Canada Dairy Market Size and Share
Market Overview
| Study Period | 2020 - 2030 |
|---|---|
| Base Year For Estimation | 2024 |
| Forecast Data Period | 2025 - 2030 |
| Market Size (2025) | USD 16.20 Billion |
| Market Size (2030) | USD 21.30 Billion |
| Growth Rate (2025 - 2030) | 5.63% CAGR |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0. |
|
Canada Dairy Market Analysis by Mordor Intelligence
The Canada dairy market reached USD 16.20 billion in 2025 and is projected to grow at a CAGR of 5.63% to USD 21.30 billion by 2030. The market demonstrates robust growth fundamentals, supported by widespread household consumption of fluid milk products, substantial recovery in the foodservice industry following market disruptions, and significant improvements in operational efficiency through strategic technology adoption. The market's expansion is characterized by increasing consumer preference for premium products, particularly in categories such as organic dairy, lactose-free alternatives, and functional dairy offerings that provide additional health benefits. Manufacturing facilities and dairy farms are extensively implementing process automation systems to optimize operational costs and maintain consistent product quality, enabling companies to preserve profit margins despite ongoing volatility in input costs. The market is witnessing a notable shift in consumer behavior, particularly in urban regions, with increasing demand for convenient, ready-to-consume dairy products, which has substantially boosted sales through convenience retail outlets and e-commerce channels. Additionally, dairy processors are making substantial investments in advanced methane reduction technologies and renewable energy systems to address growing environmental concerns and strengthen their competitive position in the market.
Key Report Takeaways
- By product type, milk led with a 68.61% share in 2024 in the Canadian dairy market; yogurt is projected to expand at a 7.01% CAGR through 2030.
- By distribution channel, off-trade outlets dominated with a 75.23% share in 2024, while on-trade revenues are growing at a CAGR of 6.74% through 2030.
Canada Dairy Market Trends and Insights
Drivers Impact Analysis
| Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Adoption of advanced processing technology and automation in dairy farms | +1.2% | National, with early adoption in Ontario & Quebec | Medium term (2-4 years) |
| Rising consumer preference for organic and natural dairy products | +0.9% | Urban centers, particularly Toronto, Vancouver, Montreal | Short term (≤ 2 years) |
| Increased demand for lactose-free and functional dairy options | +1.1% | National, with higher penetration in Western provinces | Medium term (2-4 years) |
| Growth in sustainable and environmentally friendly production practices | +0.8% | National, with regulatory push in British Columbia | Long term (≥ 4 years) |
| Urbanization leading to demand for convenient, ready-to-consume dairy formats | +1.0% | Major metropolitan areas across all provinces | Short term (≤ 2 years) |
| Focus on traceability and transparency in ingredient sourcing | +0.7% | National, with premium positioning in urban markets | Medium term (2-4 years) |
| Source: Mordor Intelligence | |||
Advanced Processing Technology and Automation Drive Operational Excellence
Canadian dairy farms are experiencing a transformative period through technological advancement, with robotic milking systems adoption showing substantial year-over-year growth since 2024. Ontario and Quebec are spearheading this evolution, where automated milking parlors now manage a significant portion of provincial milk production. These systems have delivered considerable reductions in operational costs while enhancing overall milk quality standards [1]Source: Ontario Dairy Council, “Technology Adoption in Dairy Farming,” ontariodairy.ca. The implementation of artificial intelligence for feed optimization and herd health monitoring has revolutionized livestock management practices, enabling farmers to monitor individual cow performance and wellness through continuous data collection. This technological progression effectively addresses the persistent challenge of labor shortages while strengthening the position of Canadian dairy operations in the global market, particularly as international trade agreements continue to evolve and create new opportunities for market access.
Organic and Natural Product Preferences Reshape Consumer Purchasing Patterns
The organic dairy market in Canada demonstrated substantial expansion in 2024, reflecting a notable increase in consumer demand. Organic milk sales achieved record-breaking revenue nationally, with consumption primarily concentrated among younger consumers in metropolitan regions [2]Source: Organic Trade Association Canada, “Organic Market Trends Report 2024,” organictradeassociation.ca. Growing awareness of personal health and environmental sustainability influenced this market evolution, particularly as media coverage intensified regarding conventional farming methods. Organic dairy products consistently maintain significant price premiums in retail environments, with robust sales performance demonstrating consumer willingness to invest in organic alternatives. In response to this market transformation, major processors have expanded their organic product portfolios, with Agropur substantially increasing its organic processing capabilities in 2024 to accommodate the expanding Quebec and Ontario markets.
