The global buttermilk powder market is estimated to be worth USD 2.7 billion in 2024 and is projected to reach a value of USD 3.8 billion by 2034, expanding at a CAGR of 3.5% over the assessment period of 2024 to 2034
Buttermilk powder is obtained from liquid buttermilk after removal of water. Dry buttermilk must have a protein content of not less than 30%.
Manufacturers are focusing on certifications and claims such as Kosher, ISO, and Halal, etc. which helps manufacturers to gain the trust of consumers. The clean-label and certified packaging is helping to make dry buttermilk powder as promising product to the consumers. Dry buttermilk has end use application as a substitute of skimmed milk. Dry buttermilk is added to enhance the quality, taste, flavor, texture and appearance of food products.
Dry buttermilk increases the nutritional properties, freshness and shelf life of ready-to-cook and processed products. it is a rich source of phosphorus, which helps in building the RNA &DNA, as it is a rich source of phosphorus. Owing to multiple health benefits, the use of dry buttermilk is rising in food and beverage, sports and dietary supplements, and the animal feed industry.
| Attributes | Description |
|---|---|
| Estimated Buttermilk Powder Market Size (2024E) | USD 2.7 billion |
| Projected Buttermilk Powder Market Value (2034F) | USD 3.8 billion |
| Value-based CAGR (2024 to 2034) | 3.5% |
Buttermilk powder is an essential ingredient in the food industry, known for its versatility and functional properties. This analysis delves into key industry trends, drivers, and opportunities influencing the buttermilk powder category, emphasizing its applications, health benefits, and sustainability factors.
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Increasing On-the-go Food Consumption
Changing lifestyles and rising urbanization have influenced prevailing trends as consumers select either ready-to-use or finished products. The demand for semi-processed products is less as consumers prefer not to waste time in cooking.
Ready-to-go products are high in demand, especially among the working demographic. Thus, the demand for processed food is high as consumers increasingly demand for products that are innovative as well as nutritious.
Rapid growth of the middle class population, especially in Asia, offers a great opportunity for food processing manufacturers. Moreover, the working population has become more aware of health and wellness due to which they prefer nutritious and healthy ready to cook products.
The dry buttermilk helps to enhance the nutritional properties and shelf-life of ready to cook products. The rising demand for ready to cook products helps to boost the growth rate of dry buttermilk industry.
Soaring Demand from Bakery & Confectionery Industry to Propel Dry Buttermilk Sales Growth
According to a report published by World Bread and Bakery Products, the consumption of bread and bakery products is increasing, and went from 122,000 tonnes in 2007 to 129,000 tonnes in 2016.
Usage of dry buttermilk is increasing in bakery and confectionery products, as dry buttermilk is important to enhance texture, color, flavor, and aroma of various bakery and confectionery products. Dry buttermilk is use as emulsifier and flavor enhancer for bakery and confectionery products.
The health-conscious consumers are increasing rapidly across the globe due to which they prefer low fat and nutritious products. The dry buttermilk is low fat product as well as use for nutritional enrichment. Due to its nutritional properties the use of dry buttermilk is rising in bakery and confectionery products.
Growing Demand in the Food and Beverage Industry
The increasing use of buttermilk powder in various food and beverage applications is a significant industry trend. Its functional properties make it a valuable ingredient in recombined milk, UHT milk, dairy spreads, growing-up milk (infant formula), desserts, bakery products, soups, sauces, flavored milk, and ready-to-drink milk.
The rising consumer demand for ready-to-eat and convenience foods is propelling the use of buttermilk powder. Its ability to enhance flavor, texture, and nutritional value makes it an attractive choice for food manufacturers. The bakery and confectionery segments, in particular, are seeing increased use of buttermilk powder due to its emulsification properties and creamy flavor.
Further innovations in food processing and the development of new product formulations with added benefits such as vitamins, minerals, prebiotics, probiotics etc., presents unique opportunities for buttermilk powder manufacturers. For instance, the growth of the plant-based food sector could lead to the creation of hybrid products that combine dairy and plant-based ingredients, offering a unique category niche. Playing around the functional property of butter milk, fortifying it with various nutritional elements can also allow brands to showcase unique trends in the industry.
Technological Advancements in Production Process
Advances in production technology are improving the quality and efficiency of buttermilk powder manufacturing. Reducing food waste during processing has become one of the primary targets of the manufacturers. Any efforts to minimize waste across each node of the supply chain serves a step forward for a sustainable processing ecosystem. These innovations are leading to products with better heat stability, emulsification properties, and nutritional profiles.
The adoption of advanced spray drying techniques and quality control measures ensures the production of high-quality buttermilk powder. This not only meets stringent food safety standards but also caters to the specific needs of different applications, such as high-heat stable and UHT-grade products.
