Global Dairy Nutritional and Nutraceutical Ingredients Market Growth, Share, Size, Trends and Forecast (2025 - 2031)

• In July 2021, Glanbia introduced new dairy-based nutraceutical ingredients aimed at enhancing cognitive function and overall health.

• In February 2022, DuPont acquired a probiotic company to enhance its dairy nutritional and nutraceutical ingredients portfolio​

The global dairy nutritional and nutraceutical ingredients market is segmented by ingredient type, application, and geography. By ingredients, the market comprises dairy proteins such as whey protein, casein protein, lactulose, galacto-oligosaccharides, vitamins and minerals, colostrum, and nucleotides. Among these, whey protein (including WPI, WPH, and WPC) is the most widely used dairy ingredient, known for its high-quality protein, essential amino acids, and fast digestibility. Whey protein is commonly found in sports nutrition products, protein supplements, and functional foods. Casein protein, while also derived from milk, is known for its slow-digesting nature and is used in products designed to promote sustained amino acid release over time.

Lactulose, galacto-oligosaccharides, and other prebiotics are used extensively for digestive health, promoting gut health by stimulating the growth of beneficial bacteria in the digestive tract. Vitamin and mineral supplements, particularly calcium and vitamin D, are essential for maintaining bone health, while colostrum and nucleotides support immune function and overall cellular health. The application of dairy nutritional and nutraceutical ingredients spans multiple sectors, including functional food, infant formula, clinical nutrition, dairy products, bakery and confectionery, and personal care.

In the functional food sector, dairy ingredients are incorporated into products aimed at improving health, such as fortified milk drinks, protein bars, and smoothies. The growth of the health and wellness trend, with an emphasis on protein-rich diets and immune support, continues to drive the demand for dairy-based ingredients. In clinical nutrition, dairy protein is used to develop specialized formulas that cater to patients with dietary needs due to illness, surgery, or malnutrition. Dairy ingredients like colostrum and nucleotides are also used in medical foods and supplements for their immune-boosting properties. Additionally, dairy proteins and other ingredients are increasingly used in bakery and confectionery applications, where they contribute to the texture, flavor, and nutritional profile of products. The personal care market also leverages the benefits of dairy ingredients, especially in the form of probiotics, for skin health and hydration.

Global Dairy Nutritional and Nutraceutical Ingredients Segment Analysis

In this report, the Global Dairy Nutritional and Nutraceutical Ingredients Market has been segmented by Ingredients, Application and Geography.

Global Dairy Nutritional and Nutraceutical Ingredients Market, Segmentation by Ingredients

The Global Dairy Nutritional and Nutraceutical Ingredients Market has been segmented by Ingredients into Dairy Protein, Prebiotics, Vitamin & Minerals, Colostrum and Nucleotides.

The dairy nutritional and nutraceutical ingredients market is segmented into various types of ingredients, each catering to specific health benefits. Whey protein, one of the most widely used dairy proteins, is known for its high bioavailability, rapid digestion, and rich amino acid profile, making it a staple in sports nutrition products. It is available in various forms, including whey protein isolate (WPI), whey protein concentrate (WPC), and whey protein hydrolysate (WPH). Casein, another major protein derived from milk, is slower to digest, making it ideal for sustained amino acid release, often used in nighttime protein supplements.

Other key ingredients in this segment include prebiotics like lactulose and galacto-oligosaccharides, which improve gut health by promoting the growth of beneficial bacteria. Nucleotides, which aid in cell regeneration and immune function, are often added to clinical nutrition formulas. Colostrum, the first milk produced by mammals after giving birth, is rich in antibodies and growth factors, making it valuable in immune-boosting products. The inclusion of these diverse ingredients in various food products is driving the growth of the dairy nutritional and nutraceutical ingredients market, especially as consumers prioritize health and wellness in their diets.

Global Dairy Nutritional and Nutraceutical Ingredients Market, Segmentation by Application

The Global Dairy Nutritional and Nutraceutical Ingredients Market has been segmented by Application into Functional Food, Infant Formula & Clinical Nutrition, Dairy Products, Bakery & Confectionaries and Personal Care.

The dairy nutritional and nutraceutical ingredients market finds significant applications across functional foods, clinical nutrition, dairy products, bakery, and confectionery, as well as personal care. Functional foods are a major segment, with ingredients like whey protein and probiotics being incorporated into a wide range of products designed to support immune function, gut health, and muscle recovery. Dairy ingredients are also used extensively in clinical nutrition, where they are incorporated into specialized formulas designed for patients with dietary needs, such as those recovering from surgery, dealing with chronic illnesses, or suffering from malnutrition.

In dairy products, whey and casein proteins are commonly used to enhance the nutritional profile of milk, yogurt, and cheese. In the bakery and confectionery sector, dairy ingredients like milk powder and whey protein are added to improve texture, flavor, and nutritional content. Personal care is another application area, where dairy-based ingredients such as probiotics are used in skincare products due to their ability to nourish and hydrate the skin. These diverse applications across different sectors further contribute to the robust growth of the dairy nutritional and nutraceutical ingredients market, driven by an increasing consumer focus on health and well-being.

