Global Lactose-Free Dairy Market - 2023-2030

Overview

Global Lactose-Free Dairy Market reached US$ 11.9 billion in 2022 and is expected to reach US$ 20.7 billion by 2030, growing with a CAGR of 7.2% during the forecast period 2023-2030.

The global lactose-free dairy market has undergone significant growth and evolution in recent times, reflecting shifts in consumer preferences and an increased emphasis on health and wellness. The expansion of this market is driven by a set of key factors that align with changing consumer preferences, as they are experiencing a condition called lactose intolerance.

Major key players have made substantial investments in marketing campaigns and educational initiatives aimed at increasing awareness about lactose intolerance and promoting the advantages of their lactose-free dairy offerings. These efforts have fostered greater consumer awareness and subsequent demand. Lactose-free dairy products are now readily available in mainstream grocery stores and supermarkets, ensuring widespread accessibility for consumers.

Similarly, North America dominates the Lactose-free dairy market, capturing the largest market share of over 1/3rd. The growth is due to the significant proportion of the populace in North America experiences lactose intolerance. The incidence of this condition grows greater in certain ethnic communities, and lactose intolerance is frequently more prevalent among North America's diverse population. A large proportion of Native Americans and African Americans (80%) are lactose intolerant, according to statistics from Boston Children's Hospital.

Dynamics

Increasing Awareness on Lactose-Free Dairy Products among Consumers

People are actively looking for alternatives to conventional dairy products as awareness grows. Many customers are looking for nutritional options that support their health objectives in a culture that places a high value on health and wellbeing. For those who encounter problems like diarrhea after ingesting conventional dairy, lactose-free dairy products offer a solution.

Beyond lactose intolerance, certain individuals have sensitivities or allergies to dairy products. Milk substitutes that are less inclined to cause allergic responses include lactose-free products. The manufacturers are continuously putting efforts to expand their lactose-free products. This includes lactose-free variations of common dairy-based products including yogurt, cheese, milk and ice cream, as well as non-dairy substitutes.

In August 2023, plant-based casein created by Pureture "fully replicates" the flavor, consistency, and functionality of conventional protein. The non-GMO protein, which has no taste, color, or smell and can be used in dairy-alternative products like cheese, milk, and yogurt, comes at a time when the dairy-free dairy industry is attempting to recreate the crucial processes required to bring vegan cheese closer to its dairy equivalent.

Increasing health consciousness among customers is evident in their active pursuit of goods that complement their dietary choices and wellness objectives. For people who want to cut back on or completely avoid lactose in their diets while still gaining access to vital dairy elements like calcium, lactose-free dairy is viewed as a better option.

The Surge in the Adoption of Alternative Milk Products

Many consumers gravitate toward alternative milk products for perceived health advantages. Depending on the type, these alternatives may offer lower calorie content, unique nutrient profiles, or fortification with additional vitamins and minerals, making them an appealing choice for health-conscious individuals.

The market for alternative milk products has undergone significant expansion, presenting a diverse array of choices in terms of flavors, textures, and applications. This innovation appeals to consumers who appreciate variety and novelty in their dietary selections. Companies within the alternative milk industry have made substantial investments in marketing and promotional activities, spotlighting the advantages of their products. This heightened visibility and awareness have stimulated consumer interest and adoption.

Alternative milk products have transitioned from niche to mainstream, becoming integral components of everyday dietary patterns. They are no longer viewed solely as substitutes but as versatile ingredients suitable for cooking, baking, and beverages. As individuals embrace diverse dietary preferences such as vegan, vegetarian, or flexitarian diets, alternative milk products have become essential elements of these lifestyles, further bolstering their popularity.

Challenges in Taste and Texture

Crafting lactose-free dairy products presents a distinctive challenge concerning their flavor and texture. Natural sweetness is present in lactose, so the absence of it makes the milk tasteless and the creaminess of ice cream and yogurt will be missed in the lactose-free milk-based products, Hence, the mouthfeel of consumers lacks in satisfying their taste criteria.

