Oat milk: The vegan cash cow

The alt-milk causing a stir Walk into your local coffee shop and chances are you’ll encounter a wide range of alt-milk options, from humble soy to posher hemp and coconut. But there’s only one plant-based milk with enough cache to get billing as a desirable flavor in its own right: Oat milk, featured prominently everywhere from La Colombe’s [ready-to-drink chilled oat milk lattes]( to Starbucks’ [Iced Brown Sugar Oatmilk Shaken Espresso](. Oat milk’s trendiness owes much to the marketing savvy and global ambitions of the Swedish brand [Oatly](, which introduced much of the world to the rich, nutty taste of the beverage over the last decade. In late 2016, the company entered the US market. Within a few years, oat milk became the [second-most popular alt-dairy option]( after almond milk, and companies like [Chobani](, [Danone,]( [Nestlé](, and [HP Hood]( were getting in on the oat action. In the UK, meanwhile, oat milk has [surpassed almond milk]( in popularity to become number one. So what makes oat milk more than a substitute for dairy—and a cash cow in its own right? It’s just one way that companies are marketing sustainable eating and eco-conscious diets as an upscale pleasure, rather than a sacrifice. Settle in with an (oat milk) latte and read on. 🐦 [Tweet this!]( 🌐 [View this email on the web]( Sponsored by [Quartz Weekly Obsession] Oat milk November 10, 2021 The alt-milk causing a stir --------------------------------------------------------------- Walk into your local coffee shop and chances are you’ll encounter a wide range of alt-milk options, from humble soy to posher hemp and coconut. But there’s only one plant-based milk with enough cache to get billing as a desirable flavor in its own right: Oat milk, featured prominently everywhere from La Colombe’s [ready-to-drink chilled oat milk lattes]( to Starbucks’ [Iced Brown Sugar Oatmilk Shaken Espresso](. Oat milk’s trendiness owes much to the marketing savvy and global ambitions of the Swedish brand [Oatly](, which introduced much of the world to the rich, nutty taste of the beverage over the last decade. In late 2016, the company entered the US market. Within a few years, oat milk became the [second-most popular alt-dairy option]( after almond milk, and companies like [Chobani](, [Danone,]( [Nestlé](, and [HP Hood]( were getting in on the oat action. In the UK, meanwhile, oat milk has [surpassed almond milk]( in popularity to become number one. So what makes oat milk more than a substitute for dairy—and a cash cow in its own right? It’s just one way that companies are marketing sustainable eating and eco-conscious diets as an upscale pleasure, rather than a sacrifice. Settle in with an (oat milk) latte and read on. 🐦 [Tweet this!]( 🌐 [View this email on the web]( By the digits [16%:]( Oat milk’s share of all non-dairy milk sales in the US [203%:]( Growth in oat milk sales in the US between 2019 and 2020 [1:3:]( Typical ratio of espresso to milk in a latte [72%:]( Oat milk’s share of all non-dairy milk sales in Sweden [53%:]( Oatly’s market share of all non-dairy milk sales in Sweden [$7.4 billion:]( Oatly’s market capitalization as of Nov. 10, 2021 Reuters/Ilya Naymushin Origin story A milk in search of a market --------------------------------------------------------------- Oatly founder Rickard Öste developed the drink back in 1994 while working as a researcher at Sweden’s Lund University, in search of a dairy alternative for the lactose-intolerant. But Oatly didn’t really take off until CEO Toni Petersson took the helm in 2012, grabbing public attention with offbeat marketing tactics (“You actually read this? Total success” its [billboards]( declared) and testing the waters of new markets via [partnerships]( with hip, independent coffee shops. Soon oat milk had enough of a devoted following that shortages were a common occurrence—a 2018 [article]( in the New Yorker reported that Oatly had trouble keeping up with demand everywhere from the US to Sweden to the UK. It has since struck partnerships with Starbucks in major markets like the [US]( and [China]( and is betting on Asia for further expansion, opening a new [production facility]( in Singapore this fall. Meanwhile, Oatly’s offerings have extended far beyond beverages into products like ice cream, yogurt, and even a substitute creme fraiche. Supply issues are still a problem for Oatly, [lowering its stock price]( in the months since it went public at $17 a share [in May](. And the problem may become even more pronounced in light of a drought that [hit North American oat crops]( hard this summer. (The US had its [smallest harvest]( since 1866, the earliest year on record.) Then again, for customers, perhaps oat milk’s elusiveness only increases its appeal. Another [recent New Yorker piece]( satirized the desperation of coffee-house customers who refuse to accept alt alt-milks. “Soy?” a customer exclaims. “What is this, 2002?” DIY How do you milk an oat? --------------------------------------------------------------- Should you find yourself impacted by an Oatly shortage, it’s perfectly possible to make a minimalist version of oat milk at home. Simply pulverize oats and water in a blender, use a strainer to filter out the solids, and stick it in the fridge. The cooking blog Love and Lemons has a [handy recipe](. Giphy Pop Quiz Which of the following brands is NOT a global oat milk startup? Boring Oat Milk, New ZealandOh Oat, South AfricaAntid’Oat, ItalyOakidoki, China