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United Kingdom Dairy Market Size

The United Kingdom dairy market is experiencing growth, with its market size projected to expand over the forecast period. The off-trade distribution channel, particularly through supermarkets and hypermarkets, plays a significant role in the consumption of dairy products. The expansion of these retail formats has positively influenced the market's growth. Additionally, the increasing popularity of online retail as a sales channel is contributing to the market's expansion. Despite a temporary decline in the on-trade distribution channel due to reduced demand during the pandemic, the market has rebounded, supported by a resurgence in restaurant and cafe spending.

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Market Size of united kingdom dairy Industry

United Kingdom Dairy Market Summary
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svg icon Study Period 2017 - 2029
svg icon Market Size (2024) USD 23.03 Billion
svg icon Market Size (2029) USD 27.34 Billion
svg icon Largest Share by Distribution Channel Off-Trade
svg icon CAGR (2024 - 2029) 3.49 %
svg icon Fastest Growing by Distribution Channel Off-Trade
svg icon Market Concentration Low

Major Players
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*Disclaimer: Major Players sorted in no particular order

Key Players

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United Kingdom Dairy Market Analysis

The United Kingdom Dairy Market size is estimated at 23.03 billion USD in 2024, and is expected to reach 27.34 billion USD by 2029, growing at a CAGR of 3.49% during the forecast period (2024-2029).

23.03 Billion

Market Size in 2024 (USD)

27.34 Billion

Market Size in 2029 (USD)

2.41 %

CAGR (2017-2023)

3.49 %

CAGR (2024-2029)

Largest Market by Category

29.09 %

value share, Cheese, 2023

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Product consistency, surge in regional production and increasing cheese use in different cuisines are some of the major factors influencing the higher cheese consumption.

Largest Market by Distribution Channel

83.29 %

value share, Off-Trade, 2023

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The product assortment and shelf space in off-trade retail channels is allowing consumers to compare the products, which has emerged to be one of the major factor driving segmental growth.

Fastest-growing Market by Category

5.82 %

Projected CAGR, Sour Milk Drinks, 2024-2029

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Improved dietary choices due to rising health concerns among the country is one of the major factor driving the preference towards sour milk drinks in the region.

Fastest-growing Market by Distribution Channel

3.67 %

Projected CAGR, Off-Trade, 2024-2029

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The wider range of dairy products provided by major off-trade channels like convenience stores with reliable shelf space and product assortment entices consumers with wider options.

Leading Market Player

6.95 %

market share, Arla Foods, 2022

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Arla's strategic approach to target the specific consumers along with the reduced impact on the environment and climate with improved food safety is making company grow in the market.

Strong penetration of organized retail channels fueling the market growth

  • In the United Kingdom, the off-trade distribution channel is the primary channel through which dairy products are more consumed in the country. Of all the sub-types of the off-trade channel, supermarkets and hypermarkets are the major channels. The growth of these retail formats, along with factors like business expansion and the increase in supermarkets and hypermarkets, positively impacted the dairy products market in the United Kingdom. As of 2022, Tesco has a total of 2,823 supercenter stores throughout the country.
  • Different supermarket and hypermarket chains, like Tesco, Sainsbury, Asda, Morrisons, and Lidi, offer loyalty benefits to retain consumers. Tesco and Sainsbury's had the largest share, with a 43% share of the grocery market in 2021.
  • The United Kingdom is the leading market in Europe when it comes to online shopping. Online retail stores as a sales channel are gaining popularity across the country. In 2021, the overall revenue of e-commerce in the United Kingdom reached a total of USD 156 billion from USD 135 billion in 2020.
  • In 2020, there was a sudden fall in the growth trend of dairy products for the on-trade distribution channel in the United Kingdom due to the decline in the demand for foodservice channels. Post-COVID-19, the market has witnessed a speedy recovery. This is due to the increasing frequency of restaurants offering various ethnic foods, such as Asian, American, Chinese, Japanese, and Thai cuisines, coupled with a growing expat population. Spending on restaurants and cafes in the United Kingdom reached USD 111.34 billion in 2021 compared to USD 78.16 billion in 2020.
United Kingdom Dairy Market

United Kingdom Dairy Industry Segmentation

Butter, Cheese, Cream, Dairy Desserts, Milk, Sour Milk Drinks, Yogurt are covered as segments by Category. Off-Trade, On-Trade are covered as segments by Distribution Channel.

