Buttermilk Powder Market Size, Share, and Growth Forecast from 2025 - 2032

Buttermilk Powder Market Size and Share Analysis

The global buttermilk powder market is predicted to reach a size of US$ 3.2 Bn by 2025. It is anticipated to showcase a CAGR of 7.1% during the forecast period to attain a value of US$ 5.2 Bn by 2032.

Buttermilk powder is recognized for its high protein and essential nutrient content, making it highly preferred in functional foods and beverages. This demand is fueled by health-conscious consumers and the rising popularity of fitness-centric products.

• According to studies, the global protein ingredient market is predicted to surge at a CAGR of 6.5% from 2023 to 2032, creating substantial growth opportunities for buttermilk powder as a protein source.

Powdered buttermilk is widely used in the production of bakery products owing to its flavor-enhancing properties and ability to enhance the texture and shelf life of baked goods.

• The global bakery products market is estimated to reach US$ 720 Bn by 2032, driving demand for buttermilk powder as a key ingredient.

Key Highlights of the Industry

• Rising use in dairy-based beverages and functional drinks are propelling demand for buttermilk powder as these enhance texture, taste, and nutritional value.
• Consumers are seeking products with clean-label ingredients and free from artificial additives, thereby fostering growth of organic buttermilk.
• Boom in online retail has made it a dominant sales channel for buttermilk powder with prominent companies leveraging e-commerce platforms to broaden consumer reach.
• Innovations in packaging technologies are extending the shelf life of buttermilk powders while maintaining product freshness.
• Buttermilk powder’s long shelf life and ease of use make it an attractive option for manufacturers of instant food mixes, soups, and sauces.
• Inclusion of buttermilk powder in animal feed and pet food formulations in gaining traction owing to its nutritional properties.
• Based on nature, the conventional segment is likely to hold a share of 82% in 2025 owing to its high shelf stability.
• By end use, the food and beverage industry is anticipated to hold share of 72% in 2025 due to rising demand for instant foods.
• In terms of distribution channel, the business-to-business segment is likely to hold a share of 83% in 2025 owing to availability of customization services.
• Buttermilk powder market in North America is set to exhibit a CAGR of 6.1% through 2032 owing to shift toward clean-label ingredients.

Market Attributes	Key Insights
Buttermilk Powder Market Size (2025E)	US$ 3.2 Bn
Projected Market Value (2032F)	US$ 5.2 Bn
Global Market Growth Rate (CAGR 2025 to 2032)	7.1%
Historical Market Growth Rate (CAGR 2019 to 2023)	6.2%

Shift toward Natural Ingredients in North America to Bolster Demand

North America buttermilk powder market is estimated to hold a share of 38.1% in 2025. The region has a robust dairy production infrastructure that supports large-scale manufacturing of buttermilk powder. It also benefits from novel dairy processing technologies and efficient distribution networks. For instance,

• According to the USDA, the U.S. is the largest diary producer in the world with an output of 223 Bn pounds of milk in 2022. This robust production base supports the availability of buttermilk and its derivatives.

Rising awareness of functional food products and their health benefits in the region is driving demand for buttermilk powder as a protein-rich ingredient in various food applications. Consumers in North America are seeking clean-label products that are free from artificial additives and preservatives, leading to a surging demand for buttermilk powder as a natural ingredient.

High Shelf Stability of Conventional Buttermilk Powder to Spur Demand

Conventional is projected to hold a share of 82% in 2025. Conventional buttermilk powder is more affordable to produce compared to its organic alternatives. This is supported by less stringent production requirements and higher yields from conventional dairy farms.

• Production cost of conventional dairy farming is 30% lower compared to organic dairy farming.

Manufacturers in the food and beverage industry prefer conventional buttermilk powder for applications in baked goods, dairy products, and snacks due to its consistent availability and competitive pricing.

• Conventional dairy ingredients account for 75% of dairy usage in food processing in key markets like North America and Europe.

Conventional buttermilk powder undergoes standardized processing techniques that ensure longer shelf life, better solubility, and enhanced emulsification properties. This makes it ideal for large-scale food production.

• Conventional buttermilk powder products have a typical shelf life of 24 months, compared to shorter durations for organic variants due to fewer preservatives.

Demand for Instant and Processed Food and Beverages to Facilitate Adoption

The food and beverage industry is anticipated to hold a share of 72% in 2025. Powdered form of buttermilk is a popular ingredient in baked goods owing to its ability to enhance flavor, texture, and shelf life. It is widely used in dairy-based beverages, smoothies, and ready-to-eat snacks due to its nutritional value and ease of incorporation.

The food and beverage industry is incorporating functional and clean-label ingredients. Buttermilk powder is valued for its natural composition and functional properties. This includes emulsification, thickening, and flavor enhancement.

