Dairy Ingredients Market 2025 | Growth Drivers, Key Players & Investment Opportunities

Market Size and Growth

Global Dairy Ingredients Market reached USD 58.5 billion in 2022 and is expected to reach USD 83.1 billion by 2031 growing with a CAGR of 4.5% during the forecast period 2024-2031.

Key Development:

United States: Recent Dairy Ingredients Developments

✅ In June 2025, Cayuga Milk Ingredients unveiled its expanded facility in Auburn, New York - part of a multi-million dollar expansion to boost its capacity in producing consumer goods dairy ingredients there.

✅ In March 2025, Arla Foods partnered with Valley Queen (South Dakota) to begin manufacturing whey protein concentrate under its Nutrilac ProteinBoost line - targeting enhanced protein offerings for food & beverage applications.

✅ In January 2025, three major East Coast dairy cooperatives (Agri-Mark; Maryland & Virginia Milk Producers; Upstate Niagara Cooperative) launched a joint venture named Integrated Dairy Ingredients (IDI), to market and sell high-quality ingredients like nonfat dry milk, skim milk powder, and buttermilk powder.

Japan: Recent Dairy Ingredients Developments

✅ In July 2025, Fonterra emphasized growing demand in North Asia (including Japan) for functional dairy ingredients targeting wellness and active aging, positioning its product development accordingly to meet nutritional and demographic needs.

✅ In April 2025, Japan launched a 5-year plan to modernize its dairy industry, with policy measures including updated standards for functional dairy foods, stricter labeling/ingredient safety rules, and subsidies for modern equipment for small-scale farmers.

✅ In early 2025 (H1, ending May), Lacto Japan reported a 27.6% year-on-year increase in net sales for its ingredients division, with rising demand in Japan as well as Southeast Asia and China.

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Dairy Ingredients Market refers to the wide range of milk-derived components such as milk powders, whey proteins, casein, lactose, and milk fat used in food, beverages, sports nutrition, infant formula, and bakery products. These ingredients provide essential nutrition, functionality, and texture enhancement. The market is driven by rising demand for protein-rich diets, functional food innovations, and the growing application of dairy ingredients in health & wellness products, with strong adoption across global food processing and nutraceutical industries.

Key Players:

-> Fonterra Co-operative Group Limited, Saputo Inc., Volac International Limited, Arla Foods, Dairy Farmers of America, Nestle S.A, Hatsun Agro Products, Glanbia PLC, Groupe Lactalis, Devondale Murray Goulburn.

Growth Forecast Projected:

The Global Dairy Ingredients Market is anticipated to rise at a considerable rate during the forecast period, between 2024 and 2031. In 2023, the market is growing at a steady rate, and with the rising adoption of strategies by key players, the market is expected to rise over the projected horizon.

Research Process:

Both primary and secondary data sources have been used in the global Dairy Ingredients Market research report. During the research process, a wide range of industry-affecting factors are examined, including governmental regulations, market conditions, competitive levels, historical data, market situation, technological advancements, upcoming developments, in related businesses, as well as market volatility, prospects, potential barriers, and challenges.

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Key Segments:

By Source: Milk, Whey

By Type: Milk Powder, Whey Ingredients, Lactose & Derivatives, Casein & Derivatives, Others

By Livestock: Cow, Sheep, Others

By Application: Pediatric, Sports Nutrition, Medical Nutrition, Functional Food, Bakery, Animal feed, Others

Regional Analysis for Dairy Ingredients Market:

⇥ North America (U.S., Canada, Mexico)

⇥ Europe (U.K., Italy, Germany, Russia, France, Spain, The Netherlands and Rest of Europe)

⇥ Asia-Pacific (India, Japan, China, South Korea, Australia, Indonesia Rest of Asia Pacific)

⇥ South America (Colombia, Brazil, Argentina, Rest of South America)

⇥ Middle East & Africa (Saudi Arabia, U.A.E., South Africa, Rest of Middle East & Africa)

Benefits of the Report:

Chapter 1: Sets the stage by outlining the report's coverage, summarizing key market segments by region, product type, and application. Presents a snapshot of market sizes, growth potential across segments, and anticipated industry evolution both short and long term.

Chapter 2: Highlights pivotal market insights and uncovers the most significant emerging trends driving change within the industry.

Chapter 3: Offers an in-depth look at the competitive landscape among Dairy Ingredients producers, including revenue shares, strategic moves, and recent mergers and acquisitions.

Chapter 4: Presents comprehensive profiles of the market's key players, delving into details such as revenue, profit margins, product portfolios, and company milestones.

Chapters 5 & 6: Analyze Dairy Ingredients revenue at both regional and country levels, providing quantitative breakdowns of market sizes, growth opportunities, and development prospects worldwide.

Chapter 7: Focuses on different market segments by type, examining their individual sizes and potential, guiding readers toward high-impact, untapped market areas.

Chapter 8: Explores segmentation by application, evaluating industry growth potential in various downstream markets and pinpointing promising sectors for expansion.

Chapter 9: Provides a thorough review of the industry's supply chain mapping out both upstream and downstream activities.

Chapter 10: Concludes with a summary of the report's key findings and highlights the most critical takeaways for industry stakeholders.

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FAQ

What is the current size of the Dairy Ingredients Market?

A: In 2022, the Dairy Ingredients Market was valued at USD 58.5 billion, reflecting its strong industry presence.

Q2: How large is the Dairy Ingredients Market expected to be by 2031?

A: By 2031, industry forecasts suggest the Dairy Ingredients Market will grow to around USD 83.1 billion , demonstrating significant expansion.

Q3: What is the growth rate of the Dairy Ingredients Market?

A: The market is projected to expand at a compound annual growth rate (CAGR) of 4.5% during the forecast period from 2024 to 2031.

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