Demand for non-dairy milk is growing fast among Ukrainians.
Today, it is no longer a surprise to see oat, almond, coconut or even buckwheat milk in local supermarkets. More Ukrainians are now trying to follow a healthy diet, fast for religious reasons or stop eating animal products.
The non-dairy milk industry promises to reach a value of $40 billion globally by 2024, according to various estimates. However, until recently, there was just one Ukrainian producer of plant-based milk.
Now, the second domestic producer has appeared on the market.
Fueled by rising domestic demand, local firm Vitmark – which has been producing juices, beverages, and baby food since the 1990s – decided to launch production of plant-based milk. In January, the company opened its 5-million-euro plant in Odesa Oblast.
Now, its non-dairy milk has already hit shelves in Ukraine’s supermarkets.
It took four years for Vitmark President Vitaliy Vinitsky to take this step, even though his company has been a confident local market player for years, boasting top beverage brands like Nestea, Jaffa, Chudo Chado and Nash Sik.
“We studied examples of successfully manufacturing such milk in Western countries for a long time, and ultimately decided that we were ready to implement this project,” Vinitsky said.
The pioneer in this market and Vitmark’s local rival, Loostdorf, began to produce alternative milk called “Ideal Nemoloko” (Ideal Not Milk) in 2018. At the time, the other three competitors on the market were foreign. They have a distinct disadvantage: Their price for a one-liter carton of non-dairy milk is, on average, twice as high as the Ukrainian version.
By contrast, locally produced non-dairy milk costs around $1.50-$2 per liter.
Growing market
While non-dairy milk’s popularity is growing in Ukraine, it has still not become an entirely mainstream product.
“Ukrainians, unlike Europeans and Americans, do not yet know much about the benefits of plant-based milk,” said Vinitsky.
He notes that this milk contains little or no sugar, has no lactose and is cholesterol-free. He is sure that his company’s milk will help to change this perception.
Vitmark is producing its non-dairy milk under the brand Vega Milk, which has 11 different flavors. It focuses on oat and buckwheat milk, producing more of that type because the company has to import ingredients for rice and almond milk. Beyond plain non-dairy milk, the company also offers milk with chocolate and strawberry flavors.
Vinitsky himself prefers non-flavored plant-based milk with his coffee.
According to Maks Fasteyev, a senior dairy market analyst at analytical portal Infagro, the world is moving toward non-dairy milk because more people are switching to plant-based diets for health or ecological reasons. Plant-based products have less cholesterol and their production doesn’t contribute to carbon dioxide emissions as much as animal husbandry.
“This is a significant trend in the Western world, which is already being observed in major cities of Ukraine,” said Fasteyev. “That is why Ukrainian manufacturers are going into this business.”
The expert believes non-dairy milk producers will become serious rivals for traditional milk producers in the future. So far, however, their impact on the market is minimal because plant-based milk is still more expensive than cow’s milk in Ukraine, and it is cow’s milk producers like Loostdorf who take on production of non-dairy milk to diversify their revenue sources.
Non-dairy milk has also faced some significant pushback in Ukraine. Celebrity doctor Evgeniy Komarovskiy – a figure similar to U.S. pediatrician Dr. Benjamin Spock – called plant-based milk nothing but “a newfangled fairy tale,” saying that traditional milk and milk products play a huge role in a balanced diet for both children and adults.
“Live calmly and eat ice cream, cottage cheese, make cheesecakes, pancakes, drink milk and kefir. Bon appetit!” wrote Komarovskiy in his blog on Feb. 15.
Export demand
In many countries, drinking alternative milk is becoming so popular that many dairy farms are simply closing.
For example, in the U.K. alone, nearly 1,000 dairy farms closed in 2013-2016 as the demand for cow’s milk dropped significantly, the BBC reported.
In 2018, nearly 3,000 cafes and grocery shops across the U.S. suffered from a supply shortage of plant-based milk produced by Swedish oat milk company Oatly due to its huge popularity, the Guardian reported. The company’s production had increased by 1,250% just in two years since 2016.
“How do we supply when the growth is this crazy?” Toni Petersson, CEO at Oatly, said back then.
In Ukraine, Vitmark’s Vinitsky forecasts that the domestic market for plant-based milk can reach an annual turnover of $80 million. Additionally, seeing a large demand abroad, local producers may begin exporting.
“We see great prospects for the export of our products,” Vinitsky said.
