Sales of plant-based food at retail grew three times faster than total food retail sales in 2021, according to data released Thursday by the Plant Based Foods Association (PBFA), The Good Food Institute (GFI) and wellness-focused data company SPINS.
Amidst turbulent economic conditions amplified by the pandemic, supply chain issues and inflation, the data shows U.S. retail sales of plant-based foods grew 6.2% in 2021 over a record year of growth in 2020, bringing the total plant-based market value to an all-time high of $7.4 billion.
"The sustained rise in the market share of plant-based foods is remarkable, and makes it clear that this shift is here to stay. More and more consumers are turning to plant-based options that align with their values and desire to have a positive impact on personal and planetary health,” said PBFA Senior Director of Retail Partnerships Julie Emmett.
She continued, “The data shows that, despite the challenges of the past two years, retailers and foodservice providers are meeting consumers where they are by partnering with brands across the entire store to expand space, increase assortment and make it easier than ever to find and purchase plant-based foods. The potential impact of these initiatives extends far beyond the store shelf: By taking consumer concerns to heart, the industry is actively embracing its role as a key driver of change that moves us closer to a secure and sustainable food system."
Plant-based milk and dairy
Dollar sales for plant-based milk, the largest category in the plant-based market, grew 4% and 33% in the past three years to reach $2.6 billion. Plant-based milk, which now accounts for 16% of all retail milk dollar sales, is the growth engine of the milk category, contributing $105 million in growth. Forty-two percent of households purchase plant-based milk, and 76% of plant-based milk buyers purchased it multiple times in 2021.
Plant-based milk continues to benefit from product innovation and expanded merchandising space and assortment. Almond milk is the category leader, accounting for 59% of the total category, and oat milk growth is the second-largest segment, growing more than 44 times in the past three years, now making up 17% of category sales, up from only 0.5% in 2018. Plant-based milk now serves as the innovation leader in the milk category, supported by key advancements in ingredient diversification and product development to improve taste, functionality, and nutrition.
The success of plant-based milk has laid the groundwork for major growth in other plant-based alternative-dairy products, which reached $2.1 billion in total sales in 2021. Categories like ready-to-drink beverages and plant-based creamers—which now has a 9% share of all creamers sold— experienced rapid growth as plant-based milk consumers increasingly entered these adjacent categories. In 2021, plant-based yogurt dollar sales grew 9%; plant-based cheese was up 7%; and plant-based ice cream and frozen desserts grew 31% over the past two years to reach $458 million.
After record growth in years prior, 2021 plant-based meat dollar sales remain strong, delivering a repeat year of $1.4 billion in sales, and growing 74% in the past three years. In 2021, plant-based meat's dollar share was 2.7% of retail packaged meat sales, or 1.4% of the total meat category (including random weight meat). Each of these plant-based meat share numbers increased 19% over the last two years. Nineteen percent of households purchased plant-based meat in 2021, up from 18% in 2020, with 64% of buyers purchasing plant-based meat more than once throughout the year.
Plant-based burgers continue to lead the plant-based meat category as the top-selling product type. At the same time, the industry is responding to consumer desire for more variety within the meat category. The fastest-growing plant-based meat product types in 2021 were plant-based meatballs, chicken nuggets, tenders, cutlets and deli slices. Plant-based chicken was a growth leader in 2021 as more products that match the taste, texture and appearance of animal-based chicken hit retail shelves. There remains a significant ongoing opportunity in plant-based seafood, which grew 14% to $14 million, but accounts for just 1% of the plant-based meat market.
"Product innovation is critical for plant-based categories to continue to earn a larger share of the market,” noted GFI Research and Analysis Manager Karen Formanski. “Getting more consumers to eat plant-based foods more often requires improved taste and texture to compete with animal products, more product diversity and greater affordability and accessibility. As businesses recognize the staying power of plant-based foods, the food industry must seize these opportunities to maximize the vast potential of plant-based alternatives to compete with animal products."
Certainly the demand for plant-based foods is there. Sixty-two percent or 79 million U.S. households are now buying plant-based products, an increase from 61% (77 million in 2020). Increased repeat rates in plant-based foods across numerous record-breaking years illustrate strong consumer commitment and interest — the percentage of consumers purchasing multiple times within the plant-based category grew from 78% in 2020 to 79% in 2021.
Millennials and Gen Z, which compose 47% of the population and will continue to grow in their spending power, have particularly high demand for plant-based foods. These generations are also increasing their e-commerce spending the most — and e-commerce sales of total plant-based foods grew 47% in the last year to $351 million, up from $240 million in 2020.
"Just when retailers were getting ahead of challenges from the pandemic and supply chain issues, record inflation is causing them to look at alternatives to help consumers manage their shopping and wellness journeys,” said SPINS Chief Commercial Officer Jay Lovelace. “SPINS data shows that plant-based products appear to be managing the economic issues in the U.S. better than many traditional retail products. This is a trend we expect to continue throughout this year and encourage retailers to look to expand shelf space for all plant-based products."