New Insights:
- The refrigerated dairy sector has experienced significant growth in the retail market, reaching $76 billion in sales over the past year, according to a recent report by CoBank.
- Key products like butter, cheese, and yogurt have been driving this growth, with a 15.4% increase in sales totaling $10.1 billion in the last three years.
- Snackable dairy options, specifically cheese snacks, are expected to see a 6.5% compound annual growth rate through 2034, reaching around $75.1 billion in sales this year.
New Perspective:
Despite the trend of consumers moving away from animal-based products, dairy remains a popular choice as tastes evolve, making it a highly profitable category.
CoBank’s senior economist, Bill Roberts, highlighted that the clean label appeal of dairy products, with minimal ingredients, has resonated well with health-conscious consumers, giving dairy brands an edge in the market.
Interestingly, private label dairy products have also seen an uptick in sales, outperforming premium brands in various categories, as reported by Circana data referenced by CoBank.
Corey Geiger, CoBank’s lead dairy economist, emphasized the diverse applications of dairy products, especially in the healthy snacking segment, which presents opportunities for innovation and growth.
The report also notes the steady rise in cheese consumption by 46% over the past two decades, as well as significant growth in butter and yogurt consumption, driven by products like Greek yogurt and convenient snack options.
Dairy producers have been introducing new product lines to cater to changing consumer preferences, such as dessert-inspired Greek yogurt offerings by Chobani and snack products like Sargento’s Balanced Breaks.
Furthermore, there is potential for further innovation in utilizing dairy in unique ways, such as sweet and spicy cheese products or incorporating yogurt as a protein-boosting ingredient in various food and beverage items.
For instance, the launch of Yough, a frozen pizza brand using Greek yogurt as a primary ingredient, demonstrates the versatility and potential of dairy in creating appealing and nutritious products.