Investing in research and development to enhance production processes can yield significant benefits. Innovations in drying technology, for instance, can lead to the creation of new product variants with tailored functionalities, opening up new category segments.
Sustainability And Ethical Sourcing Of Raw Material
Sustainability is becoming a crucial factor in consumer purchasing decisions. There is a growing demand for products that are ethically sourced and produced with minimal environmental impact.
Initiatives such as the Bord Bia Origin Green scheme and ISO50001 accreditation highlight the industry's commitment to sustainable practices. Consumers are increasingly looking for transparency in sourcing and production, favoring products that support sustainable dairy farming and energy management.
By emphasizing their sustainability credentials, buttermilk powder producers can differentiate themselves in the industry. This includes sourcing milk from farms adhering to sustainable dairy assurance schemes, reducing greenhouse gas emissions, and promoting animal welfare. Marketing these efforts can enhance brand reputation and attract eco-conscious consumers.
Global Buttermilk Powder sales increased at a CAGR of 3.3% from 2019 to 2023. For the next ten years (2024 to 2034), projections are that expenditure on Buttermilk Powders will rise at 3.5% CAGR
This growth is driven by several factors, including the rising demand for convenient and shelf-stable dairy products, the expanding application of buttermilk powder in various food and beverage sectors, and increasing consumer awareness of its nutritional benefits. The industry is also expected to benefit from advancements in production technologies and the growing emphasis on sustainable and ethically sourced ingredients.
Additionally, the burgeoning food processing industry in emerging industries and the increasing adoption of buttermilk powder in bakery and confectionery products are anticipated to further bolster industies expansion. Enhanced focus on health and wellness trends, coupled with the versatility of buttermilk powder in functional food applications, will likely sustain its demand and foster steady category growth through 2034.
Rapid demand growth for buttermilk powders can also be attributed to several external factors including such as shifts in consumer demographics and evolving consumer preferences also play a huge part in this business space. Urbanization is another factor behind changing lifestyles; long working hours and fewer physical activities are making it difficult for the younger population to follow appropriate proper diet management.
Growing industry reach, which is supported by the increase in disposable income and an expanding middle-class population, helps in industry expansion and penetration. Digital health platforms are expected to push the utilization of Buttermilk Powders.
Principal Consultant
The buttermilk powder industry is characterized by its tiered structure, comprising both organized and unorganized players. The organized segment accounts for 40% of the industry sales, dominated by multinational corporations (MNCs) with annual revenues exceeding 5 million USD. Leading firm are at the forefront, leveraging their extensive production capabilities, sophisticated technological infrastructure, and comprehensive product portfolios to maintain a significant industry presence.
These organized players are adept at meeting stringent regulatory standards and sustaining robust distribution networks, enabling them to capture substantial company share globally. Their advanced research and development facilities further drive innovation, allowing them to introduce a wide array of plant-based ingredients that cater to the evolving preferences of health-conscious and environmentally aware consumers.
On the other hand, the unorganized segment, which constitutes to around 60% of the industry sales, is composed of local, private label players with annual revenues of less than USD 1-2 million. These small, Tier 3 companies, while lacking the global reach of their larger counterparts, play a crucial role in specific regions.
They focus on niche products, offering specialized products that cater to localized demands and specific dietary needs. This segment's flexibility and agility enable these companies to quickly adapt to key trends and consumer preferences, often leading to unique and innovative product offerings.
The coexistence of both large and small companies within the industry ensures a dynamic and competitive industry landscape. This diversity in product offering fosters continuous advancements and a broad spectrum of product choices to customers. Companies targeting niche, new or upcoming segments helps in meeting the diverse needs and preferences of consumers locally as well across the globe. As a result, buttermilk industry is well-positioned for a sustainable growth, driven by innovation and the increasing consumer shift towards healthier and more sustainable food options.
The following table shows the estimated growth rates of the top five countries. The United States and India are set to exhibit high consumption, recording CAGRs of 4.7% and 8.5%, respectively, through 2034.
| Countries | CAGR 2024 to 2034 |
|---|---|
| United States | 4.7% |
| Germany | 8.9% |
| Japan | 7.4% |
| China | 3.5% |
| India | 8.5% |
The sales for Buttermilk Powders in the United States is projected to exhibit a CAGR of 4.7% during the assessment period. Increasing consumer preference for high-protein, functional food ingredients is driving the demand for buttermilk powder, given its rich nutritional profile. Additionally, the booming bakery and confectionery industry in the USA significantly contributes to the sales expansion, as buttermilk powder is a vital ingredient in enhancing the texture and flavor of baked goods.
Moreover, the rise in health-conscious consumers seeking low-fat dairy alternatives is fostering the growth of buttermilk powder sales. The trend towards clean label products, where consumers prefer minimally processed and additive-free ingredients, also benefits the sales, given buttermilk powder's natural and wholesome properties. Furthermore, the robust distribution network and the presence of major food and beverage manufacturers in the USA ensure a steady supply and widespread availability of buttermilk powder, supporting its sales dominance.
