CHEESE MARKET ANALYSIS

Cheese Market Size and Trends

The global cheese market is estimated to be valued at USD 104.16 Bn in 2024 and is expected to reach USD 151.51 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 5.5% from 2024 to 2031.

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The consistent rise in demand for packaged and processed dairy products across both developed and emerging economies is driving the growth of the global cheese market. Changing dietary patterns and increasing preference for western food is further fueling the sales of cheese-related products globally.

Changing consumption patterns and rising health awareness

With increasing health consciousness among consumers globally, their eating habits and food choices have been evolving significantly over the past decade. While cheese was historically seen as an indulgence, consumers are now viewing it in a new light - as a nutritious and convenient snack or ingredient that can add protein and calcium to meals and diets. As busy lifestyles take over and people increasingly dine out or order in, snacking has become integral part of daily lives. This has opened up opportunities for cheese as nutritious snacking options are in demand.

Another key factor is the growth of the working population and dual income households especially in developing nations. With both adults engaged in jobs, they have lesser time to cook elaborate meals at home which is driving the demand for easy to make and fast-food options. Processed and packaged cheese slices, shreds and snacks are finding more acceptance due to their ease of preparation whether home or outdoor consumption. As a result, traditional cheese varieties are losing ground while nutritional cheese variants designed for snacking occasions are witnessing higher growth rates.

Changing societies and evolving family structures are also impacting cheese preferences. For example, in regions where multi-generational families previously lived together, greater number of nuclear families now demand food items that cater to their smaller household size and changing tastes. Lightly-flavored mild cheese cuts and snack packs fulfill these newer requirements of portability and individual portion control. At the same time, consumers have grown more aware of specific health factors like calories, fats, and allergens due to the spread of medical information online and via social media. This has accelerated interest in low-fat, low-sodium, probiotic, and lactose-free cheese varieties in recent times.

Market Concentration and Competitive Landscape

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Innovations in cheese product variants

The cheese market has been highly innovative to benefit from rising demand by adapting to new trends, preferences and occasions of consumption. In many developed cheese markets that are reaching saturation, continuous introduction of novel types keeps consumers interested with exciting new flavors, textures and attributes. Some innovative variants gaining strong footing include specialty, artisan and organic cheese along with novel flavor blends and ingredients used.

Among popular variants witnessing growth are ball or log-shaped mini cheeses for snacking. Their bite-sized pieces strike the right balance for on-the-go eating versus large slices or blocks meant for full meals. Travel-friendly cheese sticks, cubes, and balls in re-sealable packaging have excellent portability. Flavor innovations include exotic varieties like Wasabi, Chipotle, Black Truffle, etc. that appeal to adventurous palates open to new tastes. Fusion cheeses combining flavors from different cuisines are another unique concept gaining ground. For example, cheeses with olive, chorizo or salami pieces infused within appeal to those seeking both flavors together.

As demands for dairy alternatives surge globally, non-dairy cheese products using plant-based substitutes like cashew, coconut, or soy are revolutionizing the industry. Their nutritional profiles suit vegan, lactose intolerant as well as health-conscious consumers. Novel formats involve spray dried cheese powders enabling easy conversions into sauces, dressings and other applications. Application-specific shreds, slices and chunked pieces tailored for pizzas, burgers, and sandwiches offer superior melting properties. For health-oriented buyers, low lactose, low cholesterol, and low-fat cheese products deliver maximum nutrition at minimum calories.

Key Takeaways from Analyst:

The global cheese market continues to witness solid growth opportunities across various regions. Europe remains the dominant region due to high per capita consumption as cheese is an integral part of the cuisine. However, Asia Pacific is witnessing the fastest growth with countries like India and China experiencing increasing western influence leading to a surge in demand for packaged and processed cheese products.

While various factors drive the global cheese demand higher, the market also faces challenges. Fluctuating milk prices directly impact the production cost for cheese manufacturers. Strict regulations pertaining to food quality and safety standards impose an increasing compliance burden. Moreover, a shift to vegan diets and alternative dairy products act as a restraint.