Lactose-Free and Functional Dairy Innovation Captures Growing Market Share
The lactose-free dairy segment has transformed significantly, evolving from basic milk alternatives to encompass a diverse portfolio of functional products enriched with probiotics, enhanced protein content, and targeted nutritional benefits. The market for lactose-free dairy products continues to demonstrate remarkable growth momentum, particularly in the yogurt and cheese categories, which have emerged as key growth drivers [3]Source: Canadian Digestive Health Foundation, “Lactose-Free Product Market Analysis,” cdhf.ca. Western provinces exhibit notably higher consumption patterns of lactose-free products per resident, a trend closely connected to their diverse demographic composition and increasing health-conscious consumer behaviors. Recent breakthroughs in enzyme technology have empowered manufacturers to successfully preserve authentic taste profiles while eliminating lactose content, effectively addressing a fundamental barrier to market adoption among traditional dairy consumers who had historically avoided these products due to taste-related concerns.
Sustainability Practices Transform Production Methods and Brand Positioning
Canadian dairy farms have demonstrated their commitment to environmental stewardship by setting ambitious net-zero greenhouse gas emissions targets, implementing advanced methane reduction technologies and transitioning to renewable energy systems to meet progressive milestones. A significant number of farms have embraced comprehensive sustainability assessment programs that emphasize water conservation strategies, soil health management, and carbon sequestration practices to minimize their environmental footprint while ensuring optimal production efficiency. Market research demonstrates that a substantial portion of dairy consumers prioritize environmental considerations in their purchasing decisions, creating favorable market conditions for sustainably-produced products. The industry's robust environmental initiatives have successfully attracted environmental investment funds and facilitated entry into premium export markets across Europe and Asia, where sustainability credentials have become increasingly critical in procurement decisions.
Restraints Impact Analysis
| Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Stringent food safety and labeling regulations increasing operational complexity | -0.8% | National, with higher compliance costs in smaller operations | Short term (≤ 2 years) |
| Growing consumer scrutiny around ethical sourcing and animal welfare | -0.6% | National, with premium positioning requirements in urban markets | Medium term (2-4 years) |
| Rising concerns about the environmental impact of dairy farming | -0.9% | National, with regulatory pressure in British Columbia | Long term (≥ 4 years) |
| Supply chain disruptions impacting production reliability | -0.7% | National, with transportation vulnerabilities in remote regions | Short term (≤ 2 years) |
| Source: Mordor Intelligence | |||
Regulatory Complexity Escalates Operational Costs Across Value Chain
The Canadian Food Inspection Agency's enhanced labeling requirements and food safety protocols have substantially increased compliance costs for dairy processors across the country. Small operations face a particularly challenging environment due to the fixed regulatory overhead burden. The new nutritional labeling mandates require extensive product testing and comprehensive documentation processes, while allergen management protocols necessitate significant facility modifications and comprehensive staff training programs. These regulatory requirements have accelerated industry consolidation as small processors struggle to manage mounting compliance expenses while maintaining competitive prices in the market. While the regulations have strengthened food safety standards across the industry, they have also established significant market entry barriers and hampered product innovation efforts, as companies must redirect substantial resources from research and development initiatives toward meeting compliance requirements.
Ethical Sourcing Scrutiny Demands Enhanced Animal Welfare Standards
Consumer advocacy groups and social media campaigns have significantly influenced public perception of dairy farming practices, with a substantial portion of consumers now expressing serious concerns about animal welfare in dairy production. In response, the proAction program has implemented comprehensive animal welfare standards that require extensive facility modifications and management practice changes, resulting in notable increases in operational costs for dairy farms. This heightened focus has created distinct market segments, with premium brands emphasizing their welfare certifications while value-oriented products work to balance compliance costs. The industry has accelerated the adoption of pasture-based systems and enhanced housing conditions, which improve animal welfare outcomes but require substantial capital investments from dairy farmers to implement these changes effectively.
