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Dairy Foods Market Size, Share & COVID-19 Impact Analysis By Source (Cattle, Sheep, Goat, and Camel), By Type (Lactose and Lactose-Free), By Product Type (Milk, [Powder, and Liquid], Cheese, Butter, Dessert, Yogurt, and Others), By Distribution Channel (Supermarkets/Hypermarkets, Specialty Stores, Convenience Stores, and Online Retail), and Regional Forecast, 2023-2030

Last Updated: June 24, 2024 | Format: PDF | Report ID: FBI103890

 

KEY MARKET INSIGHTS

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The global dairy foods market size was valued at USD 827.89 billion in 2022 and is projected to grow from USD 890.15 billion in 2023 to USD 1,374.37 billion by 2030, exhibiting a CAGR of 6.40% during the forecast period. Asia Pacific dominated the dairy foods market with a market share of 41.22% in 2022.


The dairy food industry includes milk production, preparation for sale, and manufacturing of dairy products. It includes a variety of products, such as milk, yogurt, cheese, spreads, ice creams, and others. The demand for these products is continuously growing, especially in developing countries, due to the higher nutritional value of milk and related foods. Market players are focusing on launching new dairy products in untapped regions to expand their customer base and market presence. Innovative and unique marketing strategies are anticipated to increase manufacturers' global reach and offer them lucrative opportunities to promote and sell their dairy products during the forecast period.


COVID-19 IMPACT


COVID-19 Pandemic Disrupted Dairy Foods Supply Chain and Restricted Market Growth


The COVID-19 pandemic significantly affected different industries, including the dairy foods sector. This was owing to the restrictions imposed by governments to limit social gatherings and curb the spread of the virus. Furthermore, several factors, such as limited production due to labor shortage, reduced supply of raw materials, and others had a major impact on the product supply. The pandemic affected manufacturers of dairy products, such as cheese, butter, and others in several areas, including production, export, and import. In countries, such as New Zealand, India, Germany, China, and the U.S., which are significant dairy food producers, a sudden dip in the production of processed dairy products led to an oversupply of milk in storage and processing facilities.


For instance, as per the Dairy Farmers of America, the pandemic, which caused several challenges and closed down hotels, restaurants, and manufacturing facilities, created an oversupply of milk. This scenario resulted in farmers' clearance of around 3.7 million gallons of milk each day.


LATEST TRENDS


Trend of Growing Demand for Premium and Personalized Dairy Products


Countries, such as the U.S., Germany, Italy, France, Spain, and others have recorded a robust change in consumer demand for these products. The pandemic significantly increased consumers’ need for a healthy and nutrition-based diet. Thus, the demand for premium, personalized, and high-quality nutrition-based dairy products has seen rapid growth. To cater to the changing consumer preferences, market players are launching new products to attract more customers. For instance, in September 2022, Milkymist, a well-known dairy product manufacturer based in Europe, announced the launch of an all-new high-protein yogurt under its brand called Skyr. As per the announcement made by the company, the new yogurt is the only one in the European market with 11% protein content.


The demand for sustainable dairy production is rapidly growing among consumers owing to the increasing awareness of the negative impact of the dairy industry on the environment. Furthermore, rising number of awareness campaigns by PETA are contributing to the growing demand for sustainable dairy foods. In addition, the rising percentage of lactose-intolerant people globally has fueled the demand for lactose-free dairy products, such as cheese, dessert, yogurt, and others. This factor will further fuel the global dairy foods market growth.


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DRIVING FACTORS


Population and Income Growth in Emerging Countries to Drive Market Progress


As per the U.S. Census Bureau data, Asia Pacific has the highest share of the global population, accounting for around 45.78% in 2023. This is primarily due to the presence of extremely populated countries, such as China and India. These countries have a rising infant and young population, which has been driving the consumption of dairy products at a strong pace.


For instance, as per the U.S. Census Bureau, China and India accounted for 17.70% and 17.53% of the global population, respectively, in 2022.


In addition, as per the Government of India, around 70% of milk produced in the country is self-consumed. Thus, growing population is driving the growth of this market.


Countries in South America are known to have the highest number of people living in urban cities. Countries, such as Brazil, Chile, and Argentina are attracting large FDIs with the launch of new startups in food technology, dairy, and e-commerce. Thus, rapid growth of the country’s economy and higher urban population share are driving the consumption of dairy foods in the region.


