Dairy Ingredients Market - Growth, Trends, and Forecast (2023 - 2028)

The Dairy Ingredients Market is Segmented by Type (Milk Powders, Milk Protein Concentrates and Milk Protein Isolates, Whey Ingredients, Lactose and Derivatives, Casein and Caseinates, and Other Types), Application (Bakery and Confectionery, Dairy Products, Infant Milk Formula, Sports and Clinical Nutrition, and Other Applications), and Geography (North America, Europe, Asia-Pacific, South America, and Middle-East and Africa). The report offers the market size and forecast in value (in USD million) for all the above segments.

Dairy Ingredients Market Size

Dairy Ingredients Market Summary
Study Period: 2018 - 2028
Fastest Growing Market: Asia-Pacific
Largest Market: Europe
CAGR: 4.03 %

Major Players

Dairy Ingredients Market Major Players

*Disclaimer: Major Players sorted in no particular order


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Dairy Ingredients Market Analysis

The Dairy Ingredients Market was valued at USD 57,809.7 million in the current year and is projected to register a CAGR of 4.03% over the forecast period.

The rise in health and awareness of nutritional content has pushed the market for functional and fortified foods, creating demand for dairy ingredients. Manufacturers have been using dairy ingredients since they have versatile functional and nutritional properties, providing richness, texture, flavor, and color to food products. 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 COVID-19 pandemic significantly altered the global dairy ingredients market as health-conscious consumers’ demand for protein-rich products surged along with other nutritional supplements. In particular, the pandemic spiked the demand for high-protein whey products like WPC-80 and WPI as they contain anti-viral properties that help to stimulate the immune response.

There is an increased awareness about dairy protein as consumers maintain a healthy lifestyle, as dairy proteins are rich in protein and have a superior content of amino acids. Various ingredients, like whey protein, milk protein, or casein, act as anti-aging components. 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 Industry Segmentation

Dairy ingredients consist of components extracted from milk, further used to prepare different dairy products. 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. The report offers the market size and forecast in value (in USD million) for all the above segments.

Milk Powders
Skimmed Milk Powders
Whole Milk Powders
Milk Protein Concentrates and Milk Protein Isolates
Whey Ingredients
Whey Protein Concentrate (WPC)
Whey Protein Isolate (WPI)
Hydrolyzed Whey Protein (HWP)
Lactose and Derivatives
Casein and Caseinates
Other Types
Bakery and Confectionery
Dairy Products
Infant Milk Formula
Sports and Clinical Nutrition
Other Applications
North America
United States
Rest of North America
United Kingdom
Rest of Europe
Rest of Asia-Pacific
South America
Rest of South America
Middle-East and Africa
United Arab Emirates
South Africa
Rest of Middle-East and Africa

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Dairy Ingredients Market Trends

This section covers the major market trends shaping the Dairy Ingredients Market according to our research experts:

Increasing Milk Production Supporting the Demand for Dairy Ingredients

Growing consumer demand for more nutrition from their food and beverage products and interest in health and wellness has increased the use of milk protein in the market. Due to their digestibility property, milk protein isolates are the most used ingredient by infant food manufacturers, such as as-baby cereals, bottled baby food, and others. India is the world's largest milk producer, with an output of more than 209.6 million tons of cows' milk in 2021, according to FAOSTAT. Other large milk producers were the United States, with almost 102.62 million metric tons, and Pakistan, with around 60.8 million tons. In 2021, manufacturers such as Lactalis launched organic whole milk powder ingredients that have broad applications across different end-user industries, such as confectionery and bakery industries, to cater to the burgeoning demand from various end-user industries that are looking to formulate organic food products.

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. Moreover, the government initiatives to support the dairy business are a significant factor in the increased production. For instance, National Programme for Dairy Development (NPDD) in India aims to strengthen infrastructure for producing high-quality milk and its products. Furthermore, the positive outlook of the dairy industry in the market, followed by increasing consumer demand for protein-rich food with constant evolution in product launches, is actively accelerating the application of various dairy ingredients in the food and beverage industry and is expected to continue gaining momentum during the forecast period.

Production of Skimmed Milk Powders, in Tons, by Country, Global, 2021

Europe Holds the Major Share

Europe is the largest segment in the dairy ingredients market, followed by North America and Asia-Pacific. High-concentrate ingredients such as whey proteins and milk protein isolates are used in the United Kingdom, Germany, and France. The rising health and wellness concerns among consumers, facilitated by the increasing participation in sports, led to the enhanced usage of dairy ingredients in the supplements industry. Moreover, the key players focus on introducing new products to meet the consumers' requirements. For instance, in December 2021, Euroserum launched SICAPRO 35, which provides an optimized protein profile with all essential amino acids and a high level of tryptophan.

The demand for protein as an ingredient is appealing the fitness enthusiasts. The region also sees rising demand for mainstream health and wellness ingredients in the food and beverage sector. Countries like Germany and France show a massive demand for infant nutrition or baby formula, which caters to the rising demand for dairy proteins. The region's strong coffee culture has increased the demand for dairy ingredients, considering their massive use in the food and beverage industry in preparing creamers or whiteners. The increasing trend of organic food consumption resulted in new product developments by companies. For instance, in 2021, Lactalis Ingredients launched organic whole milk powder to expand its product portfolio in France. The company guaranteed the products were free from additives like preservatives and neutralizing agents.