  • In the United Kingdom, the off-trade distribution channel is the primary channel through which dairy products are more consumed in the country. Of all the sub-types of the off-trade channel, supermarkets and hypermarkets are the major channels. The growth of these retail formats, along with factors like business expansion and the increase in supermarkets and hypermarkets, positively impacted the dairy products market in the United Kingdom. As of 2022, Tesco has a total of 2,823 supercenter stores throughout the country.
  • Different supermarket and hypermarket chains, like Tesco, Sainsbury, Asda, Morrisons, and Lidi, offer loyalty benefits to retain consumers. Tesco and Sainsbury's had the largest share, with a 43% share of the grocery market in 2021.
  • The United Kingdom is the leading market in Europe when it comes to online shopping. Online retail stores as a sales channel are gaining popularity across the country. In 2021, the overall revenue of e-commerce in the United Kingdom reached a total of USD 156 billion from USD 135 billion in 2020.
  • In 2020, there was a sudden fall in the growth trend of dairy products for the on-trade distribution channel in the United Kingdom due to the decline in the demand for foodservice channels. Post-COVID-19, the market has witnessed a speedy recovery. This is due to the increasing frequency of restaurants offering various ethnic foods, such as Asian, American, Chinese, Japanese, and Thai cuisines, coupled with a growing expat population. Spending on restaurants and cafes in the United Kingdom reached USD 111.34 billion in 2021 compared to USD 78.16 billion in 2020.
Category
Butter
By Product Type
Cultured Butter
Uncultured Butter
Cheese
By Product Type
Natural Cheese
Processed Cheese
Cream
By Product Type
Double Cream
Single Cream
Whipping Cream
Others
Dairy Desserts
By Product Type
Cheesecakes
Frozen Desserts
Ice Cream
Mousses
Others
Milk
By Product Type
Condensed milk
Flavored Milk
Fresh Milk
Powdered Milk
UHT Milk
Sour Milk Drinks
Yogurt
By Product Type
Flavored Yogurt
Unflavored Yogurt
Distribution Channel
Off-Trade
Convenience Stores
Online Retail
Specialist Retailers
Supermarkets and Hypermarkets
Others (Warehouse clubs, gas stations, etc.)
On-Trade
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United Kingdom Dairy Market Size Summary

The United Kingdom dairy market is experiencing a steady growth trajectory, driven by the expansion of off-trade distribution channels, particularly supermarkets and hypermarkets. These retail formats, including major players like Tesco, Sainsbury, Asda, Morrisons, and Lidl, have significantly contributed to the market's development by offering loyalty benefits to consumers. The rise of online shopping has further bolstered the market, with e-commerce becoming an increasingly popular sales channel. The post-COVID-19 recovery has been notable, with a resurgence in demand for dairy products in foodservice channels, supported by a diverse range of ethnic cuisines and a growing expat population. This recovery has been accompanied by an increase in per capita dairy consumption, driven by the rising popularity of bakery products, including dairy desserts like mousses and cheesecakes.

The market is characterized by a fragmented landscape, with key players such as Arla Foods, Danone SA, Muller Group, Saputo Inc., and Unilever PLC holding a significant share. The demand for cheese and butter-based snack products has led to fluctuations in their prices, reflecting changing consumer preferences. The import volume of dairy products has risen, with the UK increasing its imports to meet the growing demand for baked foods and cheese-based products. Investments in state-of-the-art production facilities, such as Ornua Foods UK's expansion of cheese-grating capabilities, highlight the industry's focus on enhancing production capacity. The market's dynamic nature is further underscored by strategic expansions and innovations, such as Bel UK's launch of flavored hot cheese bites, indicating a robust outlook for the UK dairy sector.

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United Kingdom Dairy Market Size - Table of Contents

  1. 1. MARKET SEGMENTATION (includes market size in Value in USD and Volume, Forecasts up to 2029 and analysis of growth prospects)

    1. 1.1 Category

      1. 1.1.1 Butter

        1. 1.1.1.1 By Product Type

          1. 1.1.1.1.1 Cultured Butter

          2. 1.1.1.1.2 Uncultured Butter

      2. 1.1.2 Cheese

        1. 1.1.2.1 By Product Type

          1. 1.1.2.1.1 Natural Cheese

          2. 1.1.2.1.2 Processed Cheese

      3. 1.1.3 Cream

        1. 1.1.3.1 By Product Type

          1. 1.1.3.1.1 Double Cream

          2. 1.1.3.1.2 Single Cream

          3. 1.1.3.1.3 Whipping Cream

          4. 1.1.3.1.4 Others

      4. 1.1.4 Dairy Desserts

        1. 1.1.4.1 By Product Type

          1. 1.1.4.1.1 Cheesecakes

          2. 1.1.4.1.2 Frozen Desserts

          3. 1.1.4.1.3 Ice Cream

          4. 1.1.4.1.4 Mousses

          5. 1.1.4.1.5 Others

      5. 1.1.5 Milk

        1. 1.1.5.1 By Product Type

          1. 1.1.5.1.1 Condensed milk

          2. 1.1.5.1.2 Flavored Milk

          3. 1.1.5.1.3 Fresh Milk

          4. 1.1.5.1.4 Powdered Milk

          5. 1.1.5.1.5 UHT Milk

      6. 1.1.6 Sour Milk Drinks

      7. 1.1.7 Yogurt

        1. 1.1.7.1 By Product Type

          1. 1.1.7.1.1 Flavored Yogurt

          2. 1.1.7.1.2 Unflavored Yogurt

    2. 1.2 Distribution Channel

      1. 1.2.1 Off-Trade

        1. 1.2.1.1 Convenience Stores

        2. 1.2.1.2 Online Retail

        3. 1.2.1.3 Specialist Retailers

        4. 1.2.1.4 Supermarkets and Hypermarkets

        5. 1.2.1.5 Others (Warehouse clubs, gas stations, etc.)

      2. 1.2.2 On-Trade

United Kingdom Dairy Market Size FAQs

The United Kingdom Dairy Market size is expected to reach USD 23.03 billion in 2024 and grow at a CAGR of 3.49% to reach USD 27.34 billion by 2029.

In 2024, the United Kingdom Dairy Market size is expected to reach USD 23.03 billion.

United Kingdom Dairy Market Report Snapshots

United Kingdom Dairy Market SIZE & SHARE ANALYSIS - GROWTH TRENDS & FORECASTS UP TO 2029