For instance, as per Cargill’s Dairy White Paper, Latin America is the most diverse dairy market, with the most relevant and promising markets being Brazil, Argentina, and Chile.


Strong Culture of Dairy Products in Developed Countries to Drive Market Growth


Dairy products, such as cheese, dessert, butter, and others have been culturally important in North American countries, such as the U.S., Canada, and Mexico. The consumption of milk has been increasing constantly in the region over the last few years. For instance, as per Cargill’s Dairy White Paper, 90% of Americans drink milk daily. The European population is quite inclined toward the nutritional aspects of these products. Thus, the higher demand for whey and fresh milk will significantly contribute to the dairy food market growth in the region in the coming years.


In addition, European cuisine uses a lot of cheese; the region is one of the major cheese consumers. The high demand for cheese is owing to the majority of this product originating from the European region, thus making it a major part of its cuisine.


For instance, according to the International Dairy Foods Association, the Gorgonzola cheese was made in 879 A.D. in Po Valley, Italy. After this, Italy became the center of cheese-making in Europe in the 10th century.


RESTRAINING FACTORS


Shift in Consumer Preference Toward Plant-based Alternatives to Restrain Market Growth


The rising lactose-intolerant and dairy-sensitive population has been an important factor in the rapid growth of plant-based foods in recent years. Plant-based dairy products have recorded a strong penetration rate, especially in North American and European countries. Plant-based products are now found in several retail stores, cafés, and restaurants. Many food service outlets have launched new plant-based beverage ranges to cater to the evolving demands of their consumer base.


For instance, in January 2020, Starbucks Corporation announced the launch of its oat milk-based beverage due to the rising demand for vegan milk among consumers. Furthermore, in December 2021, the company announced that it had dropped the supercharge on its plant-based milk beverages in the U.K.


Thus, the rapid adoption of plant-based dairy products and their rising penetration in developed and developing markets will restrain the growth of this market.


SEGMENTATION


By Source Analysis


Cattle to be Major Source of Dairy Products Due to Its Health Benefits


Based on source, the market is divided into cattle, sheep, camel, and goats.


The cattle segment dominates the market as it is considered the most efficient in transforming all the feed protein into food as compared to the other farm livestock. In addition, numerous sources are available for milk production, but most consumers prefer consuming cattle milk owing to its several health benefits. Cattle’s milk consists of higher amounts of vitamins and minerals and is easily digestible due to lower content of protein and fats as compared to the other types of milk. Also, cattle milk, such as cow’s milk, has a higher water proportion than that of goat’s and camel’s milk. Owing to this, cow’s milk is less fattening, and thus, it is preferred more, especially by fitness enthusiasts. Apart from this, the easy accessibility of cattle’s milk will further fuel its consumption rate across the global market.


Sheep milk is another preferred source of dairy products as modern consumers are gravitating toward its health-promoting properties, which makes it one of the most appropriate alternatives for customers. Many researchers suggest that the production of cheeses with “raw, non- pasteurized sheep milk” can offer higher amounts of Vitamin A, larger volume of protein (almost double), conjugated linoleic acid, and angiotensin-converting enzyme (ACE)-inhibitory peptides than those present in cattle and goat’s milk. Apart from these factors, goat and camel milk are also consumed across the globe due to their unique nutritional properties.


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By Type Analysis


Lactose-based Dairy Foods to Gain Significant Momentum Owing to Their High Consumption


Based on type, the market is segregated into lactose and lactose-free dairy foods.


The lactose segment held the largest market share. Lactose is a type of sugar consisting of galactose and glucose, which act as an energy transmitter in milk. It also provides various health benefits, such as strengthening the absorption of vitamins and minerals, such as manganese, calcium, and zinc, supporting immune function, and shaping the intestinal microbiota. Besides its application in human food, lactose is also highly used in the pharmaceutical and food processing industries, where it is used as a sweetener or in tablet formulation.


Lactose-free dairy foods have also become mainstream, primarily due to the rising cases of lactose intolerance across the globe. The newly emerging lactose-free milk has nearly the same nutrient profile as cow’s milk, except for the lactose sugar. Like normal cow’s milk, lactose-free milk also provides calcium, phosphorus, and vitamins A, D, and B12. The major advantage of this type of milk is its easy digestibility as compared to regular milk, which will further increase consumer demand.


