Dairy Blends Market Size, Share, By Product Type, Form, Flavor, Application, Distribution Channel, and Region - Trends, Analysis, and Forecast till 2035

• By 2035, the dairy blends market size is expected to grow to a value of about USD 5.8 billion.
• In 2024, the Dairy Blends market was valued at USD 2.8 billion.
• It is growing at a CAGR of 8.2%. 

Dairy blends refers to concentrated mixtures that combine dairy components, such as cream or butter with non-dairy ingredients. Further, dairy blends are typically formulated by combining cream or butter with non-dairy ingredients, such as vegetable oils, cocoa, and various flavorings. The target market is experiencing significant growth, which is driven by the increasing consumer demand for healthier and more versatile dairy alternatives.

For instance, in April 2023, a leading Finnish dairy company Valio has launched a new infant-grade skimmed milk powder, Valio Prime SMP. The dry blend-optimized product offers infant milk formula (IMF), which is manufactured using a more straightforward production process while ensuring the highest microbiological quality. The innovative new product Valio Prime SMP is the result of decades of acclaimed research and development. Valio is already making waves in the industry with this most recent innovation in a segment where product releases are uncommon.

Key Takeaways:

• North America held the largest share of the market in 2024 as countries, such as China and India are significant contributors to focused market growth. The growth is attributed to the rising disposable incomes and increasing demand for dairy products particularly infant formula and baby food across the region.
• Asia Pacific is expected to be the fastest-growing market during the forecast period as it is tempered by strict regulations and the emergence of dairy substitutes, such as soy-based products in the region.
• By product type, the milk-based blends segment is expected to account for the largest share of the Dairy Blends market in the upcoming years as the popularity of milk-based products driven by consumer preference for traditional dairy flavors and nutritional benefits.

Key Drivers of Target Market:

Rising Health Consciousness is expected to Boost Market Growth

Increasing awareness of health and wellness among consumers is driving demand for healthier alternatives to traditional dairy products. Dairy blends often offer reduced fat and calorie options, making them appealing to health-conscious consumers seeking nutritious food choices.        

• For instance, in July 2022, Danone has developed the new Dairy & Plants Blend baby formula, a nutritionally complete formulation that combines the best of both dairy and plants. The new baby formula is the 1st specifically created for a vegetarian diet, and is the 1st blended formula for healthy babies in which more than half the required protein is derived from soy. 

Rising Disposable Incomes is Expected to Speed up Market Expansion

Increasing disposable incomes among consumers, particularly in emerging markets, are leading to a shift in preferences toward premium and designer dairy blends product types. Consumers are willing to invest in high-quality fixtures that enhance aesthetics and functionality driving the dairy blends market growth.   

• For instance, in February 2023, Keventers, an iconic Indian Dairy brand known for its Milkshakes and Ice-creams, is all set to expand its product portfolio pan India with the launch of its first line of vegan delicacies. This brand new range is 100% plant-based and gluten-free, a treat for people with dietary restrictions including gluten intolerance and dairy allergies. With no artificial ingredients or added flavor, it is an excellent choice for all, especially for those who prefer lactose-intolerant diets, all dairy-free and delightful. 

Restraints:

Price Sensitivity Hinders Focused Market Growth

Although dairy blends are cost-effective fluctuations in raw material prices affects the final product pricing making it challenging to maintain competitive pricing in a price-sensitive industry.

• Counterbalance Statements: Price sensitivity is balanced by consumers growing emphasis on wellness and health. Higher price points for innovative products are supported by consumers’ willingness to spend more for dairy blends that provide nutritional advantages, such as reduced fat content or additional vitamins and minerals.  

Opportunities & Market Trends:

Innovation in Product Development to Boost Future Market Expansion 

• Continuous innovation in dairy blend formulations can lead to the introduction of new flavors and product types, appealing to diverse consumer preferences. This includes developing blends that cater to specific dietary restrictions, such as lactose-free or plant-based options. 
• For instance, in May 2023, Califia Farms, a leading, premium, plant-based beverage brand, announced the launch of Califia Farms Complete, a deliciously creamy plant milk with nine essential nutrients, eight grams of protein, all nine essential amino acids, and half the sugar of dairy milk. Made from a special blend of pea, chickpea, and fava bean protein, Califia Farms Complete offers consumers the perfect way to meet their nutritional needs, all from plant sources. It is available now at Target, Walmart, and other retailers nationwide with a suggested retail price of USD 6.69. 