The growing awareness and demand for sustainable and ethically produced food products are also playing a crucial role. Many USA producers are focusing on sustainable sourcing and production practices, aligning with consumer preferences and enhancing sales growth. With these factors combined, the United States is set to maintain its leading position in the global buttermilk powder sales throughout the forecast period.
Buttermilk Powder demand in Germany is calculated to rise at a value CAGR of 8.9% during the forecast period (2024 to 2034). By 2034, Germany is expected to account for 17.9% of Buttermilk Powder sales in Europe. This impressive growth can be attributed to several factors such as the country's strong dairy tradition and the rising consumer awareness regarding the health benefits of buttermilk powder.
German consumers are increasingly seeking high-quality, functional food ingredients that support a balanced diet and healthy lifestyle. Buttermilk powder, with its high protein content and versatile applications, meets these demands effectively. Furthermore, the expanding bakery and confectionery sector in Germany is a significant driver, as buttermilk powder is a key ingredient in many traditional and modern recipes, enhancing texture and flavor.
The emphasis on sustainability and traceability in food production is also fueling demand. German consumers prioritize products that are ethically sourced and produced with minimal environmental impact. This aligns with the broader European trend towards sustainability, and buttermilk powder producers in Germany are responding by adopting eco-friendly practices.
Additionally, the increasing popularity of clean label products in Germany is contributing to the industry growth. Consumers are opting for foods with simple, recognizable ingredients, and buttermilk powder, being a natural product, fits well into this category. The robust distribution channels and advanced food processing industry in Germany further support the growing demand for buttermilk powder.
With these factors combined, Germany is poised to become a key player in the European buttermilk powder industry, significantly influencing the region's sales and trends throughout the forecast period.
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| Segment | Type (Spray Dried) |
|---|---|
| Value Share (2024) | 76.4% |
Spray dried buttermilk powder is the most preferred and holds a significant industry share compared to atmospheric roller dried buttermilk powder due to several key advantages. This method produces powder with a fine, uniform particle size and consistent quality, ensuring excellent solubility and ease of reconstitution.
The lower temperatures used in spray drying help preserve natural flavors and nutritional content, resulting in a product with a more authentic taste and higher retention of essential nutrients. Its superior functional properties, such as better emulsification and heat stability, are crucial for various applications, including baked goods, dairy spreads, and beverages.
Additionally, the low moisture content achieved through spray drying extends the shelf life of the product, making it convenient for storage and transportation. The powder's versatility allows it to be easily incorporated into a wide range of food products, enhancing texture, flavor, and nutritional profile.
Growing demand for high-quality, functional food ingredients drives the preference for spray dried buttermilk powder, supported by advancements in spray drying technology that ensure consistent quality and efficiency. These factors collectively contribute to its dominance in the buttermilk powder industry.
| Segment | Online Pharmacies (Sale Channel) |
|---|---|
| Value Share (2024) | 56.7% |
B2B (Business-to-Business) sales play a crucial role in leading buttermilk powder sales, significantly shaping the industry dynamics. In the B2B segment, buttermilk powder is primarily sold to food and beverage manufacturers, bakeries, confectioneries, and the dairy industry. These businesses leverage buttermilk powder's functional properties to enhance their product offerings, including baked goods, dairy spreads, soups, sauces, and ready-to-drink beverages.
The bulk purchasing power of B2B customers enables suppliers to achieve economies of scale, leading to cost efficiencies and more competitive pricing. This, in turn, encourages large-scale procurement of buttermilk powder. Moreover, the stringent quality and safety standards demanded by B2B customers ensure that suppliers maintain high production standards, fostering trust and long-term business relationships.
Additionally, the B2B industry benefits from the growing trend of customized product solutions. Manufacturers often require specific formulations of buttermilk powder to meet unique product requirements, such as high heat stability or low spore content. Suppliers who can offer tailored solutions gain a competitive edge, further driving B2B sales.
Technological advancements in food processing and the increasing focus on sustainable and traceable supply chains also support the growth of B2B buttermilk powder sales. Businesses are increasingly prioritizing suppliers that adhere to sustainable practices, ensuring that their products meet the evolving preferences of eco-conscious consumers.
Overall, the B2B segment's demand for high quality, functional, and customizable buttermilk powder continues to lead industry sales, highlighting the importance of business partnerships and large-scale industrial applications in driving industry growth.
The buttermilk powder industry is highly consolidated, dominated by a handful of major players who control the majority of the production and supply. These key players leverage advanced production technologies, extensive distribution networks, and strong brand recognition to maintain their industry leadership. Companies such as Tipperary Co-op and other prominent dairy producers have established themselves as the primary manufacturers, driving innovation and setting industry standards.