Nevertheless, opportunities lie in catering to the evolving consumer demands. The rising health-conscious trend among consumers have led to newer product launches with low fat, high protein, and probiotic options. Innovation in cheese varieties, flavors, and formats are gaining traction. Further, expanding distribution networks into developing countries and growing consumption outside the household present avenues for market expansion. Emerging economies with improving household incomes and exposure to western food also provide headroom for growth.

Market Challenges: Stringent food regulations

The global cheese market has been facing stringent regulations surrounding food production and safety standards. Various countries and regions have implemented strict rules regarding milk sourcing, production processes, packaging, and other areas of cheese manufacturing. Complying with these evolving regulations has increased compliance costs for cheese producers. The regulations often differ between markets, making international expansion more complex. Small- and mid-size producers in particular find it challenging to keep up with changes to food laws. Addressing multiple regulatory compliance protocols has also made cheese supply chains more complex to manage on a global scale. The industry expects regulatory pressures to further intensify going forward, especially with regard to aspects like antibiotic use, food labelling, and hygienic practices. Effective regulatory strategies will need to be devised by market players to ensure ongoing productivity while adhering to compliance standards.

Market Opportunities: Growing vegan and lactose-free cheese alternatives

The global cheese market has been provided an opportunity through the expanding demand for vegan and lactose-free cheese alternatives. More consumers are adopting vegan, vegetarian, or dairy-free diets due to various factors like health concerns, ethical beliefs, lifestyle changes, or food allergies such as lactose intolerance. As a result, many food companies have introduced innovative plant-based or lactose-free cheese substitutes made from ingredients like soy, nuts or plant cell cultures. These cheese alternatives aim to mimic the flavors, textures, and usages of traditional dairy cheese. Major players have invested in improving the taste, meltability, and functionality of these non-dairy substitutes. The growing offerings and consumer interest in vegan cheese present lucrative market potential. Through new product development and effective marketing, companies can capitalize on the demand for vegan and lactose-free alternatives as this segment within the global cheese market continues its projected expansion.

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Insights by cheese type: Consumer Preference Drives Hard Cheese Consumption

In terms of cheese type, hard cheese is expected to contribute 38.8% share of the market in 2024, owing to high consumer preference. Hard cheeses like Parmigiano Reggiano, Pecorino Romano, and Grana Padano have robust flavors that appeal to a large consumer base globally. Their longer shelf life compared to other varieties also makes them a popular choice for everyday snacking and cooking. The ability to easily store and consume hard cheeses on the go has further increased their uptake. Meanwhile, emerging middle classes in developing nations are blending hard cheeses into their diets at a rapid pace to mimic western cuisine. The versatile applications of hard cheeses in salads, sandwiches, pasta dishes, etc. continue stimulating greater trial and repeat purchases among consumers.

Insights by cheese form: Convenience Boosts the Block/Wheel Format

In terms of form, block/wheel is expected to contribute 44.7% share of the market in 2024, owing to the convenience it provides to consumers and food processors. The block or wheel format allows for easy portions to be sliced or shredded as required. This enables hassle-free usage of cheese in pizzas, wraps, burgers and other applications. The intact block structure also helps prevent wastage and extend shelf life compared to pre-shredded or sliced cheese variants. Foodservice providers heavily rely on block cheeses for their durability and portion control benefits. At home, block cheeses are a time-saving option for busy consumers. Their ability to be kept intact for longer periods without loss of quality or texture has made the block format extremely popular.

Insights by distribution channel: One-Stop Shopping Drives Hypermarket Dominance

In terms of distribution channel, supermarkets/hypermarkets is expected to contribute 44.4% share of the market in 2024, driven by consumers’ tendencies for one-stop shopping. Hypermarkets afford customers the convenience of accessing a wide range of cheese types, brands, and formats under a single roof. Alongside a diverse selection of other grocery items, this one-stop shopping format has emerged as the default choice for regular household merchandise. Store loyalty programs and joint promotional schemes by hypermarkets to push cheese sales have also boosted their market dominance. Their prominence on digital platforms allows for convenient online shopping and product research, further cementing their popularity over specialized retailers.

