Cheese Market Size, Share, Growth & COVID-19 Impact Analysis, By Source (Animal-Based {Cattle, Sheep, Goat, and Camel}, Plant-Based {Soya, Almond, Cashew, and Others}), By Type (Processed and Natural), By Product Type (Cheddar, Mozzarella, Parmesan, Feta, and Others), By Form (Block {Hard and Soft}, Spreadable, and Others), By Distribution Channel (Supermarkets/Hypermarkets, Specialty Stores, Convenience Stores, and Online Retail), and Regional Forecast, 2023-2030

The global cheese market size was valued at USD 183.79 billion in 2022 and is projected to grow from USD 187.42 billion in 2023 to USD 256.99 billion by 2030, exhibiting a CAGR of 4.61% during the forecast period.

Cheese consumption among consumers is rising owing to its versatility and availability of varieties. Furthermore, acceptance of ethnic cuisines such as Italian and Mexican that substantially use more cheese further propels the cheese market growth.

According to the U.S. Department of Agriculture (USDA), in 2020, U.S. per person cheese consumption was 40.2 pounds, a slight increase from the previous year. Cheddar and mozzarella remained the most popular varieties.

COVID-19 IMPACT

Supply & Demand Imbalance Globally Amid COVID-19 to Hamper Industry Growth 

The pandemic affected manufacturers in diverse ways in exporting, importing, and self-sufficient countries. In most exporting countries, such as New Zealand, Germany, the U.S., and others, the shock led to an oversupply of milk and, consequently, to a drop in producers' prices, which was highly significant in some cases. In importing countries, the effect was mainly related to the market channel in which producers participated.

France, country rich with dairy farmers known for their high-quality cheese production, faced issues with product sales during the pandemic.

According to a France Terre de Lait, in the French dairy industry, in 2021, cheese sales dropped nearly 60% during the pandemic due to shrinking international trade and people buying fewer top-dollar products.

Furthermore, high-end specialty cheesemakers found it challenging to sustain in the market. The closure of HoReCa sectors led to a dip in specialty cheese production and sales, and customers were not willing to pay a premium price for specialty products during the pandemic.

Thus, the aforementioned factors adversely affected cheese production during the pandemic.

LATEST TRENDS

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Growing Trend of Artisanal and Functional Varieties to Augment Market Growth

The evolving trend of fresh, homemade, and specialty product varieties is gaining popularity among consumers. These varieties are considered safer owing to their natural processing techniques. Consumer willingness to explore new flavors, an upward trend in eating out, and the growing consumption of foods in which processed cheese is the main ingredient fuel the demand for products.

• According to a survey by the American Cheese Society (ACS), in 2020, 980 artisan cheesemakers in the U.S. produced handmade, naturally flavored, or fresh-from-the-farm products that are becoming increasingly popular among consumers. Consumers buy products for various reasons, from nutrition to convenience to taste. At the same time, consumers are developing new interests and expectations regarding options in the market.

Therefore, rise in artisanal cheesemakers and manufacturers’ focus on launching new products to favor the market growth positively.

DRIVING FACTORS

High Consumption of Natural Cheese to Favor the Market Growth  

Cheese consumption among consumers is rising owing to its versatility and availability of varieties. Furthermore, acceptance of ethnic cuisines such as Italian and Mexican that substantially use more cheese further propels the market growth.

Demand for natural cheese, such as cheddar, parmesan, and others, has increased in recent years owing to enhanced product shelf-life and an attractive flavor profile. The unique flavor profile has increased its usage in local cuisines apart from its regular use in fast food products. Furthermore, the rise in private labels in developing countries and the demand for Western cuisine have boosted the market.

Growing Demand for Plant-based Cheese to Boost the Global Market

Plant-based diets have become mainstream recently, with consumers globally interested in plant-based food. Plant-based cheese is a dairy alternative primarily made from soy, almond, cashew, and others. The growing trend of veganism and rising preference for plant-based food drive the demand for plant-based products. In addition, vegan form is sustainable and eco-friendly compared to dairy-based products and has gained high popularity.

