Milk Fat Fractions Market Report 2025

The milk fat fractions market size has grown strongly in recent years. It will grow from $16.18 billion in 2024 to $17.31 billion in 2025 at a compound annual growth rate (CAGR) of 7%. The growth in the historic period can be attributed to dairy industry growth, consumer preferences for healthy fats, processed food industry demand, confectionery and bakery applications, dairy product innovation, international trade and globalization.

The milk fat fractions market size is expected to see strong growth in the next few years. It will grow to $21.9 billion in 2029 at a compound annual growth rate (CAGR) of 6.1%. The growth in the forecast period can be attributed to growing demand for specialty ingredients, plant-based alternatives, functional dairy products, e-commerce expansion, global expansion of dairy markets. Major trends in the forecast period include clean label and natural ingredients, customization and tailored solutions, dairy product innovation, technological advancements in fractionation, collaborations and partnerships.

The growing demand for dairy products is anticipated to drive the expansion of the milk-fat fractions market in the coming years. Dairy products include milk and items derived from it, such as butter, cheese, ice cream, yogurt, and condensed or dried milk. Milk fat fractions contribute to the texture, flavor, color, structural properties, and functionality of dairy products like butter, cream, cheese, and dairy powders. As a result, the rising demand for dairy products is expected to boost the milk fat fractions market. For example, in November 2023, the International Dairy Foods Association, a US-based trade organization, reported that cheese consumption reached a record high in 2022, with nearly 42 pounds consumed per person, an increase of half a pound per person compared to 2021. Thus, the increased demand for dairy products is fueling the growth of the milk-fat fractions market.

The rising demand for bakery products is expected to drive the growth of the milk-fat fractions market in the future. Bakery products are foods made from flour or grains, baked in an oven, and sold in bakeries. Milk fat fractions are used in bakery items to enhance their tenderness, crumbliness, and overall mouthfeel. For example, in February 2024, Agriculture and Agri-Food, a department of the Canadian government, reported that retail sales of baked goods in the United States reached $82.9 billion in 2022, with an expected growth rate of 3.1% from 2023 to 2027, reaching $97.7 billion by 2026. As a result, the increasing demand for bakery products is contributing to the expansion of the milk-fat fractions market.

Leading companies in the milk fat fractions market are increasingly focusing on strategic partnerships to strengthen their competitive position. These collaborations are essential for addressing consumer demands and overcoming market challenges more effectively. For example, in July 2024, Nourish Ingredients, an Australian technology firm, teamed up with Fonterra, a dairy company from New Zealand, to develop innovative dairy products using fermentation-based, animal-like fats. This partnership aims to combine Nourish's expertise in specialty fats with Fonterra’s dairy capabilities. It also reflects a broader trend in the food industry, where established businesses are joining forces with innovative startups to explore new ingredient technologies.

In June 2022, Ehrmann, a Germany-based dairy products manufacturer, acquired FrieslandCampina's dairy business for an undisclosed amount. This strategic acquisition enables Ehrmann to leverage FrieslandCampina's existing infrastructure and brands to expand its presence in the Russian dairy market. Furthermore, the acquisition of the production facility allows Ehrmann to locally produce dairy products, leading to cost reduction and improved supply chain efficiency. FrieslandCampina, a Netherlands-based provider of dairy cooperative and milk fat fractions, adds significant value to Ehrmann's portfolio through this acquisition.

In April 2023, the German dairy products manufacturer Unternehmensgruppe Theo Müller completed the acquisition of FrieslandCampina for a sum of $326.313 million. This strategic move expands, diversifies, and enhances Unternehmensgruppe Theo Müller's dairy products portfolio, fortifying the company's market presence in Germany. FrieslandCampina, a Netherlands-based dairy cooperative and provider of milk fat fractions, now becomes an integral part of Unternehmensgruppe Theo Müller's growing and enriched dairy products business.

Major companies operating in the milk fat fractions market include Glanbia plc, Uelzena Milchwerke eGmbH, FIT Company, Oleo-Fats Incorporated, Koninklijke VIV Buisman B.V., Flechard S.A.S., Wilmar International Limited, MCT Dairies Inc., The Tatua Co-operative Dairy Company Ltd., Comarco Group, Anand Milk Union Limited, Saputo Dairy, Shanghai Guangyu Food Co. Ltd., United Dairy Group Ltd., Royal FrieslandCampina N.V., Groupe Lactalis, Arla Foods, Agropur Cooperative, Land O'Lakes Inc., Dairy Farmers of America, DMK Deutsches Milchkontor GmbH, Meggle Group, Hoogwegt Group, Molkerei MEGGLE Wasserburg GmbH & Co. KG, Armor Proteines, Lactoprot Deutschland GmbH, Carbery Group, Orafti S.A.

North America was the largest region in the milk fat fractions market in 2024. Asia-Pacific is expected to be the fastest-growing region in the global milk fat fractions market during the forecast period. The regions covered in the milk fat fractions market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the milk fat fractions market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Milk fat fractions denote distinct components, such as triglycerides composed of fatty acids and glycerol, constituting the fat found in milk. These fractions play a crucial role in providing nourishment and essential vitamins to the human body, including vitamin E and K2 soluble vitamins.

The primary categories of milk fat fractions encompass low melting fractions, medium melting fractions, and high melting fractions. Low melting fractions (LMF) specifically pertain to components of milk fat with a melting point lower than that of the main milk fat triglycerides. These LMFs find application in various food products, including bakery and confectionery items, ice cream, and dairy spreads. Key technologies utilized in their extraction and processing include dry fractionation, solvent fractionation, supercritical fluid extraction, and short-path distillation. These technologies manifest in different forms such as texturized, concentrated, and isolated, and are employed in diverse sectors such as nutritional and nutraceuticals, cold spreadable butter, sports nutrition, infant formulas, confectionery, bakery, among others.

The milk fat fractions market research report is one of a series of new reports that provides milk fat fractions market statistics, including milk fat fractions industry global market size, regional shares, competitors with a milk fat fractions market share, detailed milk fat fractions market segments, market trends and opportunities, and any further data you may need to thrive in the milk fat fractions industry. This milk fat fractions market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The milk fat fractions market consists of revenues earned by entities by providing various technologies such as melt crystallization, short-path distillation and supercritical CO2 extraction. The market value includes the value of related goods sold by the service provider or included within the service offering. The milk fat fraction market also includes sales of milk fat globule membrane (MFGM) fraction, short-chain fatty acid (SCFA) fraction, and medium-chain fatty acid (MCFA) fraction. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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