The dairy blends market is classified into product type, form, flavor, application, distribution channel, and region.

Product Type:

Dairy blends market by product type is categorized into milk-based blends, butter-based blends, yogurt-based blends, cheese-based blends, and others. The milk-based blends segment is expected to dominate over the forecast period as this segment has gained traction due to the increasing consumer demand for healthier and more functional food options.

• For instance, in November 2024, Silk Kids patented oat milk blend which targets children’s nutritional need. This blend is formulated with kid’s nutrition in mind featuring a proprietary vitamin and mineral blend that differentiates the brand within the booming plant based milk category.

Form:

By form, the dairy blends market is segmented into spreadable, powder, and liquid. The powder segment holds a dominant dairy blends market share due to its widespread use in creating infant formulas and food products, and its role as a stabilizer and sweetener in yogurt and ice cream.

• For instance, in October 2023, Nestlé launched the company's first affordable and nutritious instant powder in Central and West Africa that is made with a blend of milk and plant ingredients. Combining the "double goodness" of milk with locally grown soy, it is a source of calcium and iron, along with important nutrients, such as fiber and protein. The adaptable product, which was created locally by Nestlé specialists at the regional R&D center in Abidjan, Côte d'Ivoire, goes well with a range of cereals, porridges, and beverages.

Flavor:

The dairy blends market by flavor is categorized into regular, vanilla, chocolate/cocoa, fruit flavors, and other flavors. The regular segment is expected to dominate over the forecast period as it is favored due to its widespread acceptance and versatility in various applications, making it a preferred choice among consumers and manufacturers alike. Regular dairy blends often serve as a base for numerous products. 

Application:

By application, the dairy blends market is segmented into bakery and confectionery, infant formula, processed foods, and others. The infant formula segment dominates the focused market share as it is designed to provide essential nutrients to infants who are not breastfed or require supplementation. These products are formulated to closely mimic human milk's nutritional profile, ensuring that infants receive adequate protein, fats, vitamins, and minerals for their growth and development.  

Distribution Channel:

By distribution channel, the dairy blends market is segmented into online (e-commerce, online retail, and others) and offline (supermarkets/hypermarkets, specialty stores, and others). The offline segment dominates the focused market share as it include traditional retail channels, such as supermarkets, hypermarkets, and specialty stores where consumers typically purchase dairy products. While online sales are growing, the offline retail remains the primary distribution channel for dairy blends due to the established consumer purchasing habits and the need for product visibility and sampling.

Region:

Geographically, the market is studied across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.

North America: This region is expected to dominate the target market share as North American consumers favor convenient and ready-to-use food products. Further, dairy blends available in various forms, such as powders, spreads, and liquid concentrates, caters to this demand for easy-to-use ingredients in cooking and baking in this region.  

• For instance, in February 2023, Kraft Natural Cheese, a leading dairy brand, announced the launch of Kraft Signature Shreds. This new product innovation offers consumers a unique, restaurant-style, thick-cut, natural shredded cheese to elevate their homemade meals with an unrivaled melt and rich, satisfying flavor that is optimal for the cheesiest dishes. Kraft Signature Shreds are available in three debut offerings for the ultimate recipe versatility: Cheddar Blend, Mozzarella Blend, and Mexican Blend, all conveniently packaged in 8 oz resealable bags.

Asia Pacific: This is the largest and fastest-growing region in target market as dairy blends in this region are often more affordable than traditional dairy products, such as butter and cream, which makes them an attractive option for consumers and manufacturers alike. Further, their longer shelf life and ease of storage also enhance their appeal.