By Product Type Analysis


Milk to Gain Significant Popularity Due to its Versatility


Based on product type, the market is classified into milk, cheese, butter, dessert, yogurts, and others. The milk segment is leading the market owing to its versatile nature. Milk is the most consumed dairy item since ages as it is has one of the most essential nutrients, such as vitamins and minerals, especially calcium. Milk is one of the multi-purpose products that can be used in a wide range of foods, ranging from savory to sweet items. Cheese is another widely used milk product as it is one of the most nutrient-dense foods that provides ample amounts of protein, minerals, and fats. Similar to milk, cheese also provides a great amount of protein and calcium, which is required for muscle and bone health. The most commonly used cheeses include Mozzarella, Swiss, and Cheddar, which are extensively used in various food items, such as burgers, pizza, and tacos.


By Distribution Channel Analysis


Supermarkets/ Hypermarkets to Remain Dominant Owing to Their Ease of Access


Based on distribution channel, the market is segmented into supermarkets/hypermarkets, convenience stores, online retail, and others. The supermarkets/hypermarkets segment has generated the maximum profit due to the availability of various products and easy accessibility to them. Supermarkets are generally large-scale stores that offer essential and convenience products. The major advantage of visiting a supermarket is that consumers can easily get all their essential items under one roof, saving them a lot of energy and time.


The convenience stores segment is also growing steadily as these stores offer a wide range of discounts on the product purchased, which helps consumers purchase high-quality items at reasonable prices.


REGIONAL INSIGHTS


Asia Pacific Marine Collagen Market Size, 2019-2030 (USD Million)

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Asia Pacific held a major global dairy foods market share in 2022. The dairy industry of Asian countries has been recognized as the largest sector globally due to the large scale consumption of these products and their several benefits. This evolution of the dairy sector can be attributed to its vast local consumer base, rapid growth in population, and increasing trend of adopting western lifestyle. Moreover, consuming protein-rich foods is the prime focus of the diet of a health-conscious person in today’s times as modern consumers are seeking a variety of “protein-rich items” to maintain a sustainable lifestyle. According to the Friesland Campina Reports, 2020, a Dutch-based dairy co-operative, an increase of about 0.6% was observed in the demand for milk-based products as compared to the 2019 reports. Also, according to the data, Asia Pacific maintained its position as the fastest-growing market, especially in the dairy sector.


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North America, which includes the U.S., Canada, and Mexico, is expected to experience steady growth. The growing milk production capacity, vast dairy product portfolio, and adoption of efficient farming practices will help the U.S. secure a prominent position in the global cow’s milk production. Throughout the dairy industry’s supply chain, ranging from farm to milk producers to product formulators, there is an inflow of huge investments in the U.S. dairy industry that help drive the dairy business in the region. After being a major importer of dairy products since a decade, the U.S. market achieved an all-time high record of exports of these products. The exports were valued at around USD 9.5 billion in 2022 and reached nearly 141 countries, as per the International Dairy Foods Association.


Europe is known to be the second largest milk-producing region in the world owing to its diverse portfolio, high-quality production, and stringent safety standards deployed by member nations. According to the European Dairy Association, in 2021, the combined markets of the EU-27 produced 145 million metric tonnes of dairy products. France is known for its rich cheese culture and produces a wide variety of high-quality cheeses, which are enjoyed both domestically and internationally. According to the Organization of Economic Co-operation and Development (OECD), in 2021, France imported USD 2.5 billion worth of cheese, and major imports were from Italy, Netherlands, Germany, Belgium, and Spain.


The South American dairy industry is one of the largest contributors to the South American economy by being one of the prominent dairy products consuming regions globally. Brazil is one of the most densely populated nations in South America, with nearly 214 million people, and the dairy consumption in the country is growing at a stable pace.


The Middle East is recognized as the most promising market in the dairy sector. This is because a continuous shift has been observed in the consumer’s eating patterns, with more moving away from a traditional diet to a healthier, convenient, and high-quality diet. The region is continuously growing with a strong demand for unique foods, such as flavorful and organic dairy products. Another major factor responsible for driving the market’s growth is the customers’ changing lifestyle and rising disposable income.


