Don’t cry, but milk sales plummeted by $1.1 billion last year

Our obsession with milk alternatives–nut, soy, oat, rice, etc.–is taking a toll on the real thing.

The Dairy Farmers of America (DFA) announced that traditional milk sales plummeted by $1.1 billion in 2018. Last year’s net sales totaled $13.6 billion, compared to $14.7 billion in 2017.

The cooperative’s president and chief executive officer Rick Smith noted it has been a “challenging” year for the American dairy farmer community. While the organization partially blames low milk prices, industry insiders point to another culprit: increased consumer interest in plant-based substitutes.

The market for plant-based foods and beverages has grown at a dizzying pace. The global dairy alternatives market size was estimated at $11.9 billion in 2017, and analysts believe the market will exceed $34 billion by 2024. Returns on soy, rice, and almond milk are roughly 6% higher than those on traditional milk products..

The booming sector inspired a host of food startups capitalizing on consumers’ desires for healthier, eco-friendly purchases. Nut milk maker Califia Farms, for example, secured over $115 million in funding and plans to build out its plant-based product lines. Then there’s Oatly, the beloved oat milk brand that couldn’t keep up with public demand.

In the retailer space, Whole Foods recently launched make-your-own almond milk machines in select locations.

The changing dairy landscape inspired some traditional brands to innovate, while others attempt to prevent plant-based beverages from using the word “milk.” It’s an ongoing battle as farms claim newcomers hijack their marketing language and confuse shoppers.

Non-dairy manufacturers have yet to comply. Molly Spence, a spokesperson for the Almond Board of California, previously told Fast Company, “To us, this attempt to legislate the word ‘milk’ as dairy-only comes a little late, and doesn’t make sense considering plant-based milks have been around not only for several years but for centuries.”