Manufacturers invest considerable resources in research and development endeavors to address these taste and texture challenges. Achieving a taste and texture that faithfully replicates traditional dairy products frequently requires the inclusion of stabilizers, thickeners, or sweeteners. Nevertheless, replicating the precise sensory experience can prove intricate and resource-intensive. Some consumers may find lactose-free alternatives less appealing, which can limit their adoption and brand loyalty.

Limited Awareness

An integral restraint within the lactose-free dairy market pertains to the limited awareness and understanding of lactose intolerance and the advantages offered by lactose-free products. Numerous individuals grappling with lactose intolerance may remain unaware of their condition or may underestimate the availability of suitable alternatives. This dearth of awareness can impede market expansion as potential consumers continue to endure digestive discomfort by consuming traditional dairy products.

Furthermore, there exist misconceptions concerning lactose-free dairy, including the mistaken belief that it exclusively serves individuals with medically prescribed dietary needs. Consequently, these misconceptions can restrict its appeal to a broader consumer base. To counter this, comprehensive educational initiatives are imperative to enlighten consumers about lactose intolerance, its prevalence, and the digestive health benefits tied to lactose-free dairy.

Segment Analysis

The global lactose-free dairy market is segmented based on product, form, functionality, distribution channel and region.

Increased Demand for Lactose-free Milk

The milk segment held 34.5% of the global market share. The increasing popularity of lactose-free milk is due to consumer preferences and the shifting patterns of consumers' diets. Lactose intolerance conditions are rising among consumers across the world, which is the major factor driving the market growth during the forecast period 2023-2030.

According to Medline Plus data, after infancy, lactose digestion becomes more difficult for about 65 percent of the human population. People of East Asian heritage are most likely to have lactase non-persistence, with 70 to 100% of people in these groups being affected. People with lactose intolerance will not be able to digest lactase milk, which can lead to various health problems such as intestinal problems, digestive issues, and many more.

In June 2022, the introduction of lactose-free cow milk was announced by Provilac, one of India's neo-age premium milk delivery companies that is expanding the fastest. The angel-funded start-up, which now has a 50 Cr. yearly turnover, intends to greatly increase its milk supply. With this launch, Provilac hopes to take between 10 and 20 percent of the lactose-free milk market, which is expected to be worth between 350 and 400 billion in the next two to three years.

Geographical Penetration

Demand for Fortified Milk Products in North America

The North America lactose-free dairy market held the largest market share of 40.3% in 2022 in the lactose-free dairy market analysis. The demand for lactose-free dairy products in the North American market has significantly expanded recently, supported by a confluence of variables that resonate with dietary requirements, client preferences, and an elevated focus on health.

The North American lactose-free dairy companies have expanded their product line to meet a variety of tastes and nutritional needs in response to the soaring demand. This encompasses lactose-free renditions of traditional dairy staples alongside innovative plant-based alternatives derived from sources such as soy, almonds and more.

Around 36% of Americans have lactose malabsorption, according to statistics from the National Institutes of Health. The condition of lactose malabsorption is the cause of lactose intolerance. However, the chances of getting lactose intolerance are high among Americans. Hence, they prefer lactose-intolerant dairy products, which are gaining demand in the market.

Beyond lactose intolerance, North America has witnessed a surge in individuals with dairy allergies or sensitivities. Lactose-free dairy products provide a secure and flavorful alternative for those who must steer clear of dairy due to allergic reactions or intolerances connected to milk proteins like casein. This expanding consumer base contributes to the burgeoning demand for lactose-free dairy across the region.

Competitive Landscape

The major global players in the market include: Danone, Nestle SA, Danone S.A., Lactalis, The Kraft Heinz Company, Valio Ltd., Green Valley Creamery, Arla Foods, Dean Foods, Daiya Foods and Califia Farms.

