​Has the UK Vegan Wave Peaked?

Several key brands, including Oatly, Nestlé, and Innocent Drinks, have withdrawn select plant-based products from the UK market, raising questions about the robustness of the vegan trend.

Per-Olof Forsberg, CC BY 2.0, via Wikimedia Commons

In 2019, Oatly introduced a vegan ice cream range with "unashamedly indulgent" flavours such as chocolate fudge and hazelnut swirl. This launch aligned with the surge of vegan-labelled food products entering the market. About a quarter of all food product launches that year carried a vegan label.

Yet, the vegan momentum might be waning. Oatly confirmed the discontinuation of its ice cream tubs in the UK, clarifying that its decision stemmed from other well-performing plant-based options in the market.

Nestlé, earlier this year, withdrew its Garden Gourmet and Wunda plant-based brands due to unsustainability in the current market. Similarly, Innocent Drinks stopped producing certain dairy-free smoothies due to underwhelming sales, and Heck considerably reduced its vegan product line.

The broader outlook isn't entirely bleak; the global vegan market could be worth £50bn by 2030. However, recent sales trends in the UK show many vegan products plateauing or declining. Combining a higher cost of living, pricier vegan alternatives, and market saturation poses challenges.

Retail analyst Clive Black commented on the over-exaggeration of the vegan market's potential: "Reality is dawning... There will be some winners, but... we've been through a bubble."

Tischbeinahe, CC BY-SA 4.0, via Wikimedia Commons

Data from NIQ (previously NielsenIQ) indicates that in Veganuary this year, sales for certain meat substitutes decreased compared to 2022, while plant-based milk saw only marginal growth.

Furthermore, stock market performance mirrors these challenges. Beyond Meat's share value plummeted from over $230 in 2019 to around $11 recently. Oatly's stock also took a hit, dropping from over $28 in 2021 to below $2.

However, Hamish Renton from HRA Global remains optimistic, acknowledging the initial rush and subsequent correction. He said: "There were too many products on the shelf for the volume of sales."

The Vegan Society commented on this flux, noting that the plant-based market is still young. They said: "The whole market has a huge number of products, having seen an incredible boom in recent years."

Despite some setbacks, Oatly announced strong growth figures, particularly in oat drinks, and shared plans for its first UK factory in Peterborough. They've also hinted at launching a "soft serve" ice-cream available at select food outlets later in the year.