U.S. Plant-Based Food Retail Sales Reach $7.4B
Amid unsettled economic conditions exacerbated by the pandemic, supply chain issues and inflation, new data from the Plant Based Foods Association (PBFA), The Good Food Institute (GFI) and market research firm SPINS revealed that U.S. retail sales of plant-based foods grew 6.2% in 2021 on top of a record year of growth in 2020, bringing the total plant-based market value to an all-time high of $7.4 billion.
Overall, plant-based food retail sales grew three times faster than total food retail sales, with most plant-based categories surpassing their conventional counterparts. Meanwhile, the conventional protein market has experienced supply chain disruptions and rising inflation. Conventional meat dollar sales grew three times faster than its unit sales over the past three years, indicating that the apparent growth is driven solely by price increases.
Plant-Based Milk
Plant-based milk dollar sales increased 4% and 33% in the past three years to hit $2.6 billion, while animal-based milk sales fell 2% in 2021. Now accounting for 16% of all retail milk dollar sales, plant-based milk is the growth engine of the milk category, contributing $105 million in growth, while animal-based milk’s decline equated to a loss of $264 million. In the Natural Enhanced Channel, plant-based milk makes up 40% of all milk sold, up from 34% in 2018. Forty-two percent of households buy plant-based milk, and 76% of plant-based milk buyers bought it several times in 2021.
As the biggest category in the plant-based market, plant-based milk continues to benefit from product innovation, and greater merchandising space and assortment. Almond milk is the category leader, accounting for 59% of the total category, with oat milk the second-largest segment, having grown more than 44 times in the past three years to now make up 17% of category sales, up from just 0.5% in 2018. Plant-based milk is now the innovation leader in the milk category, backed by key advancements in ingredient diversification and product development to enhance taste, functionality and nutrition.
The success of plant-based milk has laid the groundwork for significant growth in other plant-based dairy products, which attained $2.1 billion in total sales in 2021. Categories such as ready-to-drink beverages, and plant-based creamers — which now has a 9% share of all creamers sold — saw rapid growth as plant-based milk consumers increasingly moved into these adjacent categories. Across the store, plant-based dairy dollar sales are growing more quickly than those of many conventional animal products. In 2021, plant-based yogurt dollar sales rose 9%, three times the rate of conventional yogurt, to a 4.5% dollar share. Plant-based cheese grew 7%, while conventional cheese decreased 2%, and plant-based ice cream and frozen desserts increased 31% over the past two years to reach $458 million. In the Natural Enhanced Channel, where retail trends start, dollar share of plant-based creamers rose to 33% of all creamers sold, while plant-based yogurt increased to a 21% share of all yogurt.
Plant-Based Meat
Following record growth in earlier years, 2021 plant-based meat dollar sales remain steady, delivering a repeat year of $1.4 billion in sales, and rising 74% over the past three years, nearly tripling the growth of conventional meat. The unit comparison is even more striking: While conventional meat unit sales have increased 8% in the past three years, plant-based meat unit sales have outpaced that by more than six times, rising 51% during the same period. Last year, 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 grew 19% over the past two years. Plant-based meat’s share of meat in the Natural Enhanced Channel is currently 14%. Nineteen percent of households bought plant-based meat in 2021, up from 18% in 2020, with 64% of buyers buying plant-based meat more than once during the year.
Plant-based burgers continue to be the top-selling product type in the plant-based meat category. At the same time, the industry is meeting consumer desire for more variety within the category, with the fastest-growing plant-based meat product types in 2021 plant-based meatballs, chicken nuggets, tenders and cutlets, and deli slices. In fact, plant-based chicken was a growth leader in 2021 as more products that approximate the taste, texture and appearance of animal-based chicken arrive in stores.
There’s a big ongoing opportunity in plant-based seafood, which grew 14% to $14 million, but accounts for just 1% of the plant-based meat market, versus conventional seafood comprising a fifth of total meat and seafood sales.
Over the past few years, the food industry has experienced various supply chain disruptions and widespread volatility. Notably, after an overstimulated 2020, the unit sales of almost every single animal-based category saw negative growth in 2021, and to a lesser extent, so did a few select plant-based categories. Conventional meat dollar sales grew three times faster than its unit sales over the past three years — a result of inflation — indicating that this apparent growth was caused by higher unit prices. Further, IRI’s inflation index showed that in March 2022, U.S. retail conventional meat price per unit was up 13% compared with March 2021, while plant-based meat price per unit was down 2%. With the rapid scale-up of the plant-based industry, plant-based products may soon be able to compete with animal products on price, further stoking consumer demand, according to PBFA and GFI.
Plant-Based Eggs
The plant-based egg category also grew quickly in 2021, with a 42% increase in dollar sales. Over the past three years, plant-based egg dollar sales have risen more than 1,000%. Further, with conventional egg dollar sales declining 4% in 2021, plant-based eggs have grown to earn a nearly 0.6% share of the total egg market, versus a 0.05% share three years ago, making plant-based eggs a growth driver of the category.
Currently, 62% of U.S. households (79 million) are purchasing plant-based products. This is an increase from 61% (77 million in 2020). Higher repeat rates in plant-based foods across numerous record-breaking years show strong consumer commitment and interest — the percentage of consumers purchasing several times within the plant-based category rose from 78% in 2020 to 79% in 2021.
Millennials and Gen Z, which comprise 47% of the population and whose spending power will continue to grow, are especially interested in plant-based foods. These demographics are also boosting their e-commerce spending the most, and e-commerce sales of total plant-based foods increased 47% in the past year to $351 million, up from $240 million in 2020. Consumers, particularly Millennials and Gen Z, want to buy foods that are better for their health and deliver on positive environmental impact and social responsibility. Plant-based brands and retailers are readily responding to such trends with innovative products and solutions.
“The sustained rise in the market share of plant-based foods is remarkable, and makes it clear that this shift is here to stay,” noted Julie Emmett, senior director of retail partnerships at San Francisco-based PBFA, the only trade association in the United States representing more than 350 of the nation’s major plant-based food companies. “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. 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.”
“Product innovation is critical for plant-based categories to continue to earn a larger share of the market,” observed Karen Formanski, research and analysis manager at Washington, D.C.-based GFI, a nonprofit think tank working to make the global food system better for the planet, people and animals. “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.”
“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 Jay Lovelace, chief commercial officer at SPINS, which is based in Chicago. “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.”
To size the U.S. retail market for plant-based foods, GFI and PBFA commissioned retail sales data from SPINS, which built the dataset by first pulling in all products with its “plant-based positioned” product attribute. The dataset was further edited by adding plant-based private label categories and subcategories, and refining the plant-based egg category. Inherently plant-based foods, such as chickpeas and kale, weren’t included. SPINS obtained the data over the 52-week, 104-week, 156-week and 208-week periods ending Dec. 26, 2021, from the SPINS Natural Enhanced and Conventional Multi Outlet (powered by IRI) grocery channels. To understand consumer purchasing dynamics and demographics, GFI and PBFA also commissioned consumer panel data from SPINS based on the same custom plant-based categories. SPINS acquires its panel data through the National Consumer Panel, a Nielsen and IRI joint venture comprising about 100,000 households. SPINS obtained the data over the 52-week period ending Dec. 26, 2021, and the 52-week period ending Dec. 27, 2020, from all U.S. outlets.
Earlier this month, GFI data found that 2021 was a record period of investment in companies creating sustainable alternatives to conventional animal-based foods. Alternative-protein companies have raised nearly $11.1 billion in invested capital since 2010, 73%, or $8 billion, of which has been raised since 2020, when the coronavirus first affected global markets.
