Dairy Market Outlook

According to the report by Expert Market Research (EMR), the global dairy market attained a value of approximately USD 561.66 billion in 2024. Aided by the rising consumption of milk and dairy-based products across the globe, growing urbanisation, and the increasing demand for high-quality nutrition, the market is projected to grow at a CAGR of 3.60% between 2025 and 2034, reaching a value of around USD 799.97 billion by 2034.

Dairy products, including milk, cheese, butter, yoghurt, cream, and other derivatives, constitute a major component of the global food and beverage industry. They are rich sources of calcium, protein, and essential micronutrients, contributing significantly to human nutrition and health. In addition to their direct consumption, dairy ingredients play a vital role in processed food manufacturing, bakery and confectionery products, infant formulas, and beverages, highlighting their wide-ranging applications across industries.

Dairy Market Size and Share

The global dairy market represents one of the largest and most dynamic segments of the food industry, encompassing both traditional dairy products and innovative value-added formulations. In 2024, liquid milk accounted for the largest share of the dairy market, followed by cheese, butter, and yoghurt. The segment’s dominance is supported by the consistent demand from both developed and developing regions, driven by cultural preferences, population growth, and nutritional awareness.

Regionally, Asia Pacific holds the largest market share, led by major dairy-producing nations such as India, China, and New Zealand. India remains the world’s largest producer and consumer of milk, supported by an extensive dairy farming network and strong government initiatives. Meanwhile, Europe and North America are mature markets characterised by high per-capita dairy consumption and strong innovation in premium and functional dairy products. Emerging markets in Africa and Latin America are also witnessing growing dairy consumption due to rapid urbanisation, increasing incomes, and changing dietary habits.

Dairy Market Trends

Several key trends are reshaping the global dairy market landscape:

• Rising Demand for Functional and Fortified Dairy Products: Consumers are increasingly seeking dairy products enriched with probiotics, vitamins, and minerals to support digestive health, immunity, and overall well-being. Functional yoghurt, fortified milk, and high-protein dairy snacks are gaining immense popularity, especially among health-conscious consumers.

• Shift Towards Organic and Sustainable Dairy Production: The demand for organic dairy products is rising, driven by consumer concerns regarding synthetic additives, hormones, and antibiotics in conventional dairy farming. Sustainable practices such as pasture-fed cattle, eco-friendly packaging, and carbon-neutral production are becoming important differentiators for dairy brands.

• Technological Integration in Dairy Processing: Advancements in processing technologies, such as membrane filtration, ultra-heat treatment (UHT), and automation, are enhancing product shelf-life, safety, and efficiency. Digitalisation and data analytics are also improving supply chain management, quality assurance, and animal health monitoring.

• Growing Popularity of Flavoured and Specialty Dairy Products: Flavoured milk, artisan cheese, and gourmet butter are witnessing increased consumer interest, particularly among younger demographics. These premium and indulgent offerings cater to evolving taste preferences and contribute to market diversification.

• Rise of Plant-Based and Hybrid Dairy Alternatives: While traditional dairy products continue to dominate, plant-based alternatives made from soy, almond, oat, and coconut are growing rapidly. The emergence of hybrid dairy products that combine dairy and plant ingredients also reflects a new direction in the market, appealing to flexitarian consumers.

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Drivers of Growth

The growth of the global dairy market is supported by multiple interrelated factors:

• Increasing Global Population and Nutritional Needs: The rising global population and growing awareness of nutrition are directly driving demand for milk and dairy-based products. Dairy is recognised as an essential source of calcium, protein, and vitamins, particularly for children and the elderly.

• Urbanisation and Changing Lifestyles: Rapid urbanisation and evolving dietary patterns have led to a surge in the consumption of ready-to-eat and convenience foods, many of which incorporate dairy ingredients.

• Expanding Foodservice and Hospitality Industry: The growing number of quick-service restaurants (QSRs), cafes, and bakeries is driving demand for dairy ingredients such as cheese, butter, and cream. The expansion of international food chains has further boosted consumption.

• Technological Advancements in Dairy Farming: Innovations in animal health, genetic improvement, and feed optimisation have enhanced milk yield and quality, thereby supporting sustainable production growth.

• Rising Disposable Incomes and Premiumisation: Consumers in developing regions are increasingly opting for premium dairy products such as organic milk, flavoured yoghurt, and artisanal cheese, which offer better taste and health benefits.

Dairy Market Segmentation

The market can be divided based on product and region.

Competitive Landscape

Some of the major players explored in the report by Expert Market Research are as follows:

• Danone S.A.
• Royal FrieslandCampina N.V.
• Arla Foods amba
• Nestlé S.A.
• Fonterra Co-operative Group Limited
• Dairy Farmers of America, Inc.
• Lactalis Group
• Saputo Inc.
• China Mengniu Dairy Company Limited
• Meiji Holdings Company, Ltd
• Others

Challenges and Opportunities

Despite steady growth, the dairy market faces several challenges:

• Price Volatility: Fluctuations in feed costs, milk prices, and supply-demand imbalances often affect profitability and sustainability across the dairy value chain.

• Environmental Concerns: Greenhouse gas emissions, water consumption, and waste generation in dairy farming are prompting calls for more sustainable production practices.

• Competition from Plant-Based Alternatives: The rapid growth of plant-based dairy substitutes presents a competitive challenge, particularly among consumers seeking lactose-free or vegan options.

• Supply Chain Disruptions: Global trade fluctuations, geopolitical tensions, and logistical issues can disrupt dairy exports and imports, affecting market stability.

However, these challenges also present significant opportunities for innovation and expansion:

• Development of Sustainable Dairy Solutions: Investments in carbon-neutral farming, renewable energy, and waste management can help companies enhance sustainability and brand reputation.

• Emerging Market Expansion: Rising demand in Asia, Africa, and Latin America offers vast growth potential, supported by increasing consumer incomes and urbanisation.

• Functional and Nutraceutical Dairy Products: There is growing interest in dairy formulations with added probiotics, proteins, and bioactive compounds for targeted health benefits.

• E-commerce and Direct-to-Consumer Channels: Online retail platforms are expanding market reach and providing greater accessibility to dairy products, particularly in urban centres.

Dairy Market Forecast

The global dairy market is expected to maintain steady growth throughout the forecast period of 2025–2034, supported by sustained demand for milk and value-added dairy products. As the market evolves, innovation, sustainability, and technological advancement will remain central to its expansion.

By 2034, the global dairy market is anticipated to reach USD 799.97 billion, driven by the growing consumer shift towards nutritional and functional dairy offerings, as well as by ongoing product diversification across segments. Asia Pacific will continue to dominate the global landscape, though North America and Europe are expected to lead in premium and sustainable dairy innovations.

Furthermore, digital transformation and traceability will play a critical role in enhancing supply chain efficiency and consumer trust. The integration of sustainable practices and plant-based alternatives alongside traditional dairy production will define the next phase of market evolution.