Segment Analysis
By Product Type: Milk Dominance Anchored by Consumption Habits and Nutritional Positioning
Milk products dominate the market with a substantial 68.61% share in 2024, demonstrating the enduring consumer trust and institutional demand across various sectors. Traditional fluid milk consumption remains resilient in the face of alternative options, with whole milk varieties maintaining their position in households across the nation. The consistent demand from schools, healthcare facilities, and foodservice establishments further reinforces milk's market dominance, while its fundamental role in daily nutrition continues to drive consumption patterns.
The market dynamics show promising growth across various dairy segments. Yogurt leads the expansion with a projected 7.01% CAGR through 2030, as consumers embrace its probiotic benefits, practical packaging solutions, and innovative flavors that resonate with health-conscious younger demographics. The cheese segment maintains its position as the second-largest category, with natural varieties including cheddar, cottage, and artisanal options experiencing steady growth in response to premium product demand. While processed cheese encounters resistance from consumers seeking less processed alternatives, cream products benefit from the revival of foodservice operations and increased home baking activities. The dairy desserts category, encompassing ice cream and frozen novelties, demonstrates predictable seasonal consumption patterns and continues to evolve through premium offerings and healthier formulations that meet modern consumer preferences.
Note: Segment shares of all individual segments available upon report purchase
By Distribution Channel: Off-Trade Dominance Challenged by Foodservice Recovery
Off-trade channels maintain their dominant position with a 75.23% market share in 2024, primarily through supermarkets and hypermarkets. These retail giants effectively leverage their substantial purchasing power and sophisticated promotional strategies to drive dairy product sales across their extensive store networks. Convenience stores have successfully carved out their market share by adapting to consumer needs through extended operating hours and strategic product placement. This approach has proven particularly effective for single-serve items that align with the fast-paced lifestyle of urban consumers. The online retail segment has witnessed remarkable growth following the widespread adoption of e-commerce platforms, with subscription-based services and direct-to-consumer business models gaining significant traction among premium dairy brands looking to build stronger customer relationships and secure better profit margins.
The on-trade segment demonstrates impressive growth momentum with a 6.74% CAGR, largely attributed to the robust recovery in the foodservice industry and strategic premium product positioning across restaurants, cafes, and institutional establishments. Foodservice operators have recognized the value of differentiation and are increasingly partnering with local dairy suppliers to source artisanal products. This strategic shift allows them to create unique menu offerings that justify premium pricing structures, subsequently opening new opportunities for specialty dairy producers to penetrate higher-value market segments. The emphasis on local sourcing not only supports product differentiation but also responds to growing consumer demand for authenticity and transparency in food sourcing.
Note: Segment shares of all individual segments available upon report purchase
Geography Analysis
The Canadian dairy market shows clear differences across regions, influenced by how much each area can produce, who the consumers are, and what rules govern the industry in different provinces. Quebec and Ontario together make up the largest share of Canada's dairy production, thanks to their well-developed facilities, good weather conditions, and closeness to major cities - factors that help keep transport costs down and ensure fresh products reach consumers quickly. Quebec stands out for its strong cultural connection to cheese and yogurt, with people consuming more of these products than the national average, while Ontario's diverse city markets push for new developments in high-end and specialized dairy products.
The western provinces are seeing faster growth in dairy consumption, with British Columbia taking the lead in organic and sustainable dairy products, reflecting both environmental awareness and higher spending power in cities like Vancouver and Victoria. Alberta has grown its dairy processing abilities since 2024, responding to more people moving to the province and increased spending on premium dairy products. In the Prairie provinces, there's growing demand for specialized dairy products, particularly lactose-free and protein-rich options, as more health-conscious consumers and active individuals seek these alternatives.
The Atlantic region faces its own unique market conditions, with smaller dairy operations focusing on local and regional sales while dealing with the challenge of high transport costs to reach other Canadian markets. These provinces have successfully adopted direct sales to consumers and farm tourism activities, which help position local dairy products as premium offerings and build strong customer relationships that support higher prices. The Canadian Food Inspection Agency ensures consistent standards across all provinces, while the supply management system helps maintain stable prices and allows producers to plan their production effectively, supporting long-term investments and market growth strategies.
Competitive Landscape
The Canadian dairy market features a concentrated landscape where established companies have built their success on efficient operations, strong distribution networks, and trusted brand names. Saputo Inc. maintains its position as the market leader by controlling its supply chain and making strategic acquisitions, including a recent move into plant-based alternatives to meet evolving consumer needs. Agropur Dairy Co-operative has strengthened its market position by focusing on sustainability and investing CAD 200 million in 2024 to upgrade its facilities, improving both efficiency and product quality.
