Nutrition

Will Market Drivers for Dairy Alternative Ice Cream Also Benefit U.S Soy?

Can the plant-based evolution of ice cream help increase the market for U.S.-grown soybeans? Consider that ice cream, including dairy alternative versions, seems to be a worldwide food for the times, meeting customer demands on several levels. During the challenges of a global pandemic, consumers continued to demonstrate their fondness for experimenting with flavors, indulging in small food luxuries, and embracing new takes on traditional treats. With shoppers gravitating toward foods that offer comfort and promote feelings of well-being,[1] it is not surprising that sales of ice creams and frozen novelties eaten at home increased by 16.3% from 2019 to 2020.[2]

Health considerations play a role in today’s food choices as well. An average of 32% of consumers surveyed in nine countries say they buy dairy alternatives because they consider them to be healthier, and 27% do so because they seek variety in their diets.[3] Whatever the buying motivations, plant-based ice creams represent a growing product category that offers opportunities for U.S.-grown soy.

What’s the business outlook for the dairy alternative ice creams?

Manufacturers are increasing their product range by including functional ingredients, specialty fillings and exotic flavors in product formulations that meet changing consumer demands.[4] Nondairy lines of ice cream now make up 10% of all ice cream product introductions, with the category accounting for one quarter of the activity in North America, and one-fifth of product launches in Australia.[5] Dairy free ice creams in the U.S. grew 20% in 2020, reaching $435 million in sales.[6]

New product innovations during the pandemic suggest that consumers have remained motivated to explore new taste experiences. For example, one U.S. company’s line of frozen mochi novelties—including five nondairy varieties—occupied the number 15 slot among the year’s top food and beverage product introductions in 2020.[7]

Marketing creates opportunities to promote advantages of soy as a dairy alternative

In an era when dairy alternatives play into a variety of global food and health trends, soy holds its own among competitors when it comes to nutrition. In the U.S., fortified soy beverages and soy yogurt are the only plant-based milk alternatives considered to be a dairy equivalent according to the 2020-2025 Dietary Guidelines for Americans.[8]  Soymilk-based frozen dessert products are now found among the choices in the ice cream section of most grocery stores, in flavors ranging from the ever-popular vanilla to store specialties such as cherry chocolate chip.

Many shoppers consider ice cream to be a snack option as well as a dessert, driving growth of the take-home market segment.[9] For example, in 2017, 49% of urban Chinese consumers reported eating ice cream as a snack at home.[10]  In the U.S., the 2020 retail market for plant-based foods (including meat and dairy alternative products) increased by 27% over the previous year—a rate nearly two times greater than total retail food sales, that demonstrates broad appeal.[11]

Food allergies may also affect consumer product choices in the frozen desserts category. More than 160 foods can cause allergic reactions in those who have food allergies, with eight foods accounting for 90% of reactions: In order, they are milk, eggs, fish, crustacean shellfish, tree nuts (such as almonds, pecans and cashews), peanuts, wheat and soy.[12] Data suggests that one in ten U.S. adults have food allergies, with milk allergies affecting an estimated 4.7 million U.S. adults,[13] tree nut allergies affecting 3 million, and soy allergies affecting 1.5 million. Soy-based ice creams are a viable choice for those who want dairy alternatives, or who have tree nut allergies.  

Looking forward

The definition of comfort food is evolving to include global flavors and healthy options that make consumers feel better.[14]  The category of nondairy ice creams has been booming, with flavors helping to boost the indulgent image.[15] For consumers who seek out world cuisine flavors and enjoy trying new foods, soy-based ice creams are well-suited to adventurous appetites. Examples include Indian-inspired cardamom or saffron flavors, new iterations of Chinese-style red bean ice cream and Brazilian tropical fruit flavors such as acai and pitanga fruit.

Post-pandemic, consumers are expected to continue reaching for familiar, comforting foods as well as accessible indulgences that offer opportunities for brands to connect.[16] U.S.-grown soy remains a well-positioned ingredient to satisfy cravings for the cool and creamy.

[1] What’s Trending in Nutrition Annual Survey of Dietitians

[2] Mintel, Ice Cream and Frozen Novelties, U.S., April 2021

https://reports.mintel.com/display/1045097/

[3] Innova Market Insights for 2020.

https://www.innovamarketinsights.com/press-release/dairy-alternatives-diversify-as-the-consumer-base-evolves

[4] Allied Market Research, “Ice Cream Market by Product Type; Global Opportunity Analysis and Industry Forecast, 2017-2023.

https://www.alliedmarketresearch.com/ice-cream-market

[5] Innova Market Insights on Nondairy Ice Cream.

[6] Plant Based Foods Association and Good Food Institute, SPINS data analysis, “U.S. Retail Market Data for the Plant Based Industry, 2021.

https://gfi.org/marketresearch/.

[7] IRI, “New Product Pacesetters,” June, 2021.

[8] USDA and HHS, Dietary Guidelines for Americans, 2020-2025.

https://health.gov/news/202012/usda-and-hhs-just-released-dietary-guidelines-americans-2020

[9] Allied Market Research, “Ice Cream Market by Product Type; Global Opportunity Analysis and Industry Forecast, 2017-2023.

[10] Mintel, “Consumption of Ice Cream as a Snack is on the Rise in China,” August 18, 2017.

https://www.mintel.com/press-centre/food-and-drink/chinese-consumers-increasingly-snacking-on-ice-cream

[11] The Good Food Institute and the Plant-Based Foods Association, “Plant-Based Food Retail Sales Reach $7 Billion,” April 6, 2021.

https://gfi.org/blog/spins-data-release-2021/

[12] USDA, Food Allergies.

https://www.fsis.usda.gov/food-safety/safe-food-handling-and-preparation/food-safety-basics/food-allergies#6.

[13] Gupta RS, Warren CM, Smith BM, Jiang J, Blumenstock JA, Davis MM, Schleimer RP, Nadeau KC. “Prevalence and Severity of Food Allergies Among US Adults.” JAMA Network Open 2019; 2(1):e185630.doi:10.1001/jamanetworkopen.2018.5630

https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2720064

[14] Datassential, “10 Trends to know in 2021.”

[15] Innova Market Insights, “Flavor is King, but Not the Only Trend in Ice Cream,”  March  2021.

https://www.innovamarketinsights.com/press-releases/

[16] Mintel, “Ice Cream and Frozen Novelties, Incl. Impact of COVID-19” report, April 2020.

https://reports.mintel.com/display/986922/

Linda Funk

President

Flavorful Insight

Linda Funk has more than 30 years’ experience with large food and beverage manufacturers and commodity associations, assisting clients in telling their stories.