Global Dairy Nutritional and Nutraceutical Ingredients Market, Segmentation by Geography

In this report, the Global Dairy Nutritional and Nutraceutical Ingredients Market has been segmented by Geography into five regions; North America, Europe, Asia Pacific, Middle East and Africa and Latin America.

Global Dairy Nutritional and Nutraceutical Ingredients Market Share (%), by Geographical Region, 2024

In 2022, the North America region led the global Dairy Nutritional and Nutraceutical Ingredients Market, capturing a significant share in terms of value, followed by Europe and Asia Pacific, respectively. The global nutraceutical ingredients market is segmented into five key regions: North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. North America is expected to maintain its dominant position in the nutraceutical ingredients market in 2023, primarily due to the presence of numerous nutraceutical product manufacturers, an expanding vegan population, growing consumer awareness about nutraceutical products, and substantial investments in food processing equipment research and development.

However, Asia Pacific is projected to experience the fastest growth rate over the forecast period. This expansion is driven by several factors, including technological advancements in the food industry, the abundant availability of raw materials and large-scale production capacities, an increasing demand for dietary supplements, and a growing understanding of the health benefits offered by nutritional products. Additionally, factors such as rising disposable incomes, rapid urbanization, and increasing health and wellness trends in the nutraceutical sector are expected to contribute significantly to the region’s growth.

This report provides an in depth analysis of various factors that impact the dynamics of Global Dairy Flavors Market. These factors include; Market Drivers, Restraints and Opportunities Analysis.

Drivers, Restraints and Opportunity Analysis

Drivers:

• Rising Health Consciousness and Demand for Nutritional Foods
• Technological Advancements in Dairy Ingredient Processing

• Increasing Demand for Functional Foods and Personalized Nutrition-The increasing demand for functional foods and personalized nutrition presents a significant opportunity for the dairy nutritional and nutraceutical ingredients market. As consumers become more informed about their health and nutrition, there is a growing trend toward foods that offer specific health benefits beyond basic nutrition. This includes products that support immunity, digestive health, heart health, and muscle recovery. Dairy ingredients like whey protein, casein, and prebiotics are often incorporated into these functional foods due to their high nutritional value and health-promoting properties.

  Personalized nutrition further complements this demand, as consumers seek tailor-made solutions that meet their unique health needs. This can include customized protein supplements for athletes, specific probiotics for gut health, or fortified foods designed to address deficiencies in certain vitamins and minerals. Dairy-based ingredients play a central role in this sector due to their versatility and ability to meet a wide range of health-focused dietary requirements. With advancements in technology and a more profound understanding of individual nutritional needs, the market for functional and personalized dairy-based foods is expected to grow exponentially in the coming years.

Restraints:

• High Cost of Dairy Ingredients
• Allergies and Sensitivities to Dairy Products

• Sustainability Concerns with Dairy Production-Sustainability concerns surrounding dairy production are increasingly becoming a restraint in the dairy nutritional and nutraceutical ingredients market. Traditional dairy farming and production methods can have a significant environmental impact, contributing to greenhouse gas emissions, water usage, and land degradation. As consumers become more environmentally conscious, there is a growing demand for sustainable sourcing of dairy ingredients. Additionally, the dairy industry faces pressures to reduce its carbon footprint, improve animal welfare, and enhance resource efficiency.

  These sustainability challenges are prompting the dairy industry to innovate by adopting more sustainable farming practices, using renewable energy, and exploring alternative sources of dairy ingredients, such as plant-based alternatives. As the market for plant-based and alternative protein products expands, the dairy sector will need to address these sustainability concerns to maintain its market position and appeal to eco-conscious consumers. Companies that invest in sustainable practices, such as regenerative farming, waste reduction, and circular economies, are likely to benefit in the long term.

Opportunities:

• Expansion of Dairy-Based Ingredients in Plant-Based Products
• Rising Demand for Gut Health and Immunity-Boosting Products

• Growing Adoption of Dairy Ingredients in Personalized Nutrition-Personalized nutrition represents one of the most significant opportunities for the global dairy nutritional and nutraceutical ingredients market. As the understanding of individual nutritional needs grows, more consumers are seeking tailored dietary solutions that optimize their health and well-being. Dairy-based ingredients like whey protein, casein, and probiotics offer unique benefits that can be customized based on individual preferences and health goals. Personalized nutrition involves developing products that cater to specific needs, such as fitness-focused protein bars, immune-boosting dairy-based drinks, or gut health-enhancing dairy supplements.

  Advances in genetic testing, wearable health technology, and data analytics are enabling the growth of personalized nutrition, which will drive demand for dairy ingredients. Consumers are increasingly interested in products that support their unique needs, whether for athletic performance, weight management, digestive health, or disease prevention. By leveraging the versatility and health benefits of dairy ingredients, the market has a significant opportunity to develop innovative products that cater to this growing trend.

Key players in Global Dairy Nutritional and Nutraceutical Ingredients Market include,

• Fonterra Co-operative Group Ltd.
• Koninklijke DSM N.V.
• Arla Foods amba
• E.I. DuPont De Nemours and Co.

In this report, the profile of each market player provides following information:

• Company Overview and Product Portfolio
• Key Developments
• Financial Overview
• Strategies
• Company SWOT Analysis