Dairy Ingredients Market Size
| Study Period | 2019 - 2029 |
| Market Size (2024) | USD 62.50 Billion |
| Market Size (2029) | USD 76.27 Billion |
| CAGR (2024 - 2029) | 4.06 % |
| Fastest Growing Market | Asia-Pacific |
| Largest Market | Europe |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Dairy Ingredients Market Analysis
The Dairy Ingredients Market size is estimated at USD 62.5 billion in 2024, and is expected to reach USD 76.27 billion by 2029, growing at a CAGR of 4.06% during the forecast period (2024-2029).
- Dairy ingredients have been widely used in the food industry due to their functional and nutritional properties. For example, milk proteins, such as casein and whey protein, are often used as functional ingredients in food products due to their emulsifying, foaming, and gelling properties.
- In addition, dairy ingredients are also rich in essential nutrients such as calcium, vitamin D, and vitamin B12, which are important for bone health, immune function, and energy metabolism. Fortifying foods with dairy ingredients can provide consumers with a convenient and accessible way to obtain these important nutrients. Moreover, dairy ingredients can also enhance the taste, texture, and appearance of food products, making them more appealing to consumers. For example, butter, cream, and cheese are commonly used in baked goods, sauces, and dips to provide richness and flavor.
- Overall, the demand for functional and fortified foods has led to an increase in the use of dairy ingredients in the food industry as manufacturers seek to create products that are both nutritious and appealing to consumers. Ingredients, such as milk powder, are being used in infant formulas and sports drinks. The millennial population in the Asia-Pacific region is growing, so the demand for food and beverages is also rising. The trend of high-protein food and drinks has been rapidly gaining popularity worldwide. Manufacturers have been increasingly using protein claims in their food and drink launches due to the growing demand from health-conscious consumers.
- Over the past few years, the number of high-protein food and drink launches has significantly increased, making it one of the fastest-growing claims in the food and drink market. This trend is driven by a growing awareness of the health benefits of protein, including its ability to promote satiety, build and repair muscles, and support overall health.
- European consumers are actively seeking more milk protein in their meals, beverages, and snacks. The geriatric population in Germany has been increasing, with 22.09% of the population aged 65 and above in 2021, according to the Organization for Economic Co-operation and Development (OECD). This demographic trend has led to rising demand for medical and nutritional products to help maintain bone and muscle health among the elderly. Dairy ingredients are enriched with essential minerals such as calcium and phosphorus, crucial for bone health. Therefore, the demand for dairy ingredients has been increasing, as they are considered an important source of these minerals.
- Additionally, dairy ingredients are a good source of protein, which is important for maintaining muscle mass and strength. The manufacturers of sports nutritional products widely prefer functional dairy ingredients like whey protein due to its wide availability, strong amino acid profile, and easy digestibility. Meanwhile, the consumption of sports nutrition has increased among fitness enthusiasts and active lifestyle consumers as it aids in gaining energy and muscle and supports weight management. Thus, the increasing demand for whey-based sports nutritional supplements is driving the growth of the dairy ingredients market.
- Additionally, consumers and athletes are looking for natural and less processed nutritional solutions with proven benefits. Many dairy ingredient manufacturing companies are launching new nutritional solutions to support sports nutrition manufacturers. For instance, in December 2021, Lactalis Ingredients launched high-protein concepts with two native protein sources, including Ponativ's Native Micellar Casein and Pronativ's Native Whey Protein targeting sports nutrition and healthy aging.
- US consumers are prompting food and beverage manufacturers to include functional whey protein in the packed food products as it helps to replace the high-fat ingredients and maintains the same flavor and texture similar to the original formulation. Thus, the growing consumer demand for whey protein in packed food products is further propelling the growth of dairy protein in the market.
- There is a growing awareness among consumers about the benefits of dairy protein for maintaining a healthy lifestyle. Dairy proteins are rich in protein and have a superior content of amino acids. Ingredients such as whey protein, milk protein, and casein are also known for their anti-aging properties. Besides staying healthy, consuming dairy proteins also help reduce stress and improve immunity. They play a vital role in the growth of a child. As a result, the demand for dairy ingredients has increased globally.
