Global Dairy Ingredient Market Size, Share, and COVID-19 Impact Analysis, By Product (Skimmed Milk Powder (SMP), Whole Milk Powder (WMP), Buttermilk Powder, Cream Powder, Blenders & Replacers, Rolled Dried Powder, Fat-filled Powder, Permeate Powder, Lactose & Derivatives, Casein & Caseinate, Milk Protein Concentrate and Milk Protein Isolate (MPC & MPI), and Whey Ingredients), By Application (Bakery & Confectionery, Dairy Products, Convenience Foods, Infant Milk Formula, and Others), and By Region (North America, Europe, Asia-Pacific, Latin America, Middle East, and Africa), Analysis and Forecast 2025 - 2035

Global Dairy Ingredient Market Insights Forecasts to 2035

• The Global Dairy Ingredient Market Size Was Estimated at USD 88.76 Billion in 2024
• The Market Size is Expected to Grow at a CAGR of around 5.13% from 2025 to 2035
• The Worldwide Dairy Ingredient Market Size is Expected to Reach USD 153.93 Billion by 2035
• Europe is Expected to Grow the fastest during the forecast period.

The Global Dairy Ingredient Market Size was worth around USD 88.76 Billion in 2024 and is predicted to Grow to around USD 153.93 Billion by 2035 with a compound annual growth rate (CAGR) of 5.13% from 2025 to 2035. The dairy components are set for strong, sustainable growth driven by their nutritional value, versatility, and rising global demand. Innovation, health trends, and expanding markets continue to reinforce their vital role in the evolving food industry.

Market Overview

The dairy ingredient market is the worldwide industry that produces, processes, distributes, and sells ingredients made from milk. These ingredients' functional, nutritional, and sensory qualities make them useful in a variety of food and beverage industries.

There is a growing need for nutrient-dense, high-protein, and functional foods. This growth is still being driven by rising milk supply, shifting dietary tastes, and the need for ready-to-eat foods. Dairy components are vital in many food applications because they provide important functional benefits like thickening and emulsification. However, there are significant obstacles due to the growing popularity of plant-based substitutes as well as worries about sustainability and animal welfare. The worldwide dairy supply chain was also affected by the COVID-19 pandemic, which had an effect on pricing and production. Notwithstanding these obstacles, new opportunities are being created by innovation and changing customer demands. As the market adjusts to changing ethical, environmental, and health objectives, it is anticipated to develop steadily.

Report Coverage

This research report categorizes the dairy ingredient market based on various segments and regions, forecasts revenue growth, and analyzes trends in each submarket. The report analyses the key growth drivers, opportunities, and challenges influencing the dairy ingredient market. Recent market developments and competitive strategies such as expansion, type launch, development, partnership, merger, and acquisition have been included to draw the competitive landscape in the market. The report strategically identifies and profiles the key market players and analyses their core competencies in each sub-segment of the dairy ingredient market.

Driving Factors

The dairy components are in high demand worldwide due to their many uses in the food, beverage, and supplement industries, as well as their nutritional advantages and functional adaptability. Dairy components are being positioned as a crucial remedy as health-conscious customers look for natural goods that are high in protein. Western eating practices are being adopted by emerging economies, which is driving market expansion. Dairy ingredients are becoming more appealing and useful due to product innovation and technological improvements. Their importance is further increased by their support of dairy farming and promotion of food security. The market for dairy components is expected to grow strongly and sustainably as a result of these factors taken together.

Restraining Factors

The market growth is hindered by the plant-based substitutes, which directly compete with conventional dairy products, and are in greater demand as a result of growing consumer awareness of animal welfare, lactose intolerance, and environmental sustainability. Strict regulatory requirements, supply chain interruptions, and raw milk price fluctuation can also make production and distribution more difficult.

Market Segmentation

The dairy ingredient market share is classified intoproduct and application.

• The milk protein concentrate and milk protein isolate (MPC & MPI) segment held the largest share in 2024 and is anticipated to grow at a significant CAGR during the forecast period.

Based on the product, the dairy ingredient market is classified into skimmed milk powder (SMP), whole milk powder (WMP), buttermilk powder, cream powder, blenders & replacers, rolled dried powder, fat-filled powder, permeate powder, lactose & derivatives, casein & caseinate, milk protein concentrate and milk protein isolate (MPC & MPI), and whey ingredients. Among these, the milk protein concentrate and milk protein isolate (MPC & MPI) segment held the largest share in 2024 and is anticipated to grow at a significant CAGR during the forecast period. The segmental growth can be attributed to their high protein content and clean-label appeal. MPC (Milk Protein Concentrate) and MPI (Milk Protein Isolate) are becoming more popular. Their application in infant formula, sports nutrition, and supplements fuels the rising demand for goods with a health focus. For health and wellness objectives, consumers are favoring natural, high-protein products more and more. Consequently, MPC and MPI are important forces behind the changing market for high-protein foods.

