Global Dairy Products Market Overview, 2024-29

Market Dynamic

Market Drivers • Growing Population and Urbanization: The global population continues to grow, particularly in urban areas. The rising urban population, with its changing dietary habits and preferences, contributes to the increased consumption of dairy products. Urbanization is often linked to higher incomes and greater exposure to a variety of food choices, including different dairy products. • E-Commerce and Digitalization: The advent of e-commerce has transformed the way consumers access and purchase dairy products. Online platforms provide convenient options for ordering and home delivery, especially for specialty and imported dairy items. The ease of online shopping contributes to the accessibility and availability of a wide range of dairy products. Market Challenges • Regulatory Changes and Standards: The dairy industry faces challenges related to evolving regulations and standards governing food safety and quality. Producers must adapt to changing regulatory landscapes, which may involve adjustments to production processes, labeling requirements, and compliance with international standards. • Price Volatility of Raw Materials: The dairy industry is susceptible to fluctuations in the prices of raw materials such as milk. Volatility in commodity prices can impact the profitability of dairy producers and affect the overall stability of the market. Producers may face challenges in managing costs and maintaining price competitiveness. Market Trends • Clean Label and Transparency: With an increasing focus on health and wellness, consumers are demanding transparency in food labeling. The clean label trend in the dairy industry involves using simple and recognizable ingredients. Products labeled as "natural," "organic," and "free from additives" are gaining traction among health-conscious consumers. • Digital Marketing and Branding: The dairy industry is leveraging digital platforms and social media for marketing and brand promotion. Producers are engaging with consumers through online channels to communicate product benefits, share recipes, and build brand loyalty. Digital marketing plays a crucial role in connecting with younger demographics. • Regional and Cultural Influences: Regional and cultural influences play a significant role in shaping the types of dairy products consumed. Producers are recognizing the importance of catering to diverse flavor preferences and culinary traditions. This trend has led to the introduction of region-specific dairy products to meet the unique tastes of different consumer segments. Covid-19 Impacts Lockdowns, restrictions on movement, and disruptions in transportation posed significant challenges to the dairy supply chain. These disruptions affected the timely delivery of raw materials, packaging, and finished products, leading to temporary shortages in some regions. Restrictions and safety measures implemented to curb the spread of the virus resulted in labor shortages, affecting dairy farms and processing plants. The shortage of skilled labor impacted production capacities, contributing to supply chain bottlenecks. The closure of restaurants, cafes, and foodservice establishments led to a decline in demand for certain dairy products meant for the hospitality sector. Conversely, there was an increase in demand for dairy products in retail channels as consumers shifted towards cooking and consuming meals at home. With lockdowns and social distancing measures in place, there was a surge in online shopping for groceries, including dairy products. E-commerce platforms became vital channels for consumers to access a wide range of dairy items without visiting physical stores. The dairy industry heavily relies on international trade, and disruptions in global logistics and trade routes affected the export and import of dairy products. Fluctuations in currency values and changing demand dynamics in different regions further influenced export volumes. The dairy industry experienced price volatility for raw materials, such as milk, due to supply chain disruptions and changing demand patterns. Producers faced challenges in managing costs and maintaining stable pricing for their products. Some consumers opted for more budget-friendly options, influencing the demand for certain dairy products. Dairy products, known for their nutritional value, including vitamins, minerals, and proteins, gained attention as consumers sought to bolster their overall health. There was an increased interest in functional dairy products with added health benefits, such as probiotics and vitamins, to address specific health concerns. Producers responded to consumer demand by innovating and introducing products that align with emerging health trends.

Key Development

• May 2023: Aavin is a state government co-operative that announced the launch of its all-new milk products fortified with vitamins A and D. As per the company, these new launches are to estimate the demand for fortified milk products in the market. • August 2022: Dairy Farmers of America (DFA) acquired two Extended Shelf-Life (ESL) processing facilities from Smith Foods. The two processing plants are in Pacific (Missouri) and Richmond (Indiana) in the U.S. These facilities became part of the DFA’s dairy brands division and operated as Pacific Dairy Solutions and Richmond Beverage Solutions. • October 2022: Unilever partnered with ASAP to distribute its ice creams. Under the partnership, ASAP will also deliver ice cream and snacks from Unilever's virtual store, The Ice Cream Shop. • July 2022: GCMMF launched over 100 products, including products from different categories. These products include milk items in several variants of ginger, tulsi, and turmeric. Out of these 100 products, most of the products are milk-based. Therefore, this product launch helped the company expand its business through the expansion of its product portfolio.