Powdered buttermilk is extensively used in instant food mixes, soups, sauces, and dressings owing to its longer shelf life and easy storage. It is gaining immense popularity as a nutritional ingredient in health-focused food and beverage products.

Business to Business Channel to Offer Customization Services

Business to business (B2B) is predicted to hold a share of 83% in 2025. B2B sales enable food manufacturers and processors to procure buttermilk powder in bulk, leading to cost savings and operational efficiencies. For instance,

• Bulk purchasing through B2B channels can reduce procurement costs by 20% to 30%, compared to smaller retail purchases.

Restaurants, bakeries, and catering services are key consumers of buttermilk powder, particularly in regions where baked goods and dairy-based menu items are in high demand. Business to business distribution channels are optimized for large-scale transactions and have well-established supply chains that ensure timely delivery and consistent product quality. For example,

• A survey revealed that 75% of dairy ingredient transactions in North America and Europe occur through B2B channels.

B2B suppliers often offer customized solutions that cater to the specific requirements of manufacturers. This includes providing tailored packaging, private labelling, and formulation assistance.

Buttermilk Powder Market Introduction and Trend Analysis

Potential growth in the global buttermilk powder industry is predicted to be driven by increased use in infant nutrition, sports supplements, and health-focuses snacks. Technological developments in processing and packaging of buttermilk powder products are also likely to improve visible appeal.

Apart from its nutritional value, buttermilk powder has excellent functional qualities like texture enhancement and emulsification. Natural emulsifiers, such as proteins and phospholipids, aid in solidifying fat in the mixture and guaranteeing that important fatty acids are distributed evenly. This characteristic is especially significant for hydrolyzed formulas intended for babies with sensitive digestive systems.

Nestlé NAN Supreme Pro, for example, uses buttermilk powder that is high in phospholipids to give it a creamy mouthfeel and better absorption of nutrients, making it more like human breast milk. Additionally, buttermilk powder's subtle, creamy flavor improves the taste of baby formulas and increases newborns' acceptance of it.

Historical Growth and Course Ahead

The buttermilk powder market growth was steady at a CAGR of 6.2% during the historical period from 2019 to 2023. The industry witnessed moderate growth owing to rising demand for dairy-based ingredients in the bakery and confectionery sectors. Increased popularity of functional food and clean-label products contributed to this growth.

Food and beverage industry's innovation in snack formulations and health-conscious products further drove demand for buttermilk powder. Rising demand for high-protein and low-fat ingredients in health-focused food formulations spiked sales.

The forecast period is likely to witness an increasing focus on sustainability and clean-label ingredients in the industry. Growth of e-commerce distribution channels is likely to enhance the availability of buttermilk powder.

Market Growth Drivers

Increasing Adoption in Diary-based Beverages and Snacks

Buttermilk powder is used as a key ingredient in dairy-based drinks such as smoothies, protein shakes, and flavored milk products to enhance texture and nutritional value. Its ability to blend well and improve the stability of formulations makes it an ideal choice for manufacturers.

Consumers are seeking high-protein and low-calorie snacks made from dairy ingredients where buttermilk powder is used for its nutritional profile and creamy flavor. Health bars, savory snacks, and cheese-based products now frequently incorporate buttermilk powder as an ingredient.

Buttermilk powder is a key ingredient in flavored yogurt, probiotic beverages, and fermented dairy snacks due to its ability to improve mouthfeel and enhance flavor. Demand for fermented dairy products, which promote gut health, has further fueled the adoption of buttermilk powder.

Longer Shelf Life Compared to Liquid Dairy Products

Buttermilk powder has a shelf life of 12 to 24 months when stored under proper conditions, compared to liquid buttermilk which spoils within 7 to 10 days when refrigerated. This difference in storage duration minimizes the risk of spoilage and reduces wastage throughout the supply chain.

Powdered buttermilk is shelf-stable and can be transported and stored without refrigeration unlike liquid dairy products that require continuous refrigeration. This characteristic decreases logistics costs, especially for international shipping. For example,

• Global cold chain logistics market allocates 30% of operating costs to refrigeration, highlighting the savings potential of shelf-stable products.

Long shelf life makes buttermilk powder suitable for stockpiling in emergency food reserves and disaster relief supplies. Food manufacturers also benefit by maintaining longer production cycles without concerns over ingredient spoilage. For example,

• According to FAO, 14% of global food is lost post-harvest due to storage issues, underscoring the value of shelf-stable alternatives like buttermilk powder.

Market Restraining Factors

Increasing Health Concerns and Lactose Intolerance

Individuals with lactose intolerance are likely to experience digestive issues after consuming dairy products like buttermilk powder. This widespread condition makes dairy products less appealing to large segments of the global market. For example,

• According to the National Institutes of Health (NIH), around 68% of the global population suffers from some degree of lactose intolerance.