KEY INDUSTRY PLAYERS


Key Players to Focus on Product Development in New Regions to Stay Competitive


The market comprises local players, and the number of these players exceeds that of international players. Local companies are continuously trying to expand their inter-country food business footprint in new countries. Considering the increasing demand for various products, key players are making their products available in international markets by entering partnerships with other local players to launch new products in the respective markets. For example, in March 2022, Fonterra launched its New Zealand high-end cheese brand “Kapiti” in China’s retail market, which is expected to meet the rising demand for high-end cheese products in China.


List of Key Companies Profiled:



KEY INDUSTRY DEVELOPMENTS:



  • May 2023: Aavin is a state government co-operative that announced the launch of its all-new milk products fortified with vitamins A and D. As per the company, these new launches are to estimate the demand for fortified milk products in the market.

  • August 2022: Dairy Farmers of America (DFA) acquired two Extended Shelf-Life (ESL) processing facilities from Smith Foods. The two processing plants are in Pacific (Missouri) and Richmond (Indiana) in the U.S. These facilities became part of the DFA’s dairy brands division and operated as Pacific Dairy Solutions and Richmond Beverage Solutions.

  • October 2022: Unilever partnered with ASAP to distribute its ice creams. Under the partnership, ASAP will also deliver ice cream and snacks from Unilever's virtual store, The Ice Cream Shop.

  • July 2022: GCMMF launched over 100 products, including products from different categories. These products include milk items in several variants of ginger, tulsi, and turmeric. Out of these 100 products, most of the products are milk-based. Therefore, this product launch helped the company expand its business through the expansion of its product portfolio.

  • October 2021: Lactalis Group acquired the European cheese brand Leerdammer for USD 533.745 million. Through this acquisition, Lactalis gained access to the Dutch cheese 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.


REPORT COVERAGE


An Infographic Representation of Dairy Foods Market

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The research report provides a detailed analysis of the market and focuses on key aspects, such as key players, sources, product types, competitive landscape, product application areas, and market share. Besides this, the report offers insights into the market drivers and dairy foods industry trends, and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several factors that have contributed to the market's growth in recent years.


Report Scope & Segmentation






















































ATTRIBUTE



DETAILS



Study Period



2019-2030



Base Year



2022



Estimated Year



2023



Forecast Period



2023-2030



Historical Period



2019-2021



Growth Rate



CAGR of 6.40% from 2023 to 2030



Unit



Value (USD Billion)



Segmentation



By Source



  • Cattle

  • Sheep

  • Goat

  • Camel



By Type



  • Lactose

  • Lactose-Free



By Product Type



  • Milk

    • Powdered

    • Liquid



  • Cheese

  • Butter

  • Dessert

  • Yogurt

  • Others



By Distribution Channel



  • Supermarket/Hypermarket

  • Specialty Stores

  • Convenience Stores

  • Online Retail



By Region


North America (By Source, Type, Product Type, Distribution Channel, and Country)



  • U.S.(By Type)

  • Canada (By Type)

  • Mexico (By Type)


Europe (By Source, Type, Product Type, Distribution Channel, and Country)



  • U.K. (By  Type)

  • France (By Type)

  • Italy (By Type)

  • Spain (By  Type)

  • Russia (By Type)

  • Rest of Europe (By Type)


Asia Pacific (By Source, Type, Product Type, Distribution Channel, and Country)



  • China (By Type)

  • India (By Type)

  • Japan (By  Type)

  • Australia (By Type)

  • Rest of Asia Pacific (By Type)


South America (By Source, Type, Product Type, Distribution Channel, and Country)



  • Brazil (By  Type)

  • Argentina (By Type)

  • Rest of South America (By Type)


Middle East and Africa (By Source, Type, Product Type, Distribution Channel, and Country)



  • UAE  (By Type)

  • South Africa  (By Type)

  • Rest of Middle East & Africa (By Type)






Frequently Asked Questions

The Fortune Business Insights study shows that the market size was valued at USD 827.89 billion in 2022.

The market is likely to record a CAGR of 6.40% over the forecast period of 2023-2030.

The lactose segment was the leading type segment in this market.

Population and income growth in various regions will drive the market growth.

Dairy Farmers of America, Inc., Fonterra Co-operative Group Limited, and Nestle S.A. are the major players in the market.

Asia Pacific dominated the market in terms of sales in 2022.

The shift in consumer preference toward plant-based alternatives is expected to restrain the market growth.

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