Coconut ‘milk’ alternatives have been a fixture in the plant-based beverage movement, supporting the growth of the global coconut products market. Health-conscious consumers looking to cut back on dairy are driving this trend in North America and Europe particularly.
But the global coconut products industry can be divided into coconut ‘milk’ powder and coconut ‘cream’ powder. They are used in more than just beverages, like salad dressings, Asian soups, curries, seasoned rice, pancakes, chocolate products, milkshakes and jams.
According to a new report from Future Market Insights (FMI), the nutritional value of coconut ‘milk’ products coupled with their long shelf life make them ideal for food processing manufacturers, who struggle to maintain food health and quality through heavy processing.
Consumers enjoy coconut products because they are rich in iron and used as ingredients in products that can help prevent anemia. They also have antiviral and antibacterial properties that help build up immune strength.
FMI projects that global coconut ‘milk’ products will grow at a CAGR of more than 7% between 2018-2028, generating revenue of more than $500m.
“The worldwide prevalence of lactose intolerance and dairy allergies is increasing. More than 65% of the global human population has a reduced ability to digest lactose,” FMI said.
“Some of the major drivers for the demand of dairy alternatives are an increase in the frequency of lactose intolerance and dairy allergies, preference for plant-based alternatives, and increase in calorie-related concerns. Therefore, the demand for coconut milk products is estimated to increase, as they are a plant-based dairy alternative, and provide various health benefits.”
Packaging pros and supply cons
Their use in bakery products like cookies, cakes and pies is growing in popularity in the Asia Pacific region, which will be responsible for a large chunk of the market in the next decade. Coconut in bakery is already a strong, established category in North America and Europe, according to FMI.
The two are positioned as more ‘attractive investment pockets’ for manufacturers in the global coconut ‘milk’ products industry. North America’s coconut powder market is projected for high growth rates in the next decade, while South Asia is expected to maintain its major share and dominance in the market.
Packaging for coconut ‘milk’ products take up relatively small space while in powder form, making them cheaper and easier to store and transport. FMI says this, along with their long shelf lives and convenient packaging compared to cow’s milk, will continue driving interest from both food processors and consumers.
But it can still be a tricky market, one that requires a constant supply of raw materials to meet consumer demand.
“Changes in the weather conditions can have a negative impact on the production of coconuts. A decrease in production capacity would further affect the prices of the required raw materials, which would not be economically feasible for companies,” FMI said.
“This would further increase the prices of coconut milk products, and thus, the shortage of raw materials is anticipated to serve as a restraint for the growth of the coconut milk products market.”