Consumers with lactose intolerance are opting for alternatives like lactose-free dairy products, plant-based milks, and other dairy substitutes. Rising cases of lactose intolerance have resulted in a high demand for lactose-free dairy products. This shift in consumer preference can detract from the growth of traditional dairy powders like buttermilk.

Market Growth Opportunities

Convenience and Versatility in Applications

Buttermilk powder is lightweight, compact, and does not require refrigeration, making it convenient for both consumers and commercial users. The powder form is also less messy and easier to measure accurately, making it ideal for foodservice applications and industrial production lines.

• According to a 2023 survey by the Dairy Foods Association, 67% of food manufacturers cited storage convenience as a key reason for shifting to powdered dairy products.

Buttermilk powder can be easily reconstituted with water to serve as a substitute for liquid buttermilk in recipes for baked goods, pancakes, waffles, and marinades. Its tangy flavor profile makes it a valuable ingredient in seasoning blends, sauces, and dairy-based snacks.

Buttermilk powder is often marketed as a natural and minimally processed ingredient, aligning with clean-label and health-conscious consumer preferences. It is also used in protein-enriched snack formulations, appealing to the high demand for functional foods. For example,

• A 2022 report revealed that 73% of consumers globally prefer food products with fewer and recognizable ingredients, driving demand for clean-label dairy ingredients.

Technological Innovations in Processing and Packaging

Spray drying is the most commonly used method for converting liquid buttermilk into powder. Advances in spray drying technology have led to energy-efficient systems, decreasing production costs and improving product consistency. New spray drying equipment allows better control over temperature and humidity, leading to a product with finer texture, improved solubility, and superior flavor retention. For example,

• According to the Dairy Industry Trends Report 2023, 65% of dairy manufacturers reported investing in unique spray drying systems to improve product quality and processing efficiency.

Microencapsulation techniques are being used to protect sensitive ingredients like vitamins, probiotics, and bioactive compounds in buttermilk powder. By coating buttermilk powder with a protective layer, manufacturers can improve its stability, shelf life, and functionality. This is particularly useful in the production of health supplements and fortified foods.

Innovations in packaging materials, like vacuum-sealed bags and moisture-resistant pouches, have improved the shelf life of buttermilk powder. This further helps manufacturers to maintain product freshness for longer periods. For example,

• According to the Packaging Industry Report 2023, automated packaging technologies are set to reduce costs by 10% to 15% and enhance packaging efficiency by 20% to 25%.

Competitive Landscape for the Buttermilk Powder Market

Companies in the buttermilk powder market are offering lactose-free buttermilk powder or low-fat variants to cater to the high demand for lactose-free products. They are also adopting eco-friendly practices in their production processes to meet the demand for sustainability.

Manufacturers are diversifying their product offerings by introducing flavored or fortified buttermilk powder with added nutrients to appeal to health-conscious customers. This can help companies to attract specific consumer segments seeking functional dairy products.

Businesses are partnering with food and beverage manufacturers to incorporate buttermilk powder into a wide range of products. By broadening their reach in food applications, they can access new markets and diversify their revenue sources.

Recent Industry Developments

• In September 2024, Agri-Mark, Maryland & Virginia Milk producers Cooperative Association, and Upstate Niagara Cooperative launched Integrated Dairy Ingredients (IDI). The company’s initial dairy lineup is likely to include non-fat dry milk, skim milk powder, and buttermilk powder

Buttermilk Powder Market Report Scope

Attributes	Detail
Forecast Period	2025 to 2032
Historical Data Available for	2019 to 2023
Market Analysis	US$ Billion for Value
Key Regions Covered	North America Europe East Asia South Asia and Oceania Middle East and Africa Latin America
Key Market Segments Covered	Nature End Use Distribution Channel Region
Key Companies Profiled in the Report	Hoogwegt Group Continental Dairy Facilities, LLC All American Foods Agropur DFA Ingredients Solutions Fonterra Co-operative Group Limited IPS-Ingredis Lactalis Ingredients North Cork Creameries NOW Health Group California Dairies, Inc. Dairygold Deutschland Handels GmbH Westland Milk Products Uelzena Group Valio Ltd. GFN Foods Sales Inc. Numidia BV Bempresa ACE International LLP Michigan Milk Producer Association
Report Coverage	Market Forecast and Trends Company Share Analysis Competitive Intelligence DROT Analysis Market Dynamics and Challenges Strategic Growth Initiatives
Customization and Pricing	Available upon request

Market Segmentation

By Nature

• Organic
• Conventional

By End Use

• Food and Beverage Industry
• Animal Feed Industry
• Foodservice Industry
• Retail/Households

By Distribution Channel

• Business to Business
• Business to Consumer
  • Hypermarkets/Supermarkets
  • Convenience Stores
  • Online Retail
  • Specialty Stores

By Region

• North America
• Latin America
• Europe
• East Asia
• South Asia and Oceania
• Middle East and Africa

To know more about delivery timeline for this report Contact Sales