Dairy Ingredients Market Trends
Increasing Milk Production Supporting the Demand for Dairy Ingredients
- The demand for more functional food and beverage products, driven by consumers' interest in health and wellness, has led to an increase in the use of milk protein in the market. According to Food and Agriculture Organization Corporate Statistical (FAOSTAT) Database, India is the world's largest milk producer, with an output of over 209.6 million tons of cow's milk in 2021. Other large milk producers were the United States, with almost 102.62 million metric tons, and Pakistan, with around 60.8 million tons. The Asia-Pacific region's active milk production has supported the growth of its derivatives, such as milk protein concentrates, milk powder, and whey protein ingredients. Due to their digestibility properties, milk protein isolates are the most commonly used ingredient by infant food manufacturers for products such as baby cereals, bottled baby food, and others.
- In 2021, manufacturers such as Lactalis launched organic whole milk powder ingredients with various applications across different end-user industries, such as the confectionery and bakery industries. This was done in response to the burgeoning demand from various end-user industries looking to formulate organic food products.
- Additionally, dried milk protein concentrate is produced from skim milk using a combination of processes, such as ultrafiltration (UF), evaporation or nanofiltration, and spray drying. The increasing demand for milk protein concentrates is supported by steady growth in skimmed milk powder production in the market. The United States has registered an increasing production of skimmed milk powders, supporting the growth of skimmed milk concentrates and milk protein concentrates during the study period.
- In addition to consumer demand, government initiatives to support the dairy industry have played a significant role in increased production. For example, the National Programme for Dairy Development (NPDD) in India aims to strengthen the infrastructure for the production of high-quality milk and its products. The positive outlook of the dairy industry in the market, coupled with the increasing demand for protein-rich food and constant evolution in product launches, is actively accelerating the application of various dairy ingredients in the food and beverage industry. This trend is expected to continue gaining momentum during the forecast period.
Europe Holds the Major Share
- Europe dominates the dairy ingredients market, with countries like the United Kingdom, Germany, and France using high-concentrate dairy ingredients such as whey proteins and milk protein isolates. The increasing interest in health and wellness among consumers, especially in the sports industry, has driven the demand for dairy ingredients in supplements. Key players in the industry are focusing on developing new products that cater to the consumers' evolving requirements. For example, in December 2021, Euroserum launched SICAPRO 35, a 35% serum protein concentrate suitable for the formulation of infant formulas.
- The increasing interest in protein as an ingredient is driven by fitness enthusiasts, particularly in Europe. The demand for mainstream health and wellness ingredients is also rising in the food and beverage sector. Countries like Germany and France have a significant demand for infant nutrition or baby formula that utilizes dairy proteins. Additionally, the region's strong coffee culture has contributed to the high demand for dairy ingredients, particularly in the preparation of creamers and whiteners for use in the food and beverage industry.
- Furthermore, the trend of organic food consumption has led to new product developments. For instance, in 2021, Lactalis Ingredients launched organic whole milk powder in France, sourced exclusively from French dairy farms that adhere to organic farming specifications. The organic standards ensure a product free from additives like neutralizing agents, antibiotics, and preservatives.
- Additionally, the growing consumer interest in high-protein snacking has resulted in the emergence of companies specializing in protein bars and confectionery. This trend is expected to continue to create growth opportunities in the dairy ingredients market. In March 2022, Mondelēz International acquired a significant majority interest in Grenade, a leading UK performance nutrition pioneer in the fast-growing high protein bar segment. Grenade is one of the category leaders in high-protein bars. Its Carb Killa has been the best-selling product in the segment, with a growing presence in the UK and availability across other regions, including North America and Asia Pacific.
Dairy Ingredients Industry Overview
The dairy ingredients market is highly competitive, with a large number of players operating in the industry. Arla Food amba, Fonterra Co-Operative Group Limited, Saputo Inc., Dairy Farmers of America, and Groupe Lactalis are some of the major players in the market. These companies are constantly innovating and expanding their product offerings to strengthen their presence in the market.
