When Daiya Foods launched its first plant-based cheese in 2008 that could melt like its animal counterpart, CEO Michael Watts said the company essentially invented the space.
And now 15-years later, with a new proprietary fermentation method that Daiya will start using on its cheeses by the end of the year, Watts said the company is re-inventing the space.
Eating Daiya’s cheese made through its new method “is this sensorial explosion of taste and texture,” Watts said. “And then you move into, ‘Oh, wow. How is this made? And how is this possible when it’s from plants?’ It’s that moment that we are looking to capture when a consumer tries our next-generation cheese.”
Watts said the new fermentation method creates a plant-based cheese that is much closer to its dairy counterpart. The mouthfeel is similar. And Daiya’s new cheese will melt and stretch like dairy cheese.
The new process is the culmination of significant R&D, and is the next leg of a multi-year journey, Watts said. The cheese will be fermented in a facility located in Daiya’s new production and R&D campus in the Canadian province of British Columbia.
Watts said Daiya’s new fermentation process is essentially reimagining how fermentation works for plant-based cheese. It’s unique to Daiya, he said, though it is somewhat similar to the fermentation step for dairy cheese. He would not reveal additional details.
“It will elevate and completely change the plant-based cheese experience with consumers when they try it,” Watts said.
Watts noted Daiya is still working to finalize the formulation of the cheeses that will be launched using the technology. The new offerings will likely hit the market later this year.
Daiya, which was acquired by Japanese pharmaceutical company Otsuka in 2017, operates as its own business. Watts said Daiya used its own food scientists to develop the new fermentation technology, but it also relied on other partners in the fermentation space for guidance.
Plant-based cheese is growing quickly. Zion Market Research estimates the global market will be worth $4.72 billion by 2026, increasing at an 8.3% compound annual growth rate.
More companies are entering the plant-based cheese space. In the last year, heavyweights including NotCo and Kraft Heinz have introduced plant-based cheeses in the U.S. market. Other alternative cheese companies — including New Culture, which will make plant-based cheese with precision fermented casein — have plans to introduce products this year.
Otsuka’s 2022 financial report noted Daiya’s sales have been impacted by increased competition in the space, and the company is working toward enhancing its lineup.
Daiya is always improving its cheeses, Watts said. When Daiya’s new cheeses come on the market, it will be the ninth formula for the company’s signature vegan cheese shreds in the company’s history. In late 2021, Daiya added oats and chickpeas to the recipes for its block cheeses to make them creamier.
Constant improvement is part of Daiya’s DNA, Watts said. The company is trying to create cheeses that are not only desired by consumers, but better for the planet. Plant-based cheese uses significantly less water than its dairy counterpart, he said, so improving Daiya’s offerings also makes more sustainable food in the long run.
Watts said the company could get close to being satisfied when it closes the gap between plant-based and dairy cheese taste and performance. He thinks Daiya could even surpass dairy cheese because its products are healthier and better for the planet.
“That was something that we thought wasn’t even imaginable 15 years ago, and even five years ago,” Watts said. “We certainly feel it’s not just imagination now and [a] curiosity. It’s inevitable and it’s going to happen.”
