The choices we make at the coffee shop or supermarket dairy aisle are increasingly framed as environmental decisions. As Australians steadily swap cow’s milk for plant-based alternatives, a complex picture emerges about the true ecological cost of our daily pour.
A Changing National Palate
Australians are drinking significantly less dairy milk than they were a decade ago. According to Dairy Australia, per capita consumption has fallen from 100 litres a year in 2015 to an estimated 85 litres by 2025. This shift is part of a global trend, yet the national market remains nuanced. While an estimated 96% of Australians still consume animal milk, a substantial 42% of households also buy plant-based alternatives, with many homes stocking multiple milk types.
The plant-based dairy sector is now a significant market, valued at AUD 465 million in 2023 and representing 9.5% of the dairy milk market’s value. Soy milk currently leads in popularity, followed by almond milk—a contrast to the oat milk preference seen in the US. Forecasts suggest this segment will continue to grow faster than the traditional dairy market through to 2030. However, rapid population growth, primarily via immigration, is projected to cause a slight overall increase in total fluid milk consumption in 2025, even as per capita consumption continues its decline.
The Emissions Equation
When it comes to climate impact, the broad advantage of plant-based milks is clear. The primary reason lies in livestock digestion: cows produce methane, a potent greenhouse gas, during their digestive processes. In Australia, ruminant livestock are estimated to contribute around 13% of the nation’s total greenhouse gas emissions.
Data from the World Resources Institute quantifies the difference per cup: dairy milk averages 330g of emissions, compared to 122g for soy, 102g for oat, and 98g for almond. Tools like the ecoSwitch app, developed by The George Institute for Global Health in collaboration with Deakin University, translate this into consumer ratings. On its 0-100 Planetary Health Rating scale (where 100 is best), dairy milk scores around 85, while soy milk scores 96. Fraser Taylor, managing director of FoodSwitch at The George Institute, notes that while ratings for oat and almond are not yet available on this specific scale, soy is considered fairly representative of other plant-based options.
This lower footprint holds even when processing is accounted for. Research indicates that while the processing and packaging of plant-based milks can contribute up to 79% of their environmental impact (compared to just 4% for cow’s milk), their full “farm to fork” lifecycle emissions remain lower. Plant-based milks contribute about 1kg of CO₂ per litre produced, whereas dairy milk produces approximately 3kg of CO₂ per litre.
Water, Land, and Fertiliser: A More Nuanced Picture
Beyond carbon, the environmental ledger becomes more complicated, heavily influenced by geography and farming practices. “There’s a lot of nuance when it comes to making sustainable food choices,” says Dr Michalis Hadjikakou, a researcher in sustainable food systems at Deakin University. “You need to consider what the purpose of drinking the milk is.”
On water use, oat milk typically comes out on top. Oats are a dryland crop generally reliant on rainfall. Almond milk, by contrast, has the highest water footprint. Almond trees thrive in a Mediterranean climate and often require significant irrigation; producing one litre of almond milk can require around 370 litres of water. Dairy milk production is also water-intensive, needing approximately 628 litres of water per litre of milk when accounting for feed crops and animal needs. Soy milk is relatively efficient, requiring about 28 litres per litre.
Fertiliser use is another key factor. Soybeans, as legumes, can fix nitrogen from the air, potentially reducing the need for synthetic fertilisers and benefiting soil health. Oat crops generally use between 40 to 80 kg of nitrogen per hectare. In comparison, dairy farming can use around 143 kg per hectare, with Victorian dairy farmers using approximately 198 kg of fertiliser products per milking hectare in 2024-25. Almond cultivation is also noted to be “hungrier” for fertiliser.
Industry Adaptation and Consumer Choice
Faced with changing demand and environmental scrutiny, the Australian dairy industry is adapting. It has set a goal to reduce greenhouse gas emissions intensity by 30% by 2030, aligning with UN Sustainable Development Goals. Manufacturers have reportedly already reduced emissions intensity by 25% since 2010/11, with many farmers implementing new practices. Despite challenges like dry weather and rising costs, the sector shows resilience, with some forecasts predicting a modest increase in milk production for 2025.
For consumers navigating this landscape, experts caution against seeking a single “best” option. Comprehensive life cycle assessments indicate that dairy milk often has the highest impact in multiple environmental categories per litre, but the profile of plant-based milks varies. For instance, almond milk can show high impacts in categories like non-carcinogenics due to fertiliser and irrigation use, and its environmental cost per kilogram of protein is significantly higher than that of soy or dairy.
Dr Hadjikakou suggests a blended approach for those focused on reducing their dietary emissions. “Perhaps on your latte you could have almond [milk], for your cereal you could have cow’s milk. In that way, you’d still reduce your emissions.” The definitive choice, it seems, depends less on a universal verdict and more on which specific environmental priority—be it carbon, water, or land use—we aim to address with each carton we buy.
