Alternative Dairy: State of the Industry – Part 1


Precision Fermentation


The up-and-coming alternative dairy industry is chock-full of different technologies, products, and key players, all of which are geared towards the unified goal of providing the world with nutritious and sustainable alternatives to animal-derived dairy products.

While the current alternative dairy landscape has the right intentions and is gaining traction, it still falls short in delivering equivalent substitutes to dairy products.

Because of this, we may see that market adoption of plant-based products soon reaches a glass ceiling. To truly create alternative dairy on par with traditional dairy in taste, texture, and nutritional content, technologies like precision fermentation, and eventually cell-based milk, must be implemented.

In this State of the Industry, we’ll discuss what’s missing from plant-based dairy, how precision fermentation can improve alternative dairy, and how TurtleTree plans to bring functional ingredients to alternative dairy. Consider this your guide to alternative dairy.

In the last decade, alternative dairy has experienced explosive growth. More and more, consumers are swapping out their dairy milks for plant-based alternatives.

In the US, dairy milk consumption has been slowly declining, while plant-based milk purchases have increased by 36%  from 2013-2017. Some of the top reasons consumers avoid dairy include: lactose intolerance/dairy sensitivity (63%), animal cruelty issues (20%) and environmental reasons (15%).

However, let’s be clear: the dairy industry is still huge and growing. The global dairy market grew 30% from 2005 to 2015 and is estimated to reach USD $640.8B by 2030.

In the U.S., consumption of dairy products like cheese continues to grow. It’s no wonder why dairy products remain a large portion of our plates. A lot of it has to do with dairy’s unique taste, texture, and nutritional content.

Not only do vitamins in milk and nutrients in milk make dairy a staple of a well-rounded diet, but its creamy, frothy, stretchy, gooey, texture makes it desirable across a wide array of product applications: from lattes, to pizza, and even paneer. Just think of cheese’s irresistible ooze as it leopards atop your favorite pizza!

Plus, dairy milk is a great source of calcium, Vitamin D, and protein. So much so that the United States Department of Agriculture’s (USDA) Dietary Guidelines, 2020-2025 designates dairy as its own food group and assigns minimum amounts of macronutrients and minerals that should be included in one serving of dairy.

This is important because, as you’ll see, these Dietary Guidelines create a measuring stick against which all plant-based milks are judged and fall short. The repercussions of this nutritional inferiority extend beyond just health and consumer choices, and can actually preclude plant-based milks from inclusion in government programs where they would receive national recognition.

It’s easy to see how dairy’s nutritional value, unique texture, and taste make it difficult to perfectly recreate, especially when competing at the same subsidized price point.

However, transitioning from traditional animal-derived to alternative dairy is a crucial component to solving the current climate crisis. The Food and Agriculture Organization (FAO) estimates that the global dairy industry contributes to 4% of all human-made greenhouse gas emissions, with methane being the primary gas emitted.

One study found that if the global population switched to a plant-based diet, greenhouse gas emissions from food production could decrease as much as 70%. So you can imagine how enabling a widespread transition from animal-derived to alternative dairy would pose huge benefits to the environment.

Luckily, precision fermentation and eventually cell-based milk can drastically improve the current shortcomings of plant-based products; delivering the “2nd generation” of alternative dairy that truly functions as an equivalent substitute to traditional dairy. Moreover, precision fermentation-derived ingredients like TurtleTree’s recombinant bovine lactoferrin protein, “LF+”, can make the second generation of alternative dairy complete with bioactive that deliver functional benefits to help you feel your best. Reaching this second generation of alternative dairy is key to reducing animal suffering, meeting climate goals,  and maximizing market adoption of alternative dairy products.

And to be clear, the goal isn’t to entirely replace conventional dairy. Instead, the goal is to relieve the planet of the overwhelming demand for dairy in all sorts of applications like protein powders, premade frosting, or canned soup. This way, dairy farmers can focus on making high-quality dairy products on smaller farms with happier cows that require fewer precious natural resources.

Implementing innovative food production technologies is central to meeting all these goals. So what better way to start than to set the scene with an overview of plant-based, precision fermentation, and cell-based technologies?

The Tech

There are three pillars of alternative dairy (and protein) technology: plant-based, fermentation-derived, and cell-based.

The Three Pillars of Alternative Dairy (and Protein) Technology

Perhaps you’ve already tried plant-based products from the grocery store and found your favorites. Or, maybe you’ve experimented with every plant-based cheese in your grocery aisle by now and none hold up to your late-night quesadilla cravings.