The rise in veganism has led to an increase in plant-based food manufacturers offering various vegan portfolios. This has enabled manufacturers to increase their focus on launching plant-based products, thus propelling the market.

• For instance, in November 2022, Plan B Foods, a Mumbai-based food tech organization, launched a vegan cheese range for Indian consumers, including slices. The newly launched products are available in two formats – cheddar and classic, while its other products include cheddar block, mozzarella block, parmesan block, shreds, and others.

Hence, the rise in veganism and the launch of more plant-based products in the global market are expected to augment the market growth in the coming years.

RESTRAINING FACTORS

Health Risk Associated with Excessive Cheese Consumption and Fluctuation in Raw Material Prices to Hinder Market Growth

Cheese is often regarded as a good source of calcium and protein. Still, it also contains higher amounts of saturated fats and sodium, which, when consumed in excess, can lead to heart disease, diabetes, and high blood pressure. Thus, the rising number of individuals suffering from diabetes and cardiovascular diseases is anticipated to hinder the overall market growth.

• According to the Global Diabetes Community, U.K., in 2018, it was estimated that 415 million people have diabetes worldwide. However, by 2040, the number is anticipated to increase to 642 million people with diabetes worldwide.

Various consumers are allergic to casein, a protein in cheese. An allergic reaction to casein can cause inflammation, rashes, acne, and headaches. In addition, sugar is naturally present in the product which can also cause adverse reactions in lactose-intolerant consumers, thus negatively hampering the market growth.

SEGMENTATION

By Type Analysis

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Growing Demand for Natural Cheese Owing to its Longer Shelf Life and Uniformity in Shape & Size to Drive the Market

Based on type, the market is classified into natural and processed. Cheese made of natural ingredients containing less or no preservatives appeals to health-conscious consumers. Large-scale natural and artisan manufacturers place significant importance on the flavor, texture, and use of herbs, spices, fruits, and nuts instead of artificial ingredients for flavoring. The growing demand for natural cheese is prompting manufacturers to launch new consumer products.

• For instance, in 2021, Sargento Foods launched a natural product, Sargento Creamery Sliced and Shredded form. The newly launched products are available online and in various retail stores across the U.S. 

Processed cheese has been highly adopted in developing Asia Pacific, South America, and the Middle East & Africa regions. The high adoption of processed form can be attributed to its several technical advantages, such as long shelf life, resistance to separation when cooked, and uniformity in shape and size. From the supply point of view, processed form requires a comparatively lower cost of production and distribution than natural form hence can be manufactured in less time.

By Source Analysis

Animal-based Cheese to Dominate the Market Share Owing to its Extensive Availability 

On the basis of source, the market is segmented into animal-based and plant-based. The animal-based segment is further segmented into cattle, sheep, goat, and camel; while the plant-based segment is segmented into soya, almond, cashew, and others.

According to Smart Protein's consumer survey data, European countries often consume dairy-based cheese products, with an estimated 47% of the sample population consuming four times per week. In addition, dairy cheese is highly versatile and can be adapted to any dish, contributing to its popularity. The launch of unique flavored products with attractive packaging and longer shelf life are major factors contributing to the growth of the animal-based segment. 

The plant-based segment is also gaining a foothold in the global market owing to adopting new dietary regimes, such as flexitarian and vegan diets, fueling the market growth. Among different varieties, almond cheese is widely prevalent among consumers. The rising concern related to animal farm-induced global warming and animal cruelty is forcing consumers to adopt cruelty-free, environmentally sustainable products, thus prompting the segment's growth.

By Product Type Analysis

Rising Application of Mozzarella in Various Cuisines and Food Products Drives Sales 

Based on product type, the market is classified into cheddar, mozzarella, parmesan, feta, and others. The type of milk used and the production process impact the cheese's texture and flavor.

