Global dairy ingredients market to reach US$133.4B by 2032

GLOBAL – The dairy ingredients market is set for significant expansion, with projections indicating it will grow from US$88.93 billion in 2024 to US$133.4 billion by 2032, at a compound annual growth rate of 5.2%. 

A report by SkyQuest Technology Consulting Pvt. Ltd. attributes this growth to rising demand for protein-rich diets, increasing preference for functional foods, and growing awareness of clean-label products. 

The report highlights that dairy ingredients remain essential in various industries, including food and beverages, sports nutrition, infant formula, and bakery, due to their nutritional value and versatility.

According to the report, dairy ingredients are derived from milk and play a key role in enhancing flavor, texture, and shelf life in food products. 

These ingredients include milk powder, whey protein, casein, lactose, butterfat, and cheese powders, all of which are widely used across multiple industries. 

The food and beverage sector remains the largest consumer, driven by the demand for dairy-based products such as yogurt, cheese, ice cream, and ready-to-eat meals. 

Additionally, sports nutrition continues to be a major market segment, fueled by increasing fitness trends and the popularity of protein-rich dietary supplements.

A spokesperson from SkyQuest Technology Consulting commented, “The shift towards clean-label and natural ingredients is reshaping the industry, as consumers increasingly seek minimally processed products with recognizable ingredients.” 

The report also indicates that the expansion of the infant formula market, particularly in urban areas, is a significant driver of demand. 

Rising disposable incomes and increased awareness of infant nutrition are further accelerating this trend.

Regional insights suggest that the Asia-Pacific region leads the market, driven by high dairy consumption in China, India, and Southeast Asia. 

Europe follows closely, supported by its well-established dairy industry and strong consumer demand for functional foods. 

North America is experiencing growth due to its thriving sports nutrition market and rising interest in organic and clean-label products. 

Meanwhile, Latin America and the Middle East & Africa are emerging markets where demand for dairy-based infant nutrition and processed foods is on the rise.

Despite the strong growth projections, the market faces challenges, including fluctuations in raw material prices, increasing awareness of lactose intolerance, and competition from plant-based alternatives. 

Stringent regulatory standards also impact manufacturers by raising compliance costs and potentially delaying product launches.

Industry leaders such as Fonterra Co-Operative Group, FrieslandCampina, Arla Food Ingredients, and Glanbia PLC continue to dominate the market, with ongoing investments in product innovation and technology. 

The integration of plant-based ingredients with traditional dairy components is one of the emerging trends, addressing evolving consumer preferences. 

A market analyst noted, “Technological advancements in dairy ingredient processing will play a crucial role in enhancing quality and broadening application possibilities.”

As the global emphasis on health and nutrition intensifies, the demand for functional and fortified foods continues to grow.