In contrast, numerous smaller companies and regional players primarily engage in the procurement and rebranding of buttermilk powder. These companies typically source buttermilk powder from the leading local or domestic manufacturers, reformulating it to meet specific industry needs. This approach allows smaller players to offer a diverse range of buttermilk powder products without the significant investment required for processing of such high value products.
Local-domestic brands generally offers unique specialized products with prepositions specific to local taste and flavour. These brands are quick in leveraging the consumer relationship developed or their ability to adapt a local product as compared to a MNC brand. These brands offers personalized flavour profiles, packaging, portion sizes, fostering strong bond with the brand.
Large global brands are quick in utilizing their network and established distribution channels. Such companies often invest heavily on research and development and are ready to innovate the product as per customer demand. Such large organizations benefits from economies of scale and can adapt to continuous shift in customer preferences. Increasing demand for customized and specialty buttermilk powder formulations has led to a rise in private-label offerings, catering to niche industry and specific consumer preferences.
Despite the industry being consolidated at global level, competition remains robust w.r.t individual products due to ever evolving consumer preferences. The focus has largely shifted to snackification of butter milk. Snack-sized serving portions and nutritional values shall be the key focus of the customer while searching for these brands on retail shelves.
As per product type, the industry has been categorized into Atmospheric Roller Dried, Spray Dried.
Different sales channels include B2B (Hotels, Restaurants, Cafes) and B2C (Hypermarkets /Supermarkets, Convenience Stores, Mom and Pop Stores, Discount Stores, Food & Drink Specialty Stores, Independent Small Groceries, Online Retail and other retail formats)
Industry analysis has been carried out in key countries of North America, Latin America, Europe, East Asia, South Asia, Oceania, and the Middle East & Africa.
The global Buttermilk Powder market is estimated at a value of USD 2.7 billion in 2024.
Sales of Buttermilk Powders increased at 3.8% CAGR between 2019 and 2023.
Hoogwegt Group, All American Foods, Contenental Dairy Facilities, LLC, Agropur, Fonterra Co-operative Group Limited, DFA Ingredients solutions, IPS-Ingredis, North Cork Creameries, Lactalis Ingredients are some of the leading players in this market.
The North American market is projected to hold a revenue share of 31.4% over the forecast period.
Europe holds 27.8% share of the global market for Buttermilk Powders.
1. Executive Summary
2. Industry Introduction, Including Taxonomy and Market Definition
3. Market Trends and Success Factors, Including Macro-economic Factors, Market Dynamics, and Recent Industry Developments
4. Global Market Demand Analysis 2019 to 2023 and Forecast 2024 to 2034, including Historical Analysis and Future Projections
5. Pricing Analysis
6. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034
6.1. Product Type
6.2. Sales Channel
6.3. Region
7. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, by Product Type
7.1. Atmospheric Roller Dried
7.2. Spray Dried
8. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, by Sales Channel
8.1. B2B
8.1.1. Hotels
8.1.2. Restaurants
8.1.3. Cafes
8.2. B2C
8.2.1. Hypermarkets /Supermarkets
8.2.2. Convenience Stores
8.2.3. Mom and Pop Stores
8.2.4. Discount Stores
8.2.5. Food & Drink Specialty Stores
8.2.6. Independent Small Groceries
8.2.7. Online Retail
8.2.8. Others Retail Formats
9. Global Market Analysis 2019 to 2023 and Forecast 2024 to 2034, by Region
9.1. North America
9.2. Latin America
9.3. Europe
9.4. East Asia
9.5. South Asia
9.6. Oceania
9.7. Middle East and Africa
10. North America Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries
11. Latin America Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries
12. Europe Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries
13. East Asia Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries
14. South Asia Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries
15. Oceania Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries
16. Middle East and Africa Sales Analysis 2019 to 2023 and Forecast 2024 to 2034, by Key Segments and Countries
17. Sales Forecast 2024 to 2034 by Product Type, Sales Channel for 30 Countries
18. Competition Outlook, including Market Structure Analysis, Company Share Analysis by Key Players, and Competition Dashboard
19. Company Profile
19.1. Hoogwegt Group
19.2. All American Foods
19.3. Contenental Dairy Facilities, LLC
19.4. Agropur
19.5. Fonterra Co-operative Group Limited
19.6. DFA Ingredients solutions
19.7. IPS-Ingredis
19.8. North Cork Creameries
19.9. Lactalis Ingredients
19.10. NOW Health Group
19.11. Dairygold Deutschland Handels GmbH
19.12. California Dairies, Inc
19.13. Westland Milk Products
19.14. Valio Ltd.
19.15. Uelzena Group
19.16. Numidia BV
19.17. ACE International LLP
19.18. Bempresa
19.19. Michigan Milk Producer Association
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Buttermilk Powder Market
