Oat milk is becoming one of the top choices for dairy alternatives, and many coffee chains have traditionally applied a surcharge for this alternative milk option. Nonetheless, oat prices have reached an all-time high, which may discourage the trend of offering more milk choices to coffee lovers.

There has been an overwhelming demand for oat and other plant-based kinds of milk in recent years. This is partly due to the perception that they’re better for the environment and a proliferation of new products.

Nielsen data shows that the number of food and beverage packages claiming to be dairy-free has increased by 27.5% since two years ago. In addition, European market research firm Euromonitor reports that dairy alternatives grew 23% between 2016 and 2021.

More and more coffee chains are now eliminating the extra charge for dairy alternatives. Last week, Starbucks announced that it would not charge extra for alternative milk choices at its UK stores. The coffee chain joins Pret A Manger, a sandwich and coffee shop that has been offering plant-based milk without a surcharge at international locations since 2019. Oakland-based speciality coffee roaster Blue Bottle also started offering oat milk as the default option in some Californian locations last year.

However, oat prices reached an all-time high in 2021. Due to extended droughts, oat future prices were nearly double compared to this time last year as of January 6th, reaching $6.85. Even though most of the global oat crop is to feed livestock, it also affects oat milk cost. The largest oat milk company, Oatly, made a statement in November that it will raise prices of products to offset the rising costs. Starbucks also stated that it expects commodity price increases to affect its business this year.

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