Dairy Ingredients Market: Market Size (%), by Region, Global, 2021

Dairy Ingredients Industry Overview

The dairy ingredients market is highly fragmented due to the presence of numerous players. Arla Food amba, Fonterra Co-Operative Group Limited, Saputo Inc., Dairy Farmers of America, Groupe Lactalis, and Royal Friesland Campina are some of the major players operating in the dairy ingredients market. The major players operating in the dairy ingredients industry are strengthening their presence with product innovations, partnerships, and expansions. For instance, in February 2022, Saputo Inc. announced several significant capital investments and consolidation initiatives to improve and streamline its manufacturing footprint in its USA Sector and International sectors. These initiatives are part of the 'Optimize and Enhance Operations' pillar of the company's global strategic plan.

Dairy Ingredients Market Leaders

  1. Arla Foods amba

  2. Dairy Farmers of America

  3. Fonterra Co-Operative Group Limited

  4. Saputo Inc.

  5. Groupe Lactalis

*Disclaimer: Major Players sorted in no particular order

Dairy Ingredients Market Concentration

Dairy Ingredients Market News

  • In July 2022, NZMP Fonterra's global ingredients business entered a joint venture with Tillamook Country Creamery Association (TCCA) and Three Mile Canyon farms in the United States to launch Pro–OptimaTM, a grade A functional whey protein concentrate, to the market.
  • In May 2022, Arla Foods launched a new production plant for dairy products in Germany. Through this expansion, the company will be able to invest a huge amount in producing dairy ingredients and produce around 90,000 tons of high-quality milk powder.
  • In May 2022, Fonterra launched a new online dairy platform that makes it easier for customers. The platform offers a wide range of products, from milk powder to specialty dairy proteins.

Dairy Ingredients Market Report - Table of Contents


    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study




    1. 4.1 Market Drivers

    2. 4.2 Market Restraints

    3. 4.3 Porter's Five Forces Analysis

      1. 4.3.1 Threat of New Entrants

      2. 4.3.2 Bargaining Power of Buyers/Consumers

      3. 4.3.3 Bargaining Power of Suppliers

      4. 4.3.4 Threat of Substitute Products

      5. 4.3.5 Intensity of Competitive Rivalry


    1. 5.1 Type

      1. 5.1.1 Milk Powders

        1. Skimmed Milk Powders

        2. Whole Milk Powders

      2. 5.1.2 Milk Protein Concentrates and Milk Protein Isolates

      3. 5.1.3 Whey Ingredients

        1. Whey Protein Concentrate (WPC)

        2. Whey Protein Isolate (WPI)

        3. Hydrolyzed Whey Protein (HWP)

      4. 5.1.4 Lactose and Derivatives

      5. 5.1.5 Casein and Caseinates

      6. 5.1.6 Other Types

    2. 5.2 Application

      1. 5.2.1 Bakery and Confectionery

      2. 5.2.2 Dairy Products

      3. 5.2.3 Infant Milk Formula

      4. 5.2.4 Sports and Clinical Nutrition

      5. 5.2.5 Other Applications

    3. 5.3 Geography

      1. 5.3.1 North America

        1. United States

        2. Canada

        3. Mexico

        4. Rest of North America

      2. 5.3.2 Europe

        1. United Kingdom

        2. Germany

        3. France

        4. Russia

        5. Italy

        6. Spain

        7. Rest of Europe

      3. 5.3.3 Asia-Pacific

        1. India

        2. China

        3. Japan

        4. Australia

        5. Rest of Asia-Pacific

      4. 5.3.4 South America

        1. Brazil

        2. Argentina

        3. Rest of South America

      5. 5.3.5 Middle-East and Africa

        1. United Arab Emirates

        2. South Africa

        3. Rest of Middle-East and Africa


    1. 6.1 Most Adopted Strategies

    2. 6.2 Market Share Analysis

    3. 6.3 Company Profiles

      1. 6.3.1 Arla Foods amba

      2. 6.3.2 Dairy Farmers of America

      3. 6.3.3 Sodiaal co-operative group

      4. 6.3.4 Fonterra Co-Operative Group Limited

      5. 6.3.5 Royal Friesland Campina

      6. 6.3.6 Kerry Group PLC

      7. 6.3.7 Kanegrade Ltd

      8. 6.3.8 Groupe Lactalis

      9. 6.3.9 Volac International Ltd

      10. 6.3.10 Hoogwegt International BV

      11. 6.3.11 Saputo Inc.

    4. *List Not Exhaustive

**Subject to Availability
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Dairy Ingredients Market Research FAQs

The Dairy Ingredients Market is studied from 2016 - 2027.

The Dairy Ingredients Market is growing at a CAGR of 4.03% over the next 5 years.

Asia-Pacific is growing at the highest CAGR over 2016-2027.

Europe holds highest share in 2021.

Arla Foods amba, Dairy Farmers of America, Fonterra Co-Operative Group Limited, Saputo Inc., Groupe Lactalis are the major companies operating in Dairy Ingredients Market.

Dairy Ingredients Industry Report

Statistics for the 2023 Dairy Ingredients market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Dairy Ingredients analysis includes a market forecast outlook to 2028 and historical overview. Get a sample of this industry analysis as a free report PDF download.

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