We’d consider these the “first generation” of alternative dairy. Plant-based products are defined as products made from plants that act as alternatives to animal-based products.

Common ingredients for plant-based milks include oats, almonds, rice, soy, or coconut. To create plant-based milks, nuts or grains are soaked in water and then blended and strained. Plant-based is a relatively simple technology in the sense that although many plant-based milk companies have their own proprietary ways to blend and strain, fundamentally no new biotechnology is implemented.

Examples of plant-based dairy include Almond Breeze’s almond milk or Oatly’s oat milk. Existing plant-based milks are great because they are much more climate-friendly and cater to those who avoid dairy for whatever reason, but they are still lacking in a number of areas that may stagnate their growth: mainly nutrition, sensory properties, and price.

Bloomberg recently criticized the plant-based industry for “flopping” by failing to deliver on these same characteristics.

Part 2 of this post will break down how plant-based dairy currently falls short.

The Process of Precision Fermentation

There are broadly two types of fermentation-derived technologies: biomass and precision fermentation. Because biomass fermentation has yet to be used to produce dairy alternatives, we will focus this section on Precision Fermentation.

Precision fermentation enlists microorganisms to produce animal-derived ingredients. Check out our Precision Fermentation FAQ to learn about all things precision fermentation.

It’s important to distinguish that Precision Fermentation technology creates ingredients rather than whole products. Precision fermentation-derived ingredients can be added to plant-based products to create hybrid products.

Perfect Day’s Cowabunga and Bored Cow milks are examples of hybrid dairy products. They are plant-based milk supplemented with Perfect Day’s precision fermentation-derived whey protein.

By adding precision fermentation ingredients, these hybrid milks better mimic traditional dairy – both in nutritional value and sensory properties like taste and texture.

On top of that, precision fermentation-derived dairy proteins like TurtleTree’s LF+ can deliver health benefits beyond the nutritional value of plant-based dairy by utilizing the wonder of bioactive.

Part 3 of this post will dive into how Precision Fermentation can deliver the “2nd generation” of alternative dairy now, putting animal-free dairy on par with animal-derived dairy. And, we’ll demonstrate how TurtleTree provides value to this 2nd generation of alternative dairy by focusing on niche dairy bioactive protein ingredients like lactoferrin.

The Process of Cell-Based Milk

Animal cell-based (or cultivated) technology also has the potential to deliver the “2nd generation” of alternative dairy, however, realistically it will take some time for this technology to scale and become accessible.

That’s why here at TurtleTree we’re still working on the complicated process of creating cell-based milk, but our first products are precision fermentation-derived bioactive dairy proteins like LF+.

Cell-based technology makes genuine animal milk or meat by cultivating animal cell lines to replicate the animal product.

In the case of producing cell-based cow’s milk, mammary cells are harvested from the cow udder and then proliferated in a bioreactor that mimics the udder. The cells are arranged in the bioreactor atop a fine mesh. Then they’re fed nutrients and lactation hormones to induce milk secretion.

Depending on the exact method, once the cells produce milk, the milk might trickle through the mesh to the other side of the filter. This helps separate the milk from the cells as the first step of purifying the milk to become the final product.

Cultivated milk is the most promising technology to recreate whole milk that is very similar to traditional milk.

However, the price point for cultivated products will remain high for some time until R&D has figured out how best to scale this complex technology.  One interim solution to lower the price during this period is to create cultivated plant-based hybrids products.

Companies like Eat Just who are producing cultivated meat have taken this approach to improve cost and scale by creating products that contain cultivated meat supplemented with plant-based analogue. In the future, companies making cell-based milk may choose to do the same, creating milk products that are a mixture of cell-based and plant-based milks.

Cell-based is the only technology with the ability to produce milk in its entirety. This cell-based milk could then be made into cheese, ice cream, yogurt, or other dairy products that would be indistinguishable from traditional dairy products – in taste, texture, and nutritional value.

Thus, cell-based technology makes it possible to enjoy that grin-worthy cheese pull guilt-free, because it’s made entirely animal-free.

In addition to TurtleTree, one company working on cell-based cow’s milk is Montreal-based Opalia.

The Technology of Alternative Dairy

We could consider plant-based dairy the “first generation” of alternative dairy, while precision fermentation and cell-based technologies can usher in the “2nd generation” of alternative dairy.

Stay tuned to part 2 of this post where we’ll talk through some of plant-based dairy’s shortcomings.

In part 3, we’ll discuss how precision fermentation can rectify these issues and how TurtleTree is uniquely positioned to deliver functional alternative dairy ingredients.