• The dairy products segment accounted for the largest share in 2024 and is estimated to grow at a remarkable CAGR during the forecast period.

Based on the application, the dairy ingredient market is categorized into bakery & confectionery, dairy products, convenience foods, infant milk formula, and others. Among these, the dairy products segment accounted for the largest share in 2024 and is estimated to grow at a remarkable CAGR during the forecast period. The segmental growth can be attributed to the increasing popularity of dairy products in the food and beverage industries due to the rising desire for natural, wholesome ingredients. They are perfect for convenience and ready-to-eat items because of their usefulness and health advantages. Growth in emerging markets like China and India is being further accelerated by rising affluence and the influence of Western diets. All of these developments work together to propel the global dairy ingredient market's steady growth.

Regional Segment Analysis of the Dairy Ingredient Market

• North America (U.S., Canada, Mexico) 
• Europe (Germany, France, U.K., Italy, Spain, Rest of Europe)
• Asia-Pacific (China, Japan, India, Rest of APAC)
• South America (Brazil and the Rest of South America) 
• The Middle East and Africa (UAE, South Africa, Rest of MEA)

North America is anticipated to hold the largest share of the dairy ingredient market over the predicted timeframe.

North America is anticipated to hold the largest share of the dairy ingredient market over the predicted timeframe. The regional growth can be attributed to the growing demand for dairy-based goods among customers looking for natural and wholesome food options. A variety of food and beverage products, such as baked goods, confections, and prepared meals, depend on dairy ingredients, including cheese, butter, and milk powders. Additionally, the market demand for dairy ingredients is driven by consumers' increasing preference for diets high in protein. The usefulness and adaptability of these ingredients have also been improved by technical developments in dairy processing, enabling producers to develop novel products that satisfy changing consumer preferences and tastes. The demand for dairy ingredients in the North American market is also influenced by the growing popularity of convenience foods and drinks.

Europe is expected to grow at a rapid CAGR in the dairy ingredient market during the forecast period. The region's growth is being driven by the consumers' growing preference for natural and healthful food options. To meet shifting consumer preferences and dietary trends like higher protein intake, the European dairy industry also continuously innovates and diversifies its product offers. Furthermore, the demand for dairy components like butter, cream, and milk powders, all crucial for boosting product flavour, has increased due to the growth of the bakery and confectionery industries throughout Europe. Additionally, European consumers choose locally produced dairy components, supporting local dairy farms and producers as a result of a growing emphasis on sustainable food production and sourcing.

Competitive Analysis:

The report offers the appropriate analysis of the key organizations/companies involved within the dairy ingredient market, along with a comparative evaluation primarily based on their type of offering, business overviews, geographic presence, enterprise strategies, segment market share, and SWOT analysis. The report also provides an elaborative analysis focusing on the current news and developments of the companies, which includes type development, innovations, joint ventures, partnerships, mergers & acquisitions, strategic alliances, and others. This allows for the evaluation of the overall competition within the market.

List of Key Companies

• Fonterra Co-Operative Group Limited
• EPI Ingredients
• FrieslandCampina
• Lactalis American Group, Inc.
• Arla Food Ingredients
• Schreiber Foods Inc.
• Glanbia PLC
• Dairy Farmers of America Inc.
• Sodiaal Group
• Saputo, Inc.
• Amco Proteins
• Volac International   
• Ingredia
• Others.

Key Target Audience

• Market Players
• Investors
• End-users
• Government Authorities 
• Consulting And Research Firm
• Venture capitalists
• Value-Added Resellers (VARs)

Key Recent Development

• In May 2024, Epi Ingredients announced the release of a new additive-free butter powder to suit rising customer demand for clean-label and natural ingredients. This product innovation meets the industry's demand for adaptable and convenient butter replacements in a variety of food applications.

Market Segment

This study forecasts revenue at global, regional, and country levels from 2020 to 2035. Spherical Insights has segmented the dairy ingredient market based on the below-mentioned segments: 

Global Dairy Ingredient Market, By Product

• Skimmed Milk Powder (SMP)
• Whole Milk Powder (WMP)
• Buttermilk Powder
• Cream Powder
• Blenders & Replacers
• Rolled Dried Powder
• Fat-filled Powder
• Permeate Powder
• Lactose & Derivatives
• Casein & Caseinate
• Milk Protein Concentrate and Milk Protein Isolate (MPC & MPI)
• Whey Ingredients

Global Dairy Ingredient Market, By Application

• Bakery & Confectionery
• Dairy Products
• Convenience Foods
• Infant Milk Formula
• Others

Global Dairy Ingredient Market, By Regional Analysis

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Russia
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Rest of Asia Pacific
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Middle East & Africa
  • UAE
  • Saudi Arabia
  • Qatar
  • South Africa
  • Rest of the Middle East & Africa