The market has become more dynamic as global players like Groupe Lactalis and Danone increase their Canadian footprint through acquisitions and partnerships, bringing their international experience in product development and marketing. Larger companies continue to acquire regional processors, expanding their reach and product range while finding cost savings through combined operations.
Companies are gaining competitive advantages by embracing technology, with investments in automation, data analytics, and supply chain improvements to reduce costs while delivering better products more reliably. The market offers growth potential in premium categories, including organic, functional, and artisanal products, where smaller specialized producers can succeed by offering unique products and selling directly to consumers.
Canada Dairy Industry Leaders
-
Saputo Inc.
-
Agropur Dairy Co-operative
-
Groupe Lactalis
-
Danone S.A.
-
Gay Lea Foods
- *Disclaimer: Major Players sorted in no particular order
Recent Industry Developments
- October 2025: Danone Canada has invested $9 million in its Boucherville plant for the production of recyclable PET yogurt cups, integrating 30% recycled content and advancing sustainability. The initiative is backed by Quebec’s government and targets reduced plastic pollution.
- April 2025: Lactalis Canada partnered with Nestlé Canada to enter the frozen yogurt category, launching iÖGO and iÖGO nanö products made with real fruit and 100% Canadian milk. The range offers SKUs in bars, tubs, and pops, distributed nationally.
- February 2025: Oikos, a Danone Canada brand, launched the Oikos PRO line of high-protein, no added sugar Greek yogurts and drinkable yogurts. The range is locally made using 100% Canadian dairy milk and targets fitness-focused consumers seeking nutritional value.
Canada Dairy Market Report Scope
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.| Butter | Salted Butter | |
| Unsalted Butter | ||
| Cheese | Natural Cheese | Cheddar |
| Cottage | ||
| Ricotta | ||
| Parmesan | ||
| Others | ||
| Processed Cheese | ||
| Cream | Fresh Cream | |
| Cooking Cream | ||
| Whippng Cream | ||
| Others (Clottted, Sour Cream) | ||
| Dairy Desserts | Ice Cream | |
| Cheesecakes | ||
| Frozen Desserts | ||
| Others (Puddings/desserts, trifles, fools) | ||
| Milk | Condensed milk | |
| Flavored Milk | ||
| Fresh Milk | ||
| UHT Milk (Ultra-high temperature milk) | ||
| Powdered Milk | ||
| Yogurt | Drinkable | |
| Spoonable | ||
| Sour Milk Drinks | ||
| On-trade | |
| Off-trade | Convenience Stores |
| Specialist Retailers | |
| Supermarkets and Hypermarkets | |
| Online Retail | |
| Others |
| By Product Type | Butter | Salted Butter | |
| Unsalted Butter | |||
| Cheese | Natural Cheese | Cheddar | |
| Cottage | |||
| Ricotta | |||
| Parmesan | |||
| Others | |||
| Processed Cheese | |||
| Cream | Fresh Cream | ||
| Cooking Cream | |||
| Whippng Cream | |||
| Others (Clottted, Sour Cream) | |||
| Dairy Desserts | Ice Cream | ||
| Cheesecakes | |||
| Frozen Desserts | |||
| Others (Puddings/desserts, trifles, fools) | |||
| Milk | Condensed milk | ||
| Flavored Milk | |||
| Fresh Milk | |||
| UHT Milk (Ultra-high temperature milk) | |||
| Powdered Milk | |||
| Yogurt | Drinkable | ||
| Spoonable | |||
| Sour Milk Drinks | |||
| By Distribution Channel | On-trade | ||
| Off-trade | Convenience Stores | ||
| Specialist Retailers | |||
| Supermarkets and Hypermarkets | |||
| Online Retail | |||
| Others | |||
Market Definition
- Butter - Butter is a yellow-to-white solid emulsion of fat globules, water, and inorganic salts produced by churning the cream from cows’ milk
- Dairy - Dairy product include milk and any of the foods made from milk, including butter, cheese, ice cream, yogurt, and condensed and dried milk.