Dairy Blends Market Report Scope:

Segmentation:

By Product Type:

• Milk-Based Blends
• Butter-Based Blends
• Yogurt-Based Blends
• Cheese-Based Blends
• Others

By Form:

• Spreadable
• Powder
• Liquid 

By Flavor:

• Regular
• Vanilla
• Chocolate/Cocoa
• Fruit Flavors
• Other Flavors

By Application:

• Bakery and Confectionery
• Infant Formula
• Processed Foods
• Others 

By Distribution Channel:

• Online

• E-Commerce
• Online Retail
• Others

• Offline

• Supermarkets/Hypermarkets
• Specialty Stores
• Others

By Region:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • U.K.
  • France
  • Russia
  • Italy
  • Spain
  • Netherlands
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • Australia
  • Indonesia
  • Malaysia
  • South Korea
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Argentina
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • Israel
  • South Africa
  • Rest of Middle East & Africa

The key players operating in the dairy blends market include Yili Group, Danone, China Mengniu Dairy Company Limited, and others. The focused market is characterized by a highly competitive environment, with several major companies actively involved in product development, strategic partnerships, and market expansion.    

For instance, in October 2020, Amul has entered into value added camel milk products by launching its newest offering in the form of Camel Milk powder and Camel Milk Ice cream. Camel milk is known to have numerous health benefits. It is rich in minerals, improves gut health, and helps in boosting immunity. Amul Camel milk powder is made from natural camel milk procured from camel herders in Kutch region of Gujarat. The milk undergoes stringent testing and quality control before being converted to camel milk powder in Amul’s modern, state-of-the-art plants.

List of Key Players in the Market:

• Yili Group
• Danone
• China Mengniu Dairy Company Limited
• Arla Foods
• GCMMF (Amul)
• Almarai
• Nestlé
• Mother Dairy
• Kwality Limited
• Parag Milk Foods Limited
• Karnataka Milk Federation
• Dynamix Dairy Industries Limited
• Britannia Industries Ltd.
• Kerry Group plc.

• In December 2024, Boulder, Colorado-based plant-based brand Earth Balance has launched vegan European-style butter. The dairy-free company’s newest product, called European Style Buttery Spread, is made from a blend of non-GMO, organic vegetable oils, pea protein isolate, and a hint of salt. Compared to traditional dairy-based butter, Earth Balance’s new vegan butter contains zero trans fats.
• In December 2024, Kreol Travel Retail has announced the launch of Anchor Milk Powder sachets (1.6kg) at Muscat Duty-Free. The product, made in New Zealand by Fonterra, reflects Anchor’s commitment to quality and nutrition. This launch enhances our product range, providing travelers with more choice and convenience.
• In September 2024, Parle Agro, a leader in beverage innovation, has launched SMOODH Lassi, marking a significant addition to its expanding dairy portfolio. Building on the success of SMOODH flavored milk, this new offering aims to disrupt the Indian dairy market by introducing a high-quality, affordable lassi that promises to deliver exceptional growth. The launch is supported by the largest-ever multi-channel campaign in the lassi category, featuring brand ambassador Varun Dhawan.
• In May 2024, abCoffee, a prominent grab-and-go coffee chain in India’s retail market has launched the country’s first-ever range of 13 coconut-based, non-dairy beverages. This innovation caters to the growing demand for plant-based alternatives, offering both coffee and non-coffee options tailored for modern consumers.
• In December 2023, Blue Diamond, the world’s leading producer and marketer of almonds, announces a new addition to its selection of Almond Breeze products with the launch of Almond Breeze Original Almond & Oat Blend. Almond Breeze Original Almond & Oat Blend combines the delicious flavor of the best California almonds with the creaminess of oat for a creamy and dairy-free milk for any occasion. It has more calcium than dairy milk and fewer calories and less sugar than other oat milk available on the market.

Analyst View:

Dairy blends market presents numerous opportunities for growth driven by health trends, innovative product offerings, and changing consumer demographics. Further, dairy blends, particularly those that are fat-free or fortified with nutrients, caters to health-conscious consumers, which aims healthier alternatives to traditional dairy products in upcoming years.

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