dairy alternatives are expected to maintain the same growth rate over the next five years.
An influx of new products and shifting consumer eating habits are driving the growing market. A previous report by ING found that one-quarter of Europeans anticipated a reduction in their meat consumption, tied primarily to health, environmental, animal, or financial reasons.
Meat and dairy consumption has reached its peak in the EU, according to projections from the European Commission. However, the plant-based meat and milk markets still face three major challenges: cost, taste and texture, and availability.
Partial price parity with meat and milk, a popular topic among leaders in the plant-based food space, is also expected within the next five years. The report notes that scaling up and more private label supermarket products will bring vegan meat and milk closer in price to the animal-based versions.
The report notes that introducing emerging protein sources such as pea protein may improve consumer preferences toward plant-based meat. The low-impact protein source is gaining traction in the protein space due to its functionality. California-based food technology company Beyond Meat uses it to make products that cook and taste like real meat, including the Beyond Burger. Investing in the pea protein supply chain will further strengthen the market.
Who’s Leading the Plant-Based Food Market?
The UK is the most developed market. Total retail sales amounted to €440 million in 2019, followed by France, Germany, and the Netherlands.
Previous reports by global analytics firm Mintel reflect this. The UK launched more new vegan food products than any nation in 2018. Private label supermarket brands, such as Tesco’s Wicked Kitchen, have driven much of the growth. Initiatives including Veganuary and Meat-free Mondays have further encouraged people to eat less meat. As many as one in six new products launched in 2018 had a vegan label claim.