Regional Insights

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Europe has firmly established itself as the dominant region in the global cheese market. The region is expected to account for 40.3% of the market share in 2024. Countries like France, Germany, Italy, and the U.K. have a long history of cheese making and consumption. The culture of using cheese in meals, snacks, and desserts is deeply ingrained in the European populace. Moreover, the presence of large dairy cooperatives and cheese producers in Europe makes it the largest supplier globally. It exports specialty and artisanal cheeses, generated through traditional production methods, to several international markets. The aging and curing capabilities available with European producers have helped them gain dominance over New World cheese makers. The lucrative pricing that specialty European cheeses command also signifies their high brand equity and perception of superior quality across geographies.

Another region that is fast emerging as a cheese powerhouse is Latin America. Countries like Brazil, Argentina, and Chile have witnessed rapid growth in domestic cheese consumption over the past decade. Their warm and tropical climate is well-suited for rearing dairy cattle and producing milk. More importantly, rising incomes of the middle-class population combined with growing Western influence on cuisine and snacking habits have elevated the demand for cheese. Additionally, Latin Americannations have signed several bilateral and multilateral trade agreements improving their access to foreign markets. Particularly, Brazil has effectively utilized these agreements to bolster its cheese exports. Its ability to produce cheese at competitive costs has made Brazilian cheeses popular in Asia Pacific and Africa. Continued economic and population growth in Latin America bodes well for the region to further cement its position as a fast-growing force in the global cheese market.

Market Report Scope

Cheese Industry News

• In March 2024, Franklin Foods launched its new plant-based cream cheese brand, SimplyV, in grocery stores. This innovative product is designed to cater to the growing demand for plant-based alternatives, offering consumers a delicious and versatile option for spreads, dips, and cooking.
• In April 2024, Kraft Natural Cheese introduced a new product line called Kraft Flavor Fusions. The line features shredded cheese blends that combine Kraft's classic cheese varieties with unique flavor profiles.
• In June 2022, Land O Lakes Cheese launched its Land O Lakes Shredded Cheese line in Wisconsin, featuring seven different shredded cheese products available in the dairy section of grocery stores
• In 2022, Saputo produces, markets, and distributes a wide array of dairy products of the utmost quality, including cheese, fluid milk, extended shelf-life milk and cream products, cultured products, and dairy ingredients. Saputo Cheese USA Inc. launched the 'Frigo Cheese Heads Swirls' on-the-go snacking item, which is offered under the brand name 'Frigo Cheese Heads,' and consists of mozzarella and cheddar cheese twisted together to make swirls.

*Definition: The global cheese market comprises companies that produce and market various types of cheese worldwide. It includes nationally and internationally known brands that make cheddar, mozzarella, parmesan and numerous specialty cheeses from cow, goat and sheep milk. The market provides cheeses for various applications like snacks, dairy products, ready-to-eat meals and fast-food items. Key players focus on developing innovative cheese varieties, customized for different regional tastes and culinary uses.

Market Segmentation

• Cheese Type Insights (Revenue, USD Bn, 2019 - 2031)
  • Hard Cheese
  • Soft Cheese
  • Semi-Hard Cheese
  • Fresh Cheese
•  Cheese Form Insights (Revenue, USD Bn, 2019 - 2031)
  • Block/Wheel
  • Shredded/Grated
  • Sliced
•  Distribution Channel Insights (Revenue, USD Bn, 2019 - 2031)
  • Supermarkets/Hypermarkets
  • Specialty Stores
  • Online/E-commerce
  • Foodservice/HoReCa
• Regional Insights (Revenue, USD Bn, 2019 - 2031)
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Argentina
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • Spain
    • France
    • Italy
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • South Korea
    • ASEAN
    • Rest of Asia Pacific
  • Middle East
    • GCC Countries
    • Israel
    • Rest of Middle East & Africa
• Key Players Insights
  • The Kraft Heinz Co.
  • Arla Foods Inc.
  • Bongrain SA
  • Fonterra Co-Operative Group Ltd.
  • Fromageries Bel S.A.
  • Mondelez International Group (Kraft)
  • Sargento Foods Inc.
  • Almarai Company Ltd.
  • Saputo Inc.
  • Royal FrieslandCampina N.V.
  • Groupe Lactalis S.A
  • Emmi
  • Land O'Lakes, Inc.
  • Lactose A/S
  • Dairiconcepts, L.P.
  • FrieslandCampina
  • Kanegrade Limited
  • Aarkay Food Products Ltd.
  • Kerry Group Plc
  • Dairy Farmers of America Inc