Gabriel Morrison hadn’t touched dairy milk for a decade until he read the ingredients label on his cheap carton of oat milk.
“It’s [so much] canola oil and you imagine that in your glass, and imagine discovering that much olive oil, you’re like, that’s actually really gross,” he says.
“I was just like, ‘ooft, I should stop this’.”
The 28-year-old cinematographer had exclusively drunk soy, then almond, then oat milks since 2015 but had started worrying about processed foods – despite expert reassurance.
In early 2025, with his housemate already buying cheaper dairy, he gave the old classic another look.
“I’m looking at the ingredients and it’s 100% cow’s milk – this seems better than sugar, canola oil, vegetable oil and a whole lot of other random stuff,” Morrison says.
“There’s probably way worse stuff in my life. It’s just one of those many choices I make every day and I’m feeling slightly better about it.”
Milk is back on the menu after a long decline, as shoppers search for supermarket discounts, save 50c on their coffees and pick up new diet trends.
Plant milks appear past their peak as dairy businesses report surging sales of lactose-free products and a boom in protein demand.
Back to basics
Morrison had been one of millions of Australians to fall out of love with dairy over a decade of rising incomes and environmental awareness.
Australians cut back from drinking 100 litres of milk a year in 2015 to just 85 by 2025, according to Dairy Australia.
Soy, then almond, then oat milk consumption grew rapidly over the same period. Riverina Fresh, a cafe dairy supplier, saw plant milks surge from less than 10% of sales to 25% by 2023, according to its executive chairman, Craig Shapiro.
In inner-city cafes, where customers were typically more focused on sustainability, that mix hit 50%, Shapiro says. Research has found cow’s milk production requires more water and generates more emissions than plant milks, while cases of animal cruelty encouraged consumers to drop dairy.
Over the past four years, though, dairy has edged back share and plant milks have lost momentum. Cost-of-living pressures saw shoppers cut their spending at cafes, swapping to coffees at home, and buying more milk to match, Shapiro says.
“If you’re buying a dairy-based coffee versus a plant-based coffee and it’s an extra 50c to a dollar … maybe that is the tipping point,” Shapiro says.
While milk prices rose more than 20% in the past four years, they have stabilised over the last year, says Michael Harvey, senior analyst for Rabobank.
“The cost of all food has gone up, so consumers go back to basics,” Harvey says.
Supermarket milk sales shrank in 2023 and 2024 but returned to growth over 2025, up 1.1% to just over 1.4bn litres – nearly two-thirds of which was cheaper homebrand milk, Dairy Australia has found.
Plant milk producer revenues had doubled to $600m annually from 2015 to 2022 but have since gone backwards, according to IBISWorld analysis. Milklab, the Australian plant and dairy milk brand, says the industry can keep growing as fans still enjoy the taste and variety.
“They’re about, ‘I want an oat matcha’, [not] ‘I’m going to buy this drink and I’m going to substitute dairy’,” says Michael Perich, the chief executive of Milklab’s owner Noumi.
But sales are growing at a slower pace as health trends push shoppers back to “natural” products such as cow’s milk, he says.
“People are going back to meat. People are going back to dairy. [Some] consumers are a bit like, ‘well, I want less ingredients’,” Perich says.
An easing enthusiasm for vegan diets combined with scepticism around ultra-processed foods has encouraged shoppers back towards wholefoods globally.
Research has consistently found dairy milk is health-neutral and soy milk typically matches it in protein and calcium levels, says Fiona Willer, the CEO of Dietitians Australia.
Canola and other seed oils added to almond and oat milks are also fine, Willer says, regardless of the worries raised by the Trump administration health secretary, Robert F Kennedy Jr, who has promoted milk and unprocessed foods in his diet guidelines.
In the US, milk consumption had been falling on a per-person basis but steadied by 2024, government data suggests, with sales data suggesting the category boomed in 2025.
A boom in lactose-free options has enabled people who had avoided dairy for health reasons and gut discomfort to swap back.
Australian sales of a2 milk’s lactose-free option grew nearly 10% in the second half of 2025 compared with the same period of 2024. David Bortolussi, a2’s CEO, says an estimated one in three Australians believe they have some milk intolerance.
“There’s a lot more opportunity for us to expand into lactose-free and that’s also bringing more consumers back into the [milk] category,” Bortolussi says.
Protein-hungry shoppers are also driving dairy sales as the fitness trend cements its grip on the popular imagination, according to Bega Group.
Known for its cheese, the company now believes its future lies in milk and yoghurts – and their increasingly popular “protein-plus” counterparts. Yoghurt products with extra protein are selling out across the country’s dairy aisles and Bega is betting shoppers will soon start drinking a litre of high-protein milk a week as well.
Bega’s CEO, Pete Findlay, expects the craze to last at least five more years as demand moves from teenage boys and gym junkies into the mainstream.
“It’s actually going into older age categories as well [because] you need to ensure that you maintain your muscle mass,” he says.
Protein fixation could endure even further amid the growing popularity of weight loss drugs that can suppress appetite and lead to muscle deterioration. More than one in 10 Americans are believed to have used Ozempic or similar drugs and Findlay says he’s seen estimates Australian usage is approaching that level.
“With that weight loss, we become more active and we want to maintain our muscle bulk,” Findlay says.
“They’re looking to consume dairy, which is great: great for us and great for the industry.”
