The Expansion of Plant-Based Milk Markets in Japan

About Plant-based Milk

Many people worldwide are increasing their consumption of plant-based milk (alternative milk) due to concerns about ethics, the environment, and health. In this context, plant-based milk refers to alternative milks made from sources such as oats, soy, and almonds, which provide a variety of nutrients that are difficult to obtain from dairy milk (see Figure 1). The growing global interest in plant-based milk is evident in Figure 2. It shows that the per capita consumption of plant-based milk worldwide is expected to grow at an annual compound growth rate (CAGR) of 5.2% from 0.75 kilograms (kg) per capita in 2018 to 1.31 kg by 2028.

Figure 1. Types and Characteristics of Plant-Based Milk

Figure 2. Per-capita consumption of milk substitutes worldwide from 2018 to 2028 (in kg)

The recent popularity of plant-based milk is not only due to its variety of flavors and nutrient content but also because of growing consumer awareness about environmental and health issues. According to the study "Dairy vs. Plant-Based Milk: What are the Environmental Impacts?" conducted by Hannah Ritchie in (2022), plant-based milk produces only one-tenth of the carbon emissions during production compared to regular dairy milk.

Furthermore, plant-based milk is beneficial for consumers who cannot consume dairy milk due to lactose intolerance. The study "Country, Regional, and Global Estimates for Lactose Malabsorption in Adults" (2017) indicates that over 50% of the global population suffers from lactose intolerance, with particularly high rates in Asian countries (Figure 3).

Figure 3. Prevalence of lactose malabsorption in different countries

The Population in Japan

Looking at the global market size for plant-based milk, China holds the largest market share at 30%, followed by the United States (16.46%) and Japan (6.24%) (Figure 4). Particularly notable is Japan, where the market size has grown by 50% from 2016 to 2021. According to the United States Department of Agriculture (USDA), this increase is due to Japanese consumers' heightened awareness of environmental and health issues, leading to higher consumption of plant-based milk and other plant-based products. As Figure 5 indicates, the consumption of plant-based milk in Japan has been steadily increasing since 2018. With a CAGR of 9.11% from 2018 to 2023, it is expected to continue growing, reaching 881.29 million kg by 2028.

Figure 4. 2021 Market Size and Growth Trend of Alternative Milk by Country (Unit: Billion Dollars)

Figure 5. Volume of the Milk Substitutes Market in Japan from 2018 to 2028

In Japan, almond milk stands out as a popular choice among alternative milk options. As shown in Figure 6, the Japanese almond market size of $51.34 million in 2019 grew to $76.38 million by 2023 with a high CAGR of 8.41%. Referring to Figure 7, almond milk contains approximately one-fourth of the calories and lower carbohydrates compared to dairy milk for a 200 milliliter (ml) serving. It is also rich in Vitamin E, making it a popular choice among vegans. According to the Almond Milk Research Association, while the existing customer base was predominantly female, it is gradually expanding to include men and children. Manufacturers and other related businesses are positively responding by extending expiration dates to accommodate consumer demand, facilitating potential market expansion.

Figure 6. Market size of almond milk in Japan from 2019 to 2023

Figure 7. Almond milk and dairy milk nutritional profile comparison

Conclusion

Global interest in plant-based milk is growing due to increasing concerns about ethics, the environment, and health. Plant-based milk boasts a significantly lower carbon footprint in its production process compared to cow's milk and provides a variety of nutrients. This demand is particularly notable in countries like Japan, where the percentage of adults with lactose intolerance is relatively high.

The alternative milk market in Japan has been growing rapidly since 2018, with a notable increase in the consumption of almond milk among various plant-based milks. Compared to dairy milk, almond milk offers the benefits of being low in calories and carbohydrates and rich in Vitamin E. Initially favored by women, the consumer base has expanded to include men and children. Currently, Glico's 'Almond Koka' holds a significant market share, but imported products like 'Almond Breeze' from Blue Diamond Growers are also available through major Japanese e-commerce platforms such as Rakuten. Retailers and suppliers are keeping a close eye on the growth of the almond milk market in Japan, seeing it as an opportunity to tap into new market potentials.