Coffee trends boosting oat milk’s popularity as demand for dairy-free alternatives surge

04 Dec 2020 --- Malt Products Corporation (MPC), a manufacturer of malted barley extract and natural sweeteners, is experiencing a surge in demand for its OatRite oat extract as an attractive sweetener for the burgeoning oat milk market.

The spike in inquiries stems from the global boom for oat milk as the fastest-growing milk alternative, combined with increased consumer interest in pantry-friendly food labels featuring non-GMO, plant-based and multi-functional ingredients, the company asserts.

Speaking with FoodIngredientsFirst Amy Targan, president of MPC, says the rate at which oat-based beverages have grown in popularity “has been somewhat surprising, but in retrospect, it makes sense that oat would be a hit.”

“It’s healthy and sustainable and makes no sacrifices when it comes to flavor. We think this growth will continue for a long time,” she forecasts. 

“Meanwhile, while consumer preference moves away from dairy, oat milk is coming out at the top as it “is most similar to dairy in texture and taste.”

Consumers who are lactose intolerant, vegan, or diet-conscious gravitate toward oat milk as the best alternative to cows’ milk, says Amy Targan (pictured).Oat appeal 
Oat milk has “at least as much calcium as cows’ milk but far less fat and no cholesterol,” according to Targan. “It is also more sustainable to produce than other milk substitutes such as soy and almond milk, a factor that is becoming more important to grocery shoppers today.” 

Consumers who are lactose intolerant, vegan, or diet-conscious gravitate toward oat milk as the best alternative to cows’ milk. “Oat milk is especially popular as a coffee creamer for this reason,” flags Targan. 

“The same goes for people with certain food allergies,” she says.  

Soy and almonds – which are “legacy” sources for dairy substitutes – are also relatively common allergens. Oat milk is, therefore, an ideal product for people with those kinds of allergies or sensitivities.

Ultimately, however, the flavor profile of oat milk is mild and familiar. “This translates into broad appeal for all kinds of consumers and all kinds of applications,” Targan adds. 

Oat milk has quickly taken its place among the most popular dairy milk alternatives, showing explosive growth in just a handful of years since first hitting retail shelves. 

This sudden rise to prominence also includes a 350 percent year-over-year sales increase, with sales anticipated to approach US$300 million in 2020. 

A sweet pair
OatRite recently gained market share as a plant-derived sweetener for non-dairy beverages. 

According to MPC, OatRite extracts are made from whole grain oats minimally processed in a state-of-the-art plant, producing a syrup with a mild sweetness and pleasant oat taste and aroma.

Naturally high in protein, minerals, soluble fiber and antioxidants, the non-GMO sweetener offers nutritional benefits, and has several functional assets, including improved texture and extended shelf life. 

These characteristics are unmatched by sugar or refined syrups prominently used in traditional sweeteners.

Working with oatOat extract is easy to work with and is a good source of vitamins, protein, fiber and minerals.
Oat milk manufacturers choosing oat extract also enjoy a highly sought-after benefit: label simplification. For oat milk, OatRite represents an attractive single-ingredient sweetener that, like oat milk itself, enjoys a positive association with health-conscious consumers.

“Oat milk and especially oat extract are straightforward ingredients to work with,” Targan comments.

“It also has a long shelf life, is readily soluble, and is easy to incorporate into existing production processes. The biggest challenge is optimizing the production of the oat extract itself to capture the right profile of carbohydrates and other solubles.”

“This is essential to creating a product that has sufficient ‘body’ and smooth texture,” she adds. 

Plant-based consumption puts focus on oat ingredients 
According to data from Innova Market Insights, three in five global consumers claim to incorporate more plant ingredients in their diets.  

This is in line with Innova Market Insights’ second Top Ten Trend of 2021, “Plant-Forward,” highlighting the continued development and evolution of the plant-based sector.

Plant-based innovation is also diversifying and seen in more subcategories than a few years ago – and this includes dairy and desserts. 

Dairy alternative drinks sales grew at 9.6 percent CAGR 2015-2019 in North America. Vanilla and milk chocolate are the top flavors in the US and Canada in dairy alternative drink NPD between 2017-2019. Moreover, gluten-free is the top positioning for alternative dairy beverages in North America 2017-2019.  

Average annual growth in F&B launches with selected claims (Global, CAGR 2015 to 2019) shows an 8 percent rise for vegetarian claims, a 23 percent increase for vegan claims. However, the most significant jump is in plant-based claims, which have gone up by 57 percent. 

According to Targan, there is still a lot of untapped potential for oat. “The growth of oat milk products in recent years has been impressive, and there is still plenty of room for that growth to continue,” she flags. 

Hybrid beverages
Moreover, there seem to be opportunities for hybrid beverages that include both oat and other plant-derived ingredients. 

“This is actually one of the most promising avenues for growth. Coffee shops were one of the ways the public first got to try oat milk, and it was a hit because its flavor and texture complemented coffee so well. There ought to be a lot of untapped potential in that area, too,” explains Targan. 

For instance, Starbucks and Dunkin’ introduced oat milk as part of their menu options, and according to Beverage Industry, oat milk has now surpassed soy milk in consumer preference for the first time. 

In addition, oat extract (the base for oat milk) is easy to work with and is a good source of vitamins, protein, fiber and minerals. “This makes it an ideal ingredient for new formulations or new variations on existing beverages,” she continues. “The nutritional profile of oat extract is attractive to consumers, especially now that they are starting to look for alternatives to sugary soft drinks.”

Oat milk has quickly taken its place among the most popular dairy milk alternatives.Testing, testing
Oat milk is just one of many F&B applications with which MPC customers can experiment through its Innovations Lab. 

The new space is designed for MPC customers to test ingredients, try new formulations and gain insight into critical flavor and stability properties. 

The lab incorporates a variety of recent infrastructure investments, including ovens, mixers, shearers, proofers and temperature-controlled incubators, and analytical equipment such as spectrometers and instruments monitoring water activity and rheology. 

Projects involving oats
Transforming waste streams into value-added, premium ingredients is also on the rise. 

One move in line with this is an innovation from Renewal Mill, a US-based start-up specializing in “oat okara” – a nutritious flour made from the oat pulp leftover through oat milk production.

In January, alongside several academic partners PepsiCo analyzed how to make the “perfect oat.” 

Backed by the UK government’s Innovate agency, the “Opti-Oat” project has used technology to analyze hundreds of crops, collecting over one million data points. 

This resulted in the Oat Growth Guide, pegged as the “world’s first” benchmark for creating the perfect oat and guidance on nurturing it.

By Elizabeth Green