For example, in February 2022, Saputo Inc. announced a series of significant capital investments and consolidation initiatives to optimize and enhance its manufacturing footprint in its US Sector and International sectors. This move is part of the company's global strategic plan, which aims to improve operational efficiency and streamline business processes. Overall, the dairy ingredients market is highly dynamic, and companies must continually adapt to changing market conditions to stay competitive.
Dairy Ingredients Market Leaders
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Arla Foods amba
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Dairy Farmers of America
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Fonterra Co-Operative Group Limited
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Saputo Inc.
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Groupe Lactalis
*Disclaimer: Major Players sorted in no particular order
Dairy Ingredients Market News
- July 2022: NZMP, Fonterra's global ingredient business, entered into a joint venture with Tillamook County Creamery Association (TCAA) and Three Mile Canyon Farms in the US to launch Pro-OptimaTM, a grade A functional whey protein concentrate (fWPC), to the market.
- May 2022: Arla officially inaugurated a new production plant at Pronsfeld Dairy in Germany. The expansion is Arla's biggest dairy investment and a key driver in meeting the growing international demand for sustainable, affordable, and nutritious dairy products. To help bridge this cap, Arla has invested EUR 190 million in the expansion of its dairy in Pronsfeld, Germany, to increase the production of primarily milk powder.
- May 2022: Fonterra launched a new online dairy platform that makes it easier for ingredients customers to buy anything, from milk powder to specialty dairy proteins. It's called myNZMP and was introduced after customers asked for more convenience, more flexibility, and more information when ordering ingredients,
Dairy Ingredients Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Drivers
4.2 Market Restraints
4.3 Porter's Five Forces Analysis
4.3.1 Threat of New Entrants
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Bargaining Power of Suppliers
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
5. MARKET SEGMENTATION
5.1 Type
5.1.1 Milk Powders
5.1.1.1 Skimmed Milk Powders
5.1.1.2 Whole Milk Powders
5.1.2 Milk Protein Concentrates and Milk Protein Isolates
5.1.3 Whey Ingredients
5.1.3.1 Whey Protein Concentrate (WPC)
5.1.3.2 Whey Protein Isolate (WPI)
5.1.3.3 Hydrolyzed Whey Protein (HWP)
5.1.4 Lactose and Derivatives
5.1.5 Casein and Caseinates
5.1.6 Other Types
5.2 Application
5.2.1 Bakery and Confectionery
5.2.2 Dairy Products
5.2.3 Infant Milk Formula
5.2.4 Sports and Clinical Nutrition
5.2.5 Other Applications
5.3 Geography
5.3.1 North America
5.3.1.1 United States
5.3.1.2 Canada
5.3.1.3 Mexico
5.3.1.4 Rest of North America
5.3.2 Europe
5.3.2.1 United Kingdom
5.3.2.2 Germany
5.3.2.3 France
5.3.2.4 Russia
5.3.2.5 Italy
5.3.2.6 Spain
5.3.2.7 Rest of Europe
5.3.3 Asia-Pacific
5.3.3.1 India
5.3.3.2 China
5.3.3.3 Japan
5.3.3.4 Australia
5.3.3.5 Rest of Asia-Pacific
5.3.4 South America
5.3.4.1 Brazil
5.3.4.2 Argentina
5.3.4.3 Rest of South America
5.3.5 Middle-East and Africa
5.3.5.1 United Arab Emirates
5.3.5.2 South Africa
5.3.5.3 Rest of Middle-East and Africa
6. COMPETITIVE LANDSCAPE
6.1 Most Adopted Strategies
6.2 Market Share Analysis
6.3 Company Profiles
6.3.1 Arla Foods amba
6.3.2 Dairy Farmers of America
6.3.3 Sodiaal co-operative group
6.3.4 Fonterra Co-Operative Group Limited
6.3.5 Royal Friesland Campina
6.3.6 Kerry Group PLC
6.3.7 Kanegrade Ltd
6.3.8 Groupe Lactalis
6.3.9 Volac International Ltd
6.3.10 Hoogwegt International BV
6.3.11 Saputo Inc.
- *List Not Exhaustive
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
Dairy Ingredients Industry Segmentation
Dairy ingredients, such as milk powder, milk protein concentrate, whey protein, and casein, are a rich source of essential nutrients, including proteins, amino acids, carbohydrates, minerals, and probiotics. Each of these ingredients has wide applications in the food and beverage industries, including bakery products, confectionery, sports nutrition, and infant formulas.
