It’s called oat milk, and baristas love its light, hearty flavor that lets the java beans take center stage. As more consumers choose plant alternatives to dairy, it’s gotten so popular that just in the last month, some coffee shops were left without oat milk for days, even weeks. To meet demand, producer Oatly Inc. is working with its manufacturing partners to increase output by 50 percent by this summer, said Mike Messersmith, general manager for U.S. operations, which are based in New York.

Oat milk “tastes the best of all the milk alternatives,” said 22-year Micah Lindsey, who works as a barista at an Intelligentsia coffee shop in Chicago’s Logan Square neighborhood. It has a “really creamy texture” that mimics real dairy and works well for latte art, she said.

Plant-based beverages have been stealing market share from dairy for years, and the trend isn’t showing signs of slowing. In 2018, U.S. retail sales of traditional milk are projected to drop 1.2 percent, while alternatives like oat and almond are expected to climb 3 percent, according to researcher Euromonitor. The switch has taken a toll on companies like Dean Foods Co., the largest U.S. dairy producer, which in February unveiled a $150m plan for cost cutting amid sluggish sales.

Supply Shortage

Dollop Coffee Co., a Chicago chain, began carrying Oatly oat milk in October 2017. Demand is especially growing among customers who are switching from soy milk, said spokesman Nate Furstenau. In March, the shops ran out of oat milk for about two weeks, and the company’s heard from its distributor that shortages could continue over the next month.

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