Plant-Based Food & Beverages Market Trends

Navigating the Plant-Based Food & Beverages Market Landscape

In 2023 the plant-based foods and beverages market is experiencing significant change, driven by a confluence of macro-factors. Technological advances in food processing and ingredient development are improving product quality and variety, making plant-based products more attractive to a wider audience. Regulations encouraging the development of sustainable food systems are driving companies to invest in plant-based alternatives. Meanwhile, changing consumer behaviours, characterised by an increased focus on health, environment and ethics, are reshaping the market. These trends are strategically important for companies as they navigate an evolving landscape of innovation, regulation and consumer engagement.

Top Trends

1. Increased Investment in Plant-Based Innovation
   Plant-based food is a growing area of food research and development. In 2022, the total R&D investment will exceed $1 billion. This is largely driven by consumer demand for healthier products: over 60% of consumers are actively looking for plant-based alternatives. Tyson Foods is diversifying its portfolio with more plant-based products, a clear shift in focus. The future may bring a number of developments, including improved formulations and new plant-based categories.
2. Sustainability as a Core Value
   With a 75% priority given by consumers to the purchase of products with a low impact on the environment, sustainable development is becoming a major driving force in the production of plant-based foods. Industry leaders are adopting practices such as the use of regenerative agriculture for the supply of raw materials. For example, Danone has set itself the target of reducing its carbon footprint by 30% by 2030. In the coming years, this trend will lead to an increase in the number of companies with transparent supply chains and eco-labelling, which will enhance brand loyalty.
3. Expansion of Plant-Based Dairy Alternatives
   The market for plant-based dairy products is growing fast, and almond and oat milks are the biggest sellers. Sales of plant-based dairy products rose by 20 percent in 2022, according to industry reports, driven by the desire for lactose-free dairy alternatives. In response, companies like Nestlé are expanding their ranges of dairy alternatives. Taste and texture are also being improved, which will appeal to consumers of dairy products.
4. Health and Wellness Focus
   Health-conscious consumers are increasingly turning to plant-based foods for their perceived health benefits. Some 70% of consumers believe that these foods are healthier. General Mills has launched several health-conscious plant-based snacks to meet this demand. This trend is likely to result in more and more functional plant-based foods with added health benefits such as fortified nutrients or probiotics.
5. Emergence of Clean Label Products
   In recent years, consumers have demanded greater transparency from food producers. 65% of consumers prefer products with a simple and recognizable list of ingredients. And this is where companies like Amy’s Kitchen are stepping in with their clean label, plant-based meals. And as a result, food producers are reformulating their products to meet clean label standards. This may result in a reduction in the use of artificial preservatives and additives.
6. Plant-Based Meat Alternatives Gaining Traction
   In 2022 the market for plant-based meat alternatives will have increased by a quarter. The leading companies are developing improved taste and texture, and Clara Foods is working on egg alternatives. This will attract both flexitarians and meat-eaters and make people more accepting of plant-based meats in their everyday diets. In the future, the development of meat from a laboratory may be included.
7. Culinary Innovation and Global Flavors
   Plant-based products are increasingly incorporating global flavours, appealing to consumers with a wide range of tastes. A recent survey shows that 40 per cent of consumers are interested in trying international plant-based dishes. This trend is likely to continue as companies like Premier Foods launch products inspired by the world’s cuisines. This trend could lead to the development of fusion plant-based products, offering consumers even more choice.
8. Rise of Plant-Based Snacks
   Plant-based snacks are gaining in popularity, with a projected increase in sales of 3 percent in 2022. These snacks are proving popular with consumers who are looking for convenient, healthier options. This trend is likely to lead to innovation in the formulation of snacks, with a greater variety of flavours and textures. There may also be greater use of superfoods in snack products.
9. Increased Availability in Mainstream Retail
   Plant-based foods are becoming more and more accessible, with more than 80% of food shops now selling them. In this change of trend, the consumer’s call is being met, and companies are working together with retailers to get more space on the shelves. This trend will probably continue as more and more people are adopting plant-based diets. This will lead to a stronger competition between brands and, perhaps, lower prices.
10. Focus on Functional Ingredients
    There is a growing interest in plant-based foods that offer health benefits, with 55% of consumers looking for products with added nutrients. This is driving the development of new products enriched with probiotics, fibre or other nutrients, as is the case with the new ranges of Keystone Natural Holdings. This trend is likely to lead to a greater variety of plant-based foods with added nutrients to cater for health-conscious consumers.

Conclusion: Navigating the Plant-Based Market Landscape

The competition in the market for plant-based foods is becoming increasingly fragmented, with established players and new entrants all vying for consumers’ attention. The trend towards a greater interest in plant-based foods is reflected in the consumption figures for North America and Europe. In Asia-Pacific, the market is beginning to move at a faster pace. The strategic positioning of food companies in this market is a question of deploying the latest digital technology in order to provide consumers with the best possible products and services. In the future, it will be essential for companies to be able to rely on artificial intelligence to gain a deeper understanding of consumers, automation to ensure efficient production and sustainable practices to meet consumers’ expectations. Also, as tastes and dietary preferences continue to change, it will be necessary to maintain the flexibility of the range of products on offer. These developments will create new opportunities for companies that can successfully combine these different capabilities. In the coming years, these will be the companies that will be able to seize the initiative and lead the way in this market.