- Frozen Desserts - Frozen dairy dessert means and includes products containing milk or cream and other ingredients which are frozen or semi-frozen prior to consumption, such as ice milk or sherbet, including frozen dairy desserts for special dietary purposes, and sorbet
- Sour Milk Drinks - Sour milk is thick, curdled milk, with a sour taste, obtained from the fermentation of milk. Sour milk drinks such as kefir, laban, buttermilk have been considered in the study
| Keyword | Definition |
|---|---|
| Cultured Butter | Cultured butter is prepared by having the raw butter go through chemical processing and has been added with certain emulsifiers and foreign ingredients. |
| Uncultured Butter | This type of butter is one which has not been processed in any way |
| Natural Cheese | The type of cheese in its most natural form. It is made from natural and simple products and ingredients, including fresh and natural salts, natural colors, enzymes, and high-quality milk. |
| Processed Cheese | Processed cheese undergoes the same processes as natural cheese; however, it requires more steps and many different forms of ingredients. Making processed cheese involves melting natural cheese, emulsifying it, and adding preservatives and other artificial ingredients or colorings. |
| Single Cream | Single cream contains around 18% fat. It’s a single layer of cream that appears over boiled milk. |
| Double Cream | Double cream contains 48% fat, more than double the amount of fat of single cream. It’s heavier and thicker than single cream |
| Whipping Cream | This has a much higher fat percentage than single cream (36%). Used to top cakes, pies, and puddings and as a thickener for sauces, soups, and fillings. |
| Frozen Desserts | Desserts that are meant to be eaten in frozen condition. E.g., sherbets, sorbets, frozen yogurts |
| UHT Milk (Ultra-high temperature milk) | Milk heated at a very high temperature. Ultra-high-temperature processing (UHT) of milk involves heating for 1–8 sec at 135–154°C. which kills the spore-forming pathogenic microorganism, resulting in a product with a shelf-life of several months. |
| Non-dairy butter/Plant-based butter | Butter made from plant-derived oil such as coconut, palm, etc. |
| Non-dairy Yogurt | Yogurt made from typically made from nuts, like almonds, cashews, coconuts, and even other foods like soybeans, plantains, oats, and peas |
| On-trade | It refers to restaurants, QSRs, and bars. |
| Off-trade | It refers to supermarkets, hypermarkets, on-line channels, etc. |
| Neufchatel cheese | One of the oldest kinds of cheese in France. It is a soft, slightly crumbly, mold-ripened, bloomy-rind cheese made in the Neufchâtel-en-Bray region of Normandy. |
| Flexitarian | It refers to a consumer preferring a semi-vegetarian diet, that is centered on plant foods with limited or occasional inclusion of meat. |
| Lactose Intolerance | Lactose intolerance is a reaction in digestive system to lactose, the sugar in milk. It causes uncomfortable symptoms in response to the consumption of dairy products. |
| Cream Cheese | Cream cheese is a soft and creamy fresh cheese with a tangy taste made from milk and cream. |
| Sorbets | Sorbet is a frozen dessert made using ice combined with fruit juice, fruit purée, or other ingredients, such as wine, liqueur, or honey. |
| Sherbet | Sherbet is a sweetened frozen dessert made with fruit and some sort of dairy product such as milk or cream. |
| Shelf stable | Foods that can be safely stored at room temperature, or "on the shelf," for at least one year and do not have to be cooked or refrigerated to eat safely. |
| DSD | Direct Store Delivery is the process in supply chain management wherein the product is delivered from manufacturing plant directly to the retailer. |
| OU Kosher | Orthodox Union Kosher is a kosher certification agency based in New York City. |
| Gelato | Gelato is a frozen creamy dessert made with milk, heavy cream and sugar. |
| Grass-fed Cows | Grass-fed cows are allowed to graze in pastures, where they eat a variety of grasses and clover. |
Research Methodology
Mordor Intelligence follows a four-step methodology in all our reports.
- Step-1: Identify Key Variables: In order to build a robust forecasting methodology, the variables and factors identified in Step 1 are tested against available historical market numbers. Through an iterative process, the variables required for market forecast are set, and the model is built on the basis of these variables.
- Step-2: Build a Market Model: Market-size estimations for the forecast years are in nominal terms. Inflation is not a part of the pricing, and the average selling price (ASP) is kept constant throughout the forecast period for each country.
- Step-3: Validate and Finalize: In this important step, all market numbers, variables, and analyst calls are validated through an extensive network of primary research experts from the market studied. The respondents are selected across levels and functions to generate a holistic picture of the market studied.
- Step-4: Research Outputs: Syndicated Reports, Custom Consulting Assignments, Databases & Subscription Platforms