Mozzarella accounted for a higher market share as it is widely used in preparing dishes such as home-cooked pasta, pizza, enchiladas, and risotto. Moreover, mozzarella is highly consumed across the world. The growing demand for Western food products in the Asia Pacific and Middle Eastern countries further fuels the adoption of mozzarella and cheddar. 

Parmesan is also popular among cheese lovers due to its hard texture and fruity and nutty taste, which take 2-4 years to process. The product is obtained from cow's milk and can be added to various dishes and snacks.

By Form Analysis

Block Cheese Accounts for Major Share Owing to its Availability in Different Forms

Based on form, the market is segmented into the block, spreadable, and other.

Block cheese is available in hard and soft forms. Some popular hard cheeses included in the market study are parmesan and feta. These products are highly nutritious and require longer ripening periods. They have low water content and can be grated and applied on various dishes. Soft cheese includes ricotta, cheddar, mozzarella, and camembert.

The spreadable segment is expected to register higher growth during the forecast period.

The spreadable segment is gaining significant popularity in the market as it can be easily applied to food items such as sandwiches, cakes, and snacks. These products are available in a wide range of flavors and are readily available in various stores.

By Distribution Channel Analysis

Extensive Product Availability & Product Choices Fuel Sales Growth through Supermarkets/Hypermarkets

On the basis of distribution channel, the market is segmented into supermarkets/hypermarkets, specialty stores, convenience stores, and online retail.

The supermarkets/hypermarkets segment dominates the distribution channel through which consumers prefer to purchase their products as they can choose from a wide variety of products and even try the free sample offered in some of these outlets. Consumers also adopt convenience stores for purchasing cheese products.

Specialty stores are becoming popular among consumers, providing local, imported, artisanal, and specialty cheese products. Some of these stores are also developing hybrid spaces that provide cheese, and limited food items such as sandwiches, and wine, improving consumer's purchase experience.

The consumer purchase pattern is changing significantly, and more consumers are purchasing products through online stores or adopting both offline and online stores. The COVID-19 pandemic shaped purchase behavior, with more consumers shifting toward online channels to search for and purchase products. Thus, various manufacturers are also advancing their presence in the online platform by introducing product offers and targeted marketing for consumers.

REGIONAL INSIGHTS

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The global market is analyzed across Europe, North America, Asia Pacific, South America, and the Middle East & Africa.

European consumers opt for healthy foods to maintain physical health and well-being with beneficial traits such as organic and non-GMO retail positioning, positively impacting the Europe cheese market share.

In Europe, key players such as Wensleydale Creamery, ELSA MIFROMA, Kingsoft Dairy, and Pilgrims Choice operating in the market are focusing on diversification of product portfolio, along with investing in partnerships and acquisition activities to maintain their regional prominence in the Europe market.

• In October 2019, Wensleydale Creamery launched a new brand of cheese, the Yorkshire Creamery, along with a new range of products, including extra red Yorkshire, mature cheddar, and double Yorkshire.

In North America, consumer demand increased for convenience and nutritious food products to promote market growth. Cheese is a primary ingredient in food products such as pizza, sandwiches, and similar products. In North America, the acceptance of such food products led to augmented sales of cheese products. Moreover, various manufacturers have introduced wide flavors of the product.

Moreover, North America is one of the major markets, primarily driven by the millennials' constantly changing snack and dessert consumption habits. The increasing popularity of on-the-go snacking consumption among American millennials has pushed demand for cheese pizza and sandwiches, which would help in the growth of the North American market.

Asia Pacific is an extensive and diversified region that has offered massive opportunities for dairy market manufacturers and exporters for the past few years. To achieve most of the opportunities, the market follows the key strategies which ensure food quality and safety along with the functional benefits of the products. Demand for functional products with "natural claims" and other health-imparting benefits, such as non-GMO or probiotic-enriched products, is rapidly growing. Furthermore, the growing number of new and innovative products increases awareness of different product types in developing economies such as India, Japan, Singapore, and China.