COVID-19 Impact Analysis

The onset of the COVID-19 pandemic had immediate and enduring effects on the lactose-free dairy market. In the initial phases, as the virus spread globally, consumers engaged in stockpiling behaviors, leading to a sudden surge in the sales of dairy products, including lactose-free alternatives. This abrupt spike in demand resulted in short-term disruptions in the supply chain, with manufacturers grappling to meet the heightened consumer requirements.

Moreover, the pandemic underscored the significance of health and well-being, prompting consumers to prioritize products perceived as conducive to their immune systems and overall health. Lactose-free dairy, known for its perceived digestive advantages and nutrient-rich profiles, gained favor among health-conscious consumers. This inclination towards health and wellness-driven consumption has endured beyond the immediate crisis, bolstering the long-term growth potential of the lactose-free dairy market.

However, there were also challenges brought about by the pandemic. Economic uncertainties and job losses prompted some consumers to opt for more cost-effective alternatives, which could potentially impact premium-priced lactose-free dairy products. Additionally, disruptions in the supply chain and increased production costs had repercussions on pricing and the availability of products.

Russia-Ukraine War Impact Analysis

The Russia-Ukraine conflict has likewise left its mark on the lactose-free dairy market. Ukraine, a significant agricultural producer, including dairy items, can wield substantial influence over global markets. Any disruption in Ukraine's ability to export dairy products, including lactose-free dairy, can lead to price fluctuations and supply hurdles in international markets.

Furthermore, the conflict has amplified global economic uncertainties, influencing consumer purchasing power and preferences. In regions directly impacted by the war, consumers may encounter disruptions in the supply of lactose-free dairy products due to logistical complexities and shifting priorities.

Additionally, trade restrictions and geopolitical tensions can exert an impact on international trade in dairy products, potentially affecting the availability of lactose-free dairy in various regions. Markets dependent on imports may face difficulties in securing a consistent supply of lactose-free dairy products, potentially resulting in price escalations or shortages.

By Product

• Milk
• Cheese
• Yogurt
• Others

By Form

• Powder
• Liquid
• Solid

By Functionality

• Probiotic Enriched
• Fortified with Vitamins and Minerals
• Others

By Distribution channel

• Supermarkets/Hypermarkets
• Specialty Stores
• Convenience Stores
• E-Commerce
• Others

By Region

• North America
  • U.S.
  • Canada
  • Mexico

• Europe
  • Germany
  • UK
  • France
  • Italy
  • Russia
  • Rest of Europe

• South America
  • Brazil
  • Argentina
  • Rest of South America

• Asia-Pacific
  • China
  • India
  • Japan
  • Australia
  • Rest of Asia-Pacific

• Middle East and Africa

Key Developments

• In August 2023, for yogurt enthusiasts, lactose-free Greek yogurt was introduced by Bharat Skyr & Doodh Products, a recognized brand among premium milk product producers called Skyrrup. Skyrrup's Greek Yoghurt, which has 7.5 grams of protein and is created from A2 Cow Milk, not only offers vital nutrition but also satisfies the senses.
• In June 2022, the launch of lactose-free cow milk was announced by Provilac, one of India's neo-age premium milk delivery companies that is expanding the fastest. The angel-funded start-up, which now has a 50 Cr. yearly turnover, intends to greatly increase its milk supply. With this introduction, Provilac hopes to take a 10-20 percent market share of the 350-400 billion dollar lactose-free milk market during the next two to three years.
• In August 2021, a number of newly developed items are being introduced by the cultured food company's brand good culture, including its first lactose-free line and squeezable sour cream pouches. The products contain live and active cultures and are created using pasture-raised milk from small family farms in the Midwest.

Why Purchase the Report?

• To visualize the global lactose-free dairy market segmentation based on product, form, functionality, distribution channel and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of Lactose-free dairy market-level with all segments.
• The PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as Excel consisting of key products of all the major players.

The global lactose-free dairy market report would provide approximately 70 tables, 69 figures and 202 Pages.

Target Audience 2023

• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies