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Oat Based Beverages Market Size, Share, Growth & Industry Analysis, By Type (Oat Milk, Oat-based Yogurt Drinks, Oat-based Smoothies and Shake, Others), By Nature (Organic, Conventional), By Sales Channel (Supermarkets/Hypermarkets, Convenience Store) and Regional Analysis, 2024-2031
Pages: 148 | Base Year: 2023 | Release: February 2025 | Author: Antriksh P.
An oat-based beverage is a plant-derived drink made primarily from oats and water, often enriched with vitamins, minerals, and other ingredients to enhance taste and nutritional value. It serves as a dairy-free alternative to milk, catering to consumers seeking lactose-free, vegan, or sustainable beverage options.
The production process typically involves milling oats, mixing them with water, enzymatic treatment to break down starches, and filtration to achieve a smooth texture. Oat based beverage are widely used in coffee, smoothies, cereals, and cooking applications, offering a naturally creamy consistency with a mild, slightly sweet flavor.
The global oat based beverages market size was valued at USD 854.9 million in 2023 and is projected to grow from USD 909.5 million in 2024 to USD 1,492.7 million by 2031, exhibiting a CAGR of 7.34% during the forecast period.
The growth of the market is driven by increasing consumer demand for plant-based alternatives and rising health consciousness. The shift toward dairy-free diets, supported by lactose intolerance and vegan lifestyles, has fueled market expansion.
Additionally, sustainability concerns and the lower environmental impact of oat production compared to dairy farming are driving consumer preference for oat based beverage, supporting market growth.
Major companies operating in the oat based beverages industry are PepsiCo, Danone, The Quaker Oats Company, Oatly Group AB, Pacific Foods, Alpro, Tetra Pak International S.A., Oy Karl Fazer Ab., TOATS OATS COMPANY, Drinks Brokers Ltd, PureHarvest, SIMANDL Spol. s ro, Califia Farms, LLC, and others.
The growing preference for plant-based diets is accelerating market growth. Health-conscious consumers are seeking dairy-free options due to rising concerns about lactose intolerance, cholesterol levels, and digestive issues.
The shift is further influenced by ethical considerations related to animal welfare and environmental sustainability. Oat based beverage offer a creamy texture and a naturally sweet taste, making them a desirable alternative to dairy and other plant-based drinks. The market is witnessing increased adoption among vegan and flexitarian consumers, fueling demand across multiple demographics and reinforcing the product’s position in the global beverage industry.
Market Driver
“Increasing Adoption in Foodservice Industry”
The expansion of the foodservice industry is propelling the growth of the oat based beverages market. Coffee chains, cafés, and quick-service restaurants are incorporating oat based beverage into their menus due to strong consumer demand for dairy-free options.
The creamy texture and neutral taste make oat based beverage an ideal choice for lattes and specialty drinks, leading to greater adoption among baristas and consumers. Partnerships between beverage brands and foodservice operators are improving product availability and visibility.
The rising popularity of oat based beverage in urban café cultures and premium coffee outlets is fostering market growth, contributing to higher sales volumes.
Market Challenge
“High Production Costs and Pricing Constraints”
The growth of the oat based beverages market is hindered by high production costs, fueled by raw material expenses, processing requirements, and supply chain complexities. Oat milk production involves enzymatic processing to achieve the desired texture and nutritional profile, increasing operational costs.
Additionally, premium pricing compared to dairy and other plant-based alternatives limits consumer adoption, particularly in price-sensitive markets.
Companies are optimizing supply chains, investing in large-scale production facilities, and adopting cost-effective processing technologies to enhance efficiency.
Strategic partnerships with oat farmers ensure stable raw material sourcing, while private-label collaborations with retailers enhance affordability and accessibility.
Market Trend
“Expanding Product Innovation and Flavor Diversification”
The oat based beverages market is benefiting from ongoing product innovation and the introduction of diverse flavors. Companies are developing formulations tailored for different applications, including barista-specific oat milk with enhanced frothing capabilities for coffee shops.
Sugar-free, protein-enriched, and organic variants are gaining traction among consumers with specific dietary preferences. The introduction of oat based beverage infused with flavors such as vanilla, chocolate, and caramel is expanding consumer appeal.
Innovation in packaging, including ready-to-drink formats, is enhancing convenience and boosting retail sales. These developments are supporting market penetration across different regions, supporting long-term industry growth.
Segmentation |
Details |
By Type |
Oat Milk, Oat-based Yogurt Drinks, Oat-based Smoothies and Shake, Others |
By Nature |
Organic, Conventional |
By Sales Channel |
Supermarkets/Hypermarkets, Convenience Store, Online Retail |
By Region |
North America: U.S., Canada, Mexico |
Europe: France, U.K., Spain, Germany, Italy, Russia, Rest of Europe |
|
Asia-Pacific: China, Japan, India, Australia, ASEAN, South Korea, Rest of Asia-Pacific |
|
Middle East & Africa: Turkey, UAE, Saudi Arabia, South Africa, Rest of Middle East & Africa |
|
South America: Brazil, Argentina, Rest of South America |
Market Segmentation
Based on region, the global market has been classified into North America, Europe, Asia Pacific, Middle East & Africa, and Latin America.
The North America oat based beverages market captured a share of around 38.21% in 2023, valued at USD 326.7 million. The widespread adoption of oat based beverage in the region’s coffee and foodservice industry is accelerating this growth.
Leading coffee chains, including Starbucks and Dunkin’, have incorporated oat milk into their menus, enhancing mainstream acceptance. Its superior frothing ability and neutral taste make it a preferred dairy alternative for lattes and specialty drinks.
Quick-service restaurants and premium cafés are capitalizing on this trend by offering oat based beverage, strengthening their presence in urban and suburban markets.
Environmental concerns are further boosting the growth of the North America industry. Compared to dairy and other plant-based alternatives such as almond milk, oat beverages have a lower carbon footprint and require less water for production.
Consumers are actively choosing sustainable food and beverage options, prompting companies to invest in eco-friendly packaging and carbon-neutral production processes.
Asia Pacific oat based beverages industry is likely to grow at a CAGR of 9.16% over the forecast period. This growth is attributed to increasing consumer awareness of health and wellness. A growing number of individuals are shifting toward plant-based diets to manage cholesterol levels, improve digestion, and support heart health.
Additionally, lactose intolerance is prevalent among a significant portion of the Asian population, creating a strong demand for dairy alternatives.
Oat based beverage offer a nutritious and easily digestible option, positioning them as a preferred choice among health-conscious consumers. The focus on preventive healthcare and functional nutrition is further bolstering regional market growth.
The global oat based beverages market is characterized by a large number of participants, including both established corporations and emerging players. Market participants are implementing strategies such as mergers to enhance scalability, foster innovation, and expand their market presence.
These strategic moves enable companies to strengthen their competitive positioning, leverage synergies, and accelerate product development. By consolidating resources and expertise, businesses can optimize supply chains, reduce operational costs, and improve market penetration.
Additionally, mergers facilitate access to advanced technologies and diversified product portfolios, catering to evolving consumer preferences. This approach drives business growth and contributes to the overall expansion of the market by increasing availability, enhancing product offerings, and fostering industry advancements.
Recent Developments (Partnerships/Agreements/New Product Launch)