Brazil, Argentina, and Uruguay are some of the significant dairy-producing nations in the region, which creates an opportunity for dairy producers to develop indigenously made cheese for the local market. As the cost of imported cheese from Europe and North America is high, developing local products make the product affordable for consumers in the region.

The Middle East & Africa region has experienced good economic growth recently. The Middle East & Africa is home to a few of the fastest-growing economies globally such as Turkey, Egypt, South Africa, the UAE, Israel, and Cyprus. The market in the Middle East and Africa is witnessing substantial growth as it plays a key role in the daily diet, offering different flavors with several nutritional benefits. Millennials from the Middle East are inclined toward healthy snacking, as cheese-used snacks are more often considered a snack, and thus the demand is anticipated to grow during the next several years.

KEY INDUSTRY PLAYERS

Key Players Focus on Product Launches to Stay Competitive

Key industry participants adopt various competitive strategies, such as new product launches, that assist market players in unlocking various business opportunities through diversified product reach with a wide distribution channel in the market owing to the presence of retailers and e-commerce globally. The companies are progressively focusing on new product launches and development in the plant-based category owing to the rising demand for sustainable and cruelty-free products in the dairy alternative industry. Consumers' rising inclination toward vegan products has contributed to growing investment in plant-based product development.

List of Key Companies Profiled:

• The Kraft Heinz Company (U.S.)


• Fonterra Co-operative Group Limited (New Zealand)


• Arla Foods amba (Arla Foods Group) (Germany)


• FrieslandCampina (Netherlands)


• Saputo Inc. (Canada)


• Lactalis Ingredients (France)


• Wensleydale Creamery (U.K.)


• Dairy Farmers of America, Inc. (U.S.)


• SAVENCIA SA (France)


• Norseland Ltd (Tine Group) (U.K.)

KEY INDUSTRY DEVELOPMENTS:

• January 2023: Emmi Roth, one of the leading providers of specialty cheese, launched new products under its popular brand Roth. The new products launched include Tomato Basil Havarti and French Onion Havarti. The new product launch was primarily to attract more consumers owing to the increasing application of specialty products in fast food, snacks, and others.


• October 2021: Agropur announced its plan to construct a cheese factory in Little Chute for USD 168 million. The construction of a new factory aims to meet the increased production of dairy products to meet consumer demand in the U.S.


• October 2021: Lactalis Group acquired the European cheese brand Leerdammer for USD 533.745 million. Through this acquisition, Lactalis gained access to the Dutch market. The acquisition also enabled Lactalis Group to establish itself at the industrial level in the Netherlands and boosted its activity in Germany, Ukraine, and Italy.


• September 2021: Lactalis Canada launched two direct-to-consumer e-commerce platforms, Cheeseworld.ca and DairyMarketCulinary.ca. Cheeseworld.ca is an online specialty cheese store offering a wide array of heritage cheese. Consumers receive a specialty cheese shop experience combined with the convenience of online shopping and home delivery.


• The company's entry into e-commerce has enabled it to be available to consumers in Montreal and Greater Toronto and cater to consumer requirements looking for new product discoveries.


• September 2020: Lactalis entered into a definitive agreement to acquire Kraft Heinz's natural, grated, cultured, and specialty cheese businesses in the U.S. With this acquisition, the firm aims at domestic and international expansion and product innovation.

REPORT COVERAGE

An Infographic Representation of Cheese Market

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The report provides a detailed analysis of the global market. It focuses on various aspects such as leading companies, the global dairy market, dairy products overview, the supply chain landscape, regulatory analysis, and key distribution channels. Besides, the report offers insights into the market trends and key industry developments. In addition, the report includes several factors that contributed to the market's growth in recent years.

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