Explore Opportunities in Dairy Snacks Industry

Opportunities in Dairy Processing Industry

The global dairy snacks market was valued at US$ 214 Billion in 2021 and is projected to reach US$ 302 Billion by 2027, growing at a CAGR of 6%. India is currently the world’s largest producer of milk which has opened a plethora of opportunities in the dairy snacks industry. Cheese, Yoghurt, and Ice cream are the most popular dairy snacks in the market. In dairy products, calcium is present in abundance.

As consumers constantly search for products that are healthy and all-natural, dairy snacks are positioned as an attractive option because of their mouth-watering taste and also due to the presence of plenty of nutrients such as riboflavin, magnesium, calcium, pantothenic acid, and vitamin B12 and B5.

Germany, France, and the UK are the major markets for dairy snack products but the Asia-Pacific region is considered the fastest growing market due to urbanization, increasing disposable income, and rising population.

Recent studies have proved that dairy snacks help in reducing the risk of colorectal cancer, osteoporosis, and type 2 diabetes. Growing awareness about the benefits of dairy snacks has increased the demand for them across the globe. Dairy processing industries are now developing a wide range of products to meet consumer tastes and preferences.


Market Trends in Dairy Snacks Food Industry:

    1. Dairy processing industries are now introducing fortified dairy snacks by increasing the nutritional content of iron, plant sterols, and stanols to attract people concerned more about nutrition, fitness, and health
    2. Due to the rise in the number of lactose intolerant consumers, manufacturers are also introducing lactose-free variants.
    3. Manufacturers are also developing low-calorie dairy snacks to cater to health-conscious consumers.

Dairy Snacks Industry Market Segmentation:

Based on Dairy Products:

    1. Ice Cream
    2. Yogurt
    3. Cheese
    4. Butter
    5. Buttermilk
    6. Others

Based on Distribution Channels:

    1. Convenience Stores / departmental stores
    2. Supermarkets
    3. Online channels
    4. Others

Based on End Use:

    1. HoReCa
    2. Food and Beverage industry

Rising Demand For Natural Cheese:

The cheese market in India was valued at INR 56 billion in 2021 and is projected to reach INR 211 billion by 2025, growing at a CAGR of 24% during the forecast period. As calcium, protein, and vitamin D is present in abundant quantity, consumers consider cheese as a nutritious snack. Due to the influence of western cuisines, Indians are slowly shifting toward the trend of using cheese in fast food items such as pizzas, sandwiches, tacos, garlic bread, pasta, burgers, wraps, cakes, etc.

As cheese is a naturally functional whole food, brands are promoting cheese as a healthy snack. To attract consumers, manufacturers are introducing cheese in a variety of flavours such as red chili flakes, oregano, and pepper. They are more popular in Europe and North America, and their popularity is now spreading worldwide including in India.



The yogurt market was valued at USD 107 billion at a global level in 2021 and is projected to touch USD 162 billion by 2029 as the rising popularity of low-fat, low-sugar desserts is propelling the yogurt market.

Dairy processing industries are now making yogurt more interesting by adding flavours such as strawberry, vanilla, marshmallow, tutti fruity, passion fruit, mango, bubble gum, etc. These flavours are developed mainly to target children. Some manufacturers have developed a kombucha yogurt range that uses the culture in kombucha and consists of flavors such as mango, hibiscus, ginger, lemon, etc.

Dairy Market Growth

Opportunities in Ice Cream Industry:

The ice cream market in India was valued at INR 165 Billion in 2021 and is projected to reach INR 436 Billion by 2027 due to the improvements in cold chain infrastructure, application of efficient management procedures, and procurement of trained operational and servicing personnel.

Ice cream market is segmented by both flavours and format. By flavours, ice cream market is divided into chocolate, vanilla, fruit, and many more. By format, the ice cream market is divided into cups, sticks, cones, bricks, etc.

market segment ice cream

Top Trends in The Ice Cream Industry:

❖ Low-calorie ice cream:

Due to an increase in health awareness, demand for low-calorie and keto-friendly ice cream is growing at a rapid pace.

❖ Ice cream with added functional benefits:

Ice cream with added functional ingredients such as protein, fiber, probiotics, and CBD is attracting consumers

❖ Flavours mashups:

Mashups between different flavours such as a combo of balsamic and strawberries, french fries with vanilla ice cream, and bacon ice cream are in huge demand worldwide.

❖ Vanilla flavoured ice cream products to capture major market share by 2029:

According to market analysts, among other flavours, the vanilla flavour is slated to dominate the market by 2029, and the chocolate flavour is expected to hold the second largest market share.

❖ The cup format is expected to dominate the ice cream market :

On the basis of packaging, the cup segment is expected to dominate the market due to the convenience associated with this type of packaging.

❖ Unique toppings:

Ritz crackers, caramel corn, wasabi peas, and other different toppings, textures, and combinations of fillings are gaining consumer attraction to a large extent.

❖ Bakery and dessert-inspired flavours:

Indulgent flavors like birthday cake and chocolate chip cookie dough chunks are becoming hot favorites of consumers at a global level.

Dairy snacks packaging:

Packaging plays a vital role in protecting the food against external elements such as moisture, air, light, and harmful pathogens such as bacteria and viruses, preventing decomposition making the food product stay fresh with an increased shelf life to stay fit for use for a longer duration after production.

Packaging helps in retaining the original shape and texture of food product by making sure it does not get crushed, flattened, or punctured.

New packaging methodologies such as active packaging, intelligent packaging, and engineering science offer innovative solutions that play a crucial role in increasing shelf life by monitoring food quality and safety to increase shelf life.


Some of the common packaging methods used in the dairy processing industry:

❖ PET bottles:

Earlier, milk was available in cartons. Today, milk, yogurt, and smoothies are available in PET bottles as they allow brands to differentiate themselves from competitors. Also, PET bottles can be blow molded into different shapes and sizes which enables brands to come up with unique designs. Another advantage of PET bottles is they are lightweight which allows them to be carried around easily.

❖ Flexible packaging:

The usage of flexible packaging is increasing as it offers the convenience of re-sealability and requires less space. Recently, dairy processing industries have started to use flexible packaging to pack yogurts, particularly for children as they are attracted to the squeezability factor and to pouches that are sippable.

❖ Small and convenient packaging:

Consumers prefer dairy snack products that are sold in small packages as they are convenient to carry and store. Processing industries are now selling yogurt on a stick and cheese in single-serve packs and one such example is a cheese stick from Jarlsberg Cheese whose snacks are individually wrapped pieces of cheese in stick format and packaged firmly. These are considered perfectly suitable for on-the-go snacking, back-to-school lunches, and picnics.

❖ Packaging made from milk protein:

The American Chemical Society recently presented research on a packaging film made of milk proteins and said that protein-based films are powerful oxygen blockers that help prevent food spoilage.

The U.S. Department of Agriculture is developing an environmentally friendly film made of milk protein casein that is said to be up to 500 times better than plastics in protecting food against oxygen. Milk protein packages can be used as biodegradable packaging material and more sustainable, breaking down easier than plastics.

Are you looking to start and scale up your dairy processing industry?

If you are an entrepreneur or business owner and looking to start and grow your dairy processing business, contact SolutionBuggy to get all the services such as detailed project report, product development, machinery installation, packaging, business development, etc. SolutionBuggy being recognised as India’s largest consulting platform in the food and beverage sector, handholds you in every step in setting up the dairy processing industry.

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