Correct. That name is up for grabs! Incorrect. This is real! If your inbox doesn’t support this quiz, find the solution at bottom of email. Charted The eco wars --------------------------------------------------------------- [A bar chart showing the environmental impact of 1 liter of milk and milk alternatives. Cow's milk uses the most land and water and results in the most greenhouse gas emissions by far. Soy milk and oat milk have the least impact on the environment.] So how much of a difference is there between how milk and its alternatives impact the planet? Here’s how some of the most popular options stack up against one another, according to a 2018 [analysis]( published in the journal Science. Oat milk is [often touted]( by Oatly and other companies as an environmentally-friendly alternative to dairy—an effort to appeal to consumers who are increasingly concerned with issues like climate change. “I think for people today, sustainability is more of an ideology,” Oatly CEO Petersson said at a [talk]( hosted by Goldman Sachs in 2020. “It’s a structured belief system, almost like a religion.” Oatly even goes so far as to print its carbon footprint on its carton labels. But such measures may not be a ton of help for the average consumer, since companies can [come up with their own ways]( of calculating emissions and offsets. Giphy The way we ☕️ now Oat allure --------------------------------------------------------------- Not everyone thinks oat milk is the nectar of the gods. “It tastes like shit!” one Oatly customer [famously commented](, a complaint that the self-deprecating Oatly promptly slapped across its packaging. But part of oat milk’s success can be attributed to the fact that its fans say it more closely mimics the thick, creamy taste of real-deal dairy. “It performed the best in terms of milk foaming texture, consistency, and flavor,” one San Francisco cafe’s marketing manager told the publication [Elemental](, explaining why it offers oat milk as its only non-dairy option. The appeal of oat milk, much like the plant-based meat offered by companies like Beyond Burger and Impossible Foods, is as much about flavor as health. These products are geared not toward vegans and vegetarians but toward the much bigger demographic of people looking to cut back on meat and dairy rather than giving them up entirely. “There is a massive exploration happening here,” Petersson told Bloomberg recently, saying that[35-40% of people in Oatly’s key markets]( of the US, the UK, Sweden, Germany, and Asia now buy plant-based milk. Quotable “I would prefer that oat milk become as commonplace as nonfat or whole milk, where people think of it as a third option. Because that’s what sustainability is about: eventually making it a part of the fabric of our lives. I don’t care much about the cool factor.” —[Josey Markiewicz, senior director of coffee quality and experience at La Colombe,]([speaking to the New York Times]( Giphy Million-dollar question Why do we drink so much 🐄 milk? --------------------------------------------------------------- Given that around [65%]( of the world population has some degree of lactose intolerance, it’s worth asking exactly how milk became such a staple in adult diets—particularly in the US, land of the iconic [“Got milk?” ad campaign]( featuring milk-mustachioed celebrities that began in the 1990s. The answer, it turns out, can be traced back in part to the US government attempting to offload milk surplus on schoolchildren during World War II. Read more in [this Vox interview]( with Alissa Hamilton, author of the book [Got Milked?]( YouTube Watch this! Baristas say that alt milks can make perfectly good latte art—it just takes a little technique to learn how to texture and pour each of the options. Watch this video from Wolff Coffee Roasters in Brisbane, Australia, to learn how to make the perfect swan or flower with oat, almond, and soy. Reuters/Kim Kyung-Hoon Poll How do you like your coffee? [Click here to vote]( A splash of milk or half and halfAll about that oat milkGimme that almond joyI take it black, like my soul Listen to this! 🎧 For an alt-version of this Obsession... --------------------------------------------------------------- There’s more to learn about oat milk! Listen to [this week’s episode]( of the Quartz Obsession podcast, with Quartz reporter Sarah Todd taking the plunge. Listen on: [Apple Podcasts]( | [Spotify]( | [Google]( | [Stitcher]( Sponsored by American Express [Listen up]( 💬 let's talk! In our last poll about [canned food](, 42% said your favorite canned pantry staple is tuna, 26% like those fancy San Marzano tomatoes, 16% are into sweetened condensed milk, and 14% prefer green beans. 🤔 [What did you think of today’s email?](mailto:obsession%2Bfeedback@qz.com?cc=&subject=Thoughts%20about%20oat%20milk&body=) 💡 [What should we obsess over next?](mailto:obsession%2Bideas@qz.com?cc=&subject=Obsess%20over%20this%20next.&body=) 🎲 [Show me a random Obsession]( Today’s email was written by [Sarah Todd](, edited by [Annaliese Griffin](, and produced by [Jordan Weinstock](. [facebook]([twitter]([external-link]( The correct answer to the quiz is Antid’Oat, Italy. Enjoying the Quartz Weekly Obsession? [Send this link]( to a friend! Want to advertise in the Quartz Weekly Obsession? Send us an email at ads@qz.com. Not enjoying it? No worries. [Click here]( to unsubscribe. Quartz | 675 Avenue of the Americas, 4th Fl | New York, NY 10011 | United States