Kefir Market Size, Share & COVID-19 Impact Analysis, By Product Type (Dairy-based & Non-dairy), By Nature (Organic & Conventional), Category (Flavored & Non-flavored), Distribution Channel (Supermarkets/Hypermarkets, Convenience Stores, Specialty Stores, & Online Retail), and Regional Forecast, 2020-2027

The global kefir market size was valued at USD 1.23 billion in 2019 and is projected to reach USD 1.84 billion by 2027, exhibiting a CAGR of 5.4% during the forecast period. The growing awareness about digestive health among consumers has compelled manufacturers to develop novel probiotic beverages. 

The global market is primarily driven by the growing popularity of probiotics food & beverages. The growing awareness about digestive health among consumers has compelled manufacturers to develop novel probiotic beverages. This is a fermented beverage made from kefir grains, a mixture of yeast & lactic acid bacteria. The growing knowledge regarding gut microbiota and its role in improving immunity and overall health is expected to drive the growth of this market. New product developments focused on emerging trends such as organic, lactose-free (for lactose-intolerant consumers), and flavored beverages are expected to boost the kefir industry growth in upcoming years.

Declining Kefir Sales amid COVID-19 Pandemic to Impede Growth

The demand and sale have experienced a sudden slump as a result of the outbreak of the COVID-19 pandemic. Nationwide lockdowns in various countries have resulted in the increased demand for home cooking ingredients and products, which has slowed the growth of on-the-go products. For example, The Coca-Cola Company experienced around a 25% decline in its beverage sales across the globe. Likewise, the disruption in the supply chain also affected the production of tibicos due to a fragmented supply of raw materials. However, the increased concerns related to immunity and overall health have re-established the demand for functional food and beverages, which is expected to continue during & after the pandemic. The rising awareness of gut health to improve immunity is expected to fuel the demand for products in the foreseeable years. 

KEFIR MARKETLATEST TRENDS

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Rising Awareness Regarding Digestive Health to Increase Demand for Probiotics

In 2019, the Food and Health Survey conducted by the International Food Information Council suggested that about 23% of consumers seek food & beverages for health benefits. Of these, more than half of consumers sought products for digestive health. The modern-day hectic lifestyle has augmented the prevalence of lifestyle-related health conditions such as gastric disorders, obesity, and diabetes. Consumers are becoming more aware of the importance of gut microbiota in maintaining immunity & overall health, which is emerging as one of the leading market trends. Probiotic beverages are becoming popular among consumers as instant sources of gut-friendly bacteria. The growing demand for functional and fermented beverages is expected to drive the demand for probiotic beverages in upcoming years.

DRIVING FACTORS

Growing Popularity of Functional Beverages to Profoundly Contribute to Market Growth

The increasing popularity of functional beverages to support the trend of on-the-go nutrition is primarily driving the growth of the global market. This is an indulgent probiotic drink that supports the growth of healthy gut microbiota. The growing demand for nutrient-enriched beverages to reduce the risk of certain health conditions fuels the growth of the market. The rising trend of lactose-free products also drives the demand for kefir as the drink is almost free from lactose. The growing trend of non-dairy beverages has contributed to the development of non-dairy or water-based kefir products, boosting the demand among vegan consumers. The increasing activities to develop new fermented milk varieties with innovative flavors are expected to boost the market growth in the upcoming years.

In November 2019, according to a study conducted by DuPont Health & Nutrition, globally almost 65% of the consumers are likely to shift towards plant-based food products, which bodes well for this market.

Robust Demand for Fermented Dairy Products to Propel Market Growth

In recent years, the demand for fermented dairy beverages has increased on account of their health-promoting properties. The growing demand for dairy protein to improve overall health fuels the growth of the market across the globe. According to Food and Beverage Insider magazine, the global value sales of clean-label food products is expected to reach USD 180 billion by the end of 2020.

Fermented products are perceived to be ‘better-for-you’ by consumers, supporting a healthy gut microbiome. The fermentation process provides enticing sensory appeal along with acting as the instant source of healthy gut bacteria. The growing popularity of organic, clean-label, and lactose-free products is projected to drive the growth of the global market. The emerging trend of healthy snacking and on-the-go nutrition is further expected to contribute to the market growth in foreseeable years.

RESTRAINING FACTORS

Challenges Faced in Maintaining Shelf-stability of Kefir Hampers Market Growth

The incorporation of lactic acid bacteria or yeast for manufacturing kefir generally shortens the shelf life of the final product. The uncontrollable growth of these bacteria also alters the sensory parameters of kefir to lower its palatability. The challenges faced in maintaining the stability of this drink throughout its shelf-life primarily hampers the growth of the global market. However, increasing research and innovation activities to develop advanced packaging solutions to enhance the shelf-stability of the beverage is expected to reduce the difficulties faced by manufacturers.

KEFIR MARKET

SEGMENTATION

By Product Type Analysis

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Dairy-based Category Dominates the Global Market

The global market is segmented by product type, nature, category, and distribution channel. The dairy-based segment among product types holds the major kefir market share in the global market owing to the higher demand for dairy nutrients such as milk proteins among consumers. The rising popularity of probiotic beverages fuels the demand for dairy-based.

However, the growing trend of non-dairy products has increased the demand for non-dairy or water-based kefir, also known as tibicos. This variant is now becoming popular among consumers following plant-based or vegan diets. The growing demand for water-based in the functional water category is expected to boost the growth of the market in the upcoming years.

