Fermented Drinks Market Size, Industry Trends, Report 2031

Report Description

Fermented Drinks Market Outlook 2031

The global fermented drinks market size was valued at USD 3.7 Billion in 2022 and is projected to reach USD 6.17 Billion by 2031, expanding at a CAGR of 5.80% during the forecast period, 2023–2031. The growth of the market is attributed to increasing health consciousness and rising preference for probiotics among consumers.

Fermented beverages such as healthy kombucha, kefir, kvass, and cultured beverages are becoming increasingly preferred among consumers and beverage manufacturers. Fermented soda and fermented tea are also gaining high traction in the food and beverage industry due to the great nutritional value they provide to consumers.

• The International Food Information Council 2021 states that around 54% of probiotics and 38% of prebiotics consumer prefers having yogurt or kefir for gut health.

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The fermented beverages market is growing due to consumer awareness about the health benefits of these beverages. Beneficial microorganisms found in fermented beverages provide health benefits to the body. Furthermore, companies are increasingly offering probiotic drinks as the demand for probiotic-based beverages is growing around the world.

The market report finds that the COVID-19 pandemic has positively impacted the market as fermented foods help boost the immune system. Food made from fermentation ingredients helps in lessening the impact of COVID-19 and boosts antioxidants by improving digestion. Even though there were disruptions in the supply chain, import and export of goods, and less labor, the demand for fermented drinks was boosted owing to their immense health benefits.

Fermented Drinks Market Dynamics

Major Drivers

Increasing demand for low-alcohol beverages is expected to provide opportunities for the industry players during the forecast period. According to research, low-alcohol beverages accounted for nearly 86.8% market share. The rising awareness of health is boosting segment growth as people nowadays find lighter options to drink when it comes to alcohol. The growing trend of drinking less alcoholic content while maintaining health and wellness further boosts the segment.

Moreover, the increasing demand for craft beer is driving the market growth. Craft beers are rich in antioxidants and help contain vitamin B. Furthermore,

• According to the data from the Brewers Association, in 2022 craft brewer volume sales remained the same as in 2021, raising small and independent brewers’ share of the U.S. beer market by volume to nearly 13.2%.

Thus, with the growing demand for craft beers, the market is set to witness an uplift in the forecast period.

Existing Restraints

High manufacturing costs can hinder the growth of the market in the projected timeline. The manufacturing process and time of the fermented drink kombucha takes several days, thus, it has a high manufacturing cost. Moreover, smaller warehouse storage and less transportation services further restrain the market.

Emerging Opportunities

Growing demand for probiotics and plant-based fermented drinks is expected to create lucrative opportunities for the market players. Plant-based fermented drinks offer a positive impact on the gastrointestinal tract. These drinks offer natural enzymes and probiotics for gut health.

• A survey from the International Food Information Council 2022 states that the new Generation Z is more expected to purchase products labeled as “Small carbon footprint/carbon neutral” and “Plant-based.” Moreover, 18% of people report consuming milk/yogurt and 23% reported consuming other plant-based dairy alternatives.

Additionally, new launches and developments for plant-based fermented drinks are further creating opportunities for the market.  

• For instance, in April 2023, DSM, a global, science-based company, introduced an extensive, functional ingredients toolkit for plant-based fermented products. The new concepts show the process of running the toolkit for developing new plant-based fermented products. DSM’s Plant Power Toolkit empowers producers by removing the complexity of formulating plant-based fermented products which helps them to bring quality products to market faster.

Scope of Fermented Drinks Market Report

The market report includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Fermented Drinks Market Segment Insights

Type Segment Analysis

Based on type, the global fermented drinks market is segregated into alcoholic beverages and non-alcoholic beverages. An alcoholic beverage contains ethanol, a type of alcohol produced through the fermentation of grains, fruits, or other sugar sources. In many cultures, alcohol consumption plays an important social role. Moreover, the emerging brands in the industry are boosting the market.

• For instance, In June 2023, the first commercially-produced alcoholic brand tepache was introduced in the US. It is a fermented beverage similar to kombucha created with a fermented fruit base at 7 percent ABV.

The non-alcoholic beverage segment is anticipated to exhibit a robust CAGR during the forecast period. Rising awareness about the negative impacts of alcoholic beverages and increasing health consciousness are driving the market segment growth.

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Distribution Channel Segment Analysis

On the basis of distribution Channel, the fermented drinks market is segregated into supermarkets, convenience stores, specialty stores, and others. The convenience stores segment is anticipated to account for a significant market share in the projected timeline. Convenience stores provide a broad range of fermented drinks to consumers. The growing number of convenience stores is further contributing to the segment.

• According to the National Association of Convenience Stores (NACS) magazine 2023, nearly 150,174 convenience stores are operating in the US, which is 1.5% up from December 2021.
• A report published in INFORMS PubsOnline, states that the retail market contributes to 10% of GDP in India. It further states that convenience stores accounted for a share of around 43% in 2021.

Regional Analysis

In terms of region, the market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. The market in Asia Pacific holds the largest share of the market, however, due to the rise in demand for maintaining gut health and other related issues the market in North America is expected to exhibit a high CAGR during the forecast period.

The market in Asia Pacific is expanding owing to the growing preference for fermented beverages in China and India drives the regional market. The growth of the regional market depends on detoxifying health naturally. The growth rate in China is nearly 12% YoY for intestinal health, and cleansing (78.2%). Moreover, the increasing usage of healthy kombucha in India further contributes to the market.

The market in North America is anticipated to exhibit a high CAGR of the market owing to the increasing penetration of probiotic drinks. Probiotic drinks help in maintaining gut health. According to a survey, in 2021, around 32% of Americans are actively consuming probiotics and more are adopting them. Thus, increasing demand for yogurt, kefir, and others is contributing to the regional market.

• For instance, In March 2022, Danone North America launched the new Activia+ Multi-Benefit Probiotic Yogurt Drinks, packed with billions of live and active probiotics that help support gut health. It is an excellent source of Vitamins C, D, and Zinc to support the immune system.

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