The dairy ingredients market is segmented by type, application, and geography. Based on type, the market is segmented into milk powders, milk protein concentrates and milk protein isolates, whey ingredients, lactose and derivatives, casein and caseinates, and other types. The whey ingredients segment is further segmented into whey protein concentrate, whey protein isolate, and hydrolyzed whey protein. Based on application, the market is segmented into bakery and confectionery, dairy products, infant milk formula, sports and clinical nutrition, and other applications. Based on geography, the market is segmented into North America, Europe, Asia-Pacific, South America, and Middle-East and Africa.
For each segment, the market sizing and forecasts have been done on the basis of value (in USD million).
| Type | |||||
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| Milk Protein Concentrates and Milk Protein Isolates | |||||
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| Lactose and Derivatives | |||||
| Casein and Caseinates | |||||
| Other Types |
| Application | |
| Bakery and Confectionery | |
| Dairy Products | |
| Infant Milk Formula | |
| Sports and Clinical Nutrition | |
| Other Applications |
| Geography | |||||||||
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Dairy Ingredients Market Research FAQs
How big is the Dairy Ingredients Market?
The Dairy Ingredients Market size is expected to reach USD 62.50 billion in 2024 and grow at a CAGR of 4.06% to reach USD 76.27 billion by 2029.
What is the current Dairy Ingredients Market size?
In 2024, the Dairy Ingredients Market size is expected to reach USD 62.50 billion.
Who are the key players in Dairy Ingredients Market?
Arla Foods amba, Dairy Farmers of America, Fonterra Co-Operative Group Limited, Saputo Inc. and Groupe Lactalis are the major companies operating in the Dairy Ingredients Market.
Which is the fastest growing region in Dairy Ingredients Market?
Asia-Pacific is estimated to grow at the highest CAGR over the forecast period (2024-2029).
Which region has the biggest share in Dairy Ingredients Market?
In 2024, the Europe accounts for the largest market share in Dairy Ingredients Market.
What years does this Dairy Ingredients Market cover, and what was the market size in 2023?
In 2023, the Dairy Ingredients Market size was estimated at USD 60.06 billion. The report covers the Dairy Ingredients Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Dairy Ingredients Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
Dairy Ingredients Industry Report
The Dairy Ingredients Market Analysis report provides an in-depth industry analysis and market forecast for the global market. This market research covers various segments by type, including milk powders, milk protein concentrates and isolates, whey ingredients, lactose and derivatives, casein and caseinates, among others. Additionally, the report examines the application of these ingredients in bakery and confectionery, dairy products, infant milk formula, sports and clinical nutrition, and other applications.
The industry report highlights the market size and market share of dairy ingredients across different regions such as North America, Europe, Asia-Pacific, South America, and the Middle East and Africa. The market trends and market growth are discussed, providing insights into the market outlook and market predictions for the coming years.
The report also provides an industry overview, focusing on market segmentation and market value. Industry statistics and industry information are included to give a comprehensive view of the market dynamics. The industry research includes detailed market data and market review, which are essential for understanding the market leaders and their strategies.
Furthermore, the report example and report PDF offer a sample of the industry reports available for download. This industry outlook and industry sales analysis are crucial for stakeholders looking to make informed decisions based on the latest market forecast and market growth projections. The report concludes with an examination of industry trends and the overall industry size, ensuring a thorough understanding of the dairy ingredients market.
Dairy Ingredients Market Report Snapshots