By Nature Analysis

Organic Category Holds Major Share Backed by Robust Popularity of Organic Products

The popularity of organic food and beverages has significantly increased in the past few years owing to their healthier and safer counterparts as opposed to conventional products. Organic milk has acquired a mainstream place in retail aisles. The growing demand for organic dairy products fuels the growth of the organic segment. The increasing demand for nutrient-rich, ready-to-drink, on-the-go beverages has contributed to the growth of organic kefir among consumers. The increasing utilization of natural and organic flavors is expected to further boost the segmental growth in the forthcoming years.

By Category Analysis

Flavored Segment holds Major Share Supported by the Rising Demand for Innovative Flavors in Beverages

The popularity of flavored beverages across the world mainly contributes to the growth of the flavored segment. The increased demand for flavored drinks has necessitated manufacturers to develop kefir with novel flavors. According to Technomic’s 2019 Flavour Consumer Trend Report Survey, 80% of consumers actively seek out new flavors to try out on a regular basis. The emerging trend of natural products has contributed to the increased utilization of natural flavors such as fruits, vegetables, and flowers. Furthermore, this drink, when made with naturally-sourced flavors, is also perceived to be healthier as these flavors carry natural plant extracts.

By Distribution Channel Analysis

Supermarkets/Hypermarkets are the Leading Distribution Channels in the Global Market

Supermarkets/hypermarkets are continuously changing and increasing in number and investors are capitalizing on the buyers' demand for comfort to offer easy shopping experience. The adoption of technological advancements and equipment on the floor will help retailers provide adequate quality of products to the consumers. According to the Food Industry Association 2018, 43% of the total grocery in 2017 was sold through supermarkets/ hypermarkets, thereby representing a major share of sales every year.

The dominance of mass merchandisers viz. supermarkets/hypermarkets in this market are, however, being overtaken by the rapidly growing online retail platforms.

KEFIR MARKET

REGIONAL INSIGHTS

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The developed markets of Europe and North America are contributing heavily to the global market growth owing to the increased awareness regarding digestive health among consumers. The market in European countries is primarily driven by the rising demand for probiotic food and beverages. The increasing popularity of vegan diets also is expected to increase the demand for dairy-free kefir in the region. The growing trend of on-the-go nutrition and healthy snacking further fuels the market growth in Europe.

The North America market is mainly propelled by the growing popularity of fermented and nutritional beverages. Increasing investments in research & new product developments are driving the market in North America.

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Asia Pacific is expected to witness growth rates higher than the global average during the forecast period. Consumers have gradually shown interest in innovative beverages with novel flavors. Developing markets such as China, India, and Indonesia are projected to propel the sales growth owing to the increasing millennial population and growing interest in functional beverages to improve overall health.

KEY INDUSTRY PLAYERS

Lifeway Foods, Inc. is Focused on Innovation & Expansion to Strengthen Market Footprint

Lifeway Foods is currently focused on investing in innovation & expansion of its kefir business to strengthen the position in the global market. For instance, in March 2019, the company introduced a vegan kefir drink that comes in a variety of flavors. The new product is completely free from dairy, soy, and gluten.

Overall, the market exhibits a highly consolidated structure, dominated by large multinational companies. The key players such as Nestle S.A., Danone S.A., and The Hain Celestial Group are focusing on strategic mergers, acquisitions, and partnerships to gain further a competitive edge that comes from such synergies.

LIST OF KEY COMPANIES PROFILED:

• Lifeway Foods, Inc. (Illinois, U.S.)


• Nestle S.A. (Vevey, Switzerland)


• Danone S.A. (Paris, France)


• The Hain Celestial Group, Inc. (New York, U.S.)


• Biotiful Dairy Limited (London, England)


• Green Valley Creamery (California, U.S.)


• Fresh Made Dairy (Pennsylvania, U.S.)


• Maple Hill Creamery, LLC (New York, U.S.)


• Emmi AG (Lucerne, Switzerland)


• The Icelandic Milk and Skyr Corp (New York, U.S.)

KEY INDUSTRY DEVELOPMENTS:

• In July 2021, Lifeway Foods, Inc., U.S. based leading producer of kefir products, announced the brand's first expansion into the French market for kefir distribution with a listing at Costco France.


• In July 2021, Müller, a multinational producer of dairy products, introduced the company's first kefir product - Müller Kefir Smoothie. Müller Kefir Smoothie is gut-friendly, contains real fruit,  low in fat, and contains calcium. It comes in two variants: Raspberry & Pomegranate and Mango & Orange.


• In May 2021, Biotiful Dairy Ltd., a U.K.-based dairy company, launches a new Kefir + Coffee product line in the U.K. The Kefir cold brew coffee is made with British Milk with no added sugar and is gut-friendly. Biotiful Kefir Coffee on-the-go is the perfect drink for natural energy uplift with immunity support. The new Kefir + Coffee range was launched in two varieties: mocha and latte.


• In February 2021, Lifeway Foods, Inc. introduced two new products for consumers to help support immunity and improve overall health: Organic Grassfed Kefir and 3.5oz Functional Shot Multipacks.

KEFIR MARKET REPORT COVERAGE

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The market research report provides detailed industry analysis and focuses on key aspects such as leading companies, product types, and leading distribution channels of the product. Besides this, the report offers insights into the kefir market trends and highlights key industry participants and developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years.

KEFIR MARKET Report Scope & Segmentation: