The skim milk powder (SMP) market is expected to witness steady-growth throughout the course of 2025 to 2035 on map of it expanding application in bakery, confectionery, dairy, beverages, and infant nutrition.
Skim milk powder produced from fresh milk by removing fat and moisture is versatile, containing a lot of protein, relatively inexpensive and easy to transport, making it a common ingredient in processed foods, especially where cold chain infrastructure is weak.
Growing end-use industries and rising consumer demand for low-fat and high-protein products, as well as an increasing use of SMP in developing regions due to a cost-effective substitute for dairy products, is propelling the market. Nonfat dry milk is also a common ingredient in government school feeding programs and emergency aid.
Key Market Metrics
| Metric | Value |
|---|---|
| Market Size in 2025 | USD 32,844.7 million |
| Projected Market Size in 2035 | USD 53,691.2 million |
| CAGR (2025 to 2035) | 5.1% |
In addition, its applications in sports nutrition, powdered milk production, and as a filler in the production of a wide variety of meats are expanding its demand base. Global base salaries above market size is expected to grow at a CAGR of 5.1% from USD 32,844.7 million in 2025 to approximately USD 53,691.2 million in 2035.
The SMP demand to supply ratio is nothing short of compelling, particularly in North America where there is huge scale dairy, significant processing infrastructure and foodservice / bakery needs. The United States heavily employs skim milk powder in dry mixes, bakery fillings and processed cheese.
Government procurement through food assistance programs and exports to Latin America and Asia-Pacific continue to drive stability in the market. North America In addition, regional sports nutrition brands are using SMP as a base for protein-fortified powders and gels.
It has a strong dairy heritage, the ability to export dairy at scale, and a wide application in bakery and dairy blends. Germany, France and the Netherlands export SMP to world markets, where it then works its way into premium chocolates, desserts and dairy drinks.
Subsidies from the EU Common Agricultural Policy (CAP) for skim milk powder production are one of the factors life the region in times of price turbulence. Additionally, the use of SMP as a protein source in infant nutrition formulations is growing in cues.
The Asia-Pacific region is projected to be the fastest growing market owing to increasing dairy consumption, expanding processed food industries, and nutritional initiatives in China, India, Indonesia, Vietnam, and others. SMP is widely employed China in instant formula, coffee creamers, and yogurt drinks.
Dairy processors in India are incorporating SMP into reconstituted milk and indigenous sweets to decrease dependence on fresh milk in off-seasons. SMP is included in government nutritional programs (for example school feeding and maternal health kits) in Southeast Asia.
Volatile milk prices, import/export restrictions, and lactose intolerance curb demand.
The SMP market reacts to changes in raw milk price, as those also affect production cost and international competitiveness. Geopolitical developments, as well as changes in trade policy, can impact export volumes and access to key markets.
Even in sections of the world where people are fond of milk products, such as India, the demand for SMP may be limited due to widespread lactose intolerance, especially amongst adults, in Asia and Africa.Overproduction in large dairy-exporting countries other times results in price dumping, which hurts local producers in smaller economies. In addition, difficulty for storage and reconstitution in high-humidity countries can influence product stability and acceptance.
Functional food innovation, school meal programs, and non-dairy applications drive growth.
SMP plays a role here due to its clean label and high-protein profile as opportunities abound in both the functional food and nutraceutical sectors. Demand for SMP in low-fat yogurts, smoothies and meal replacement powders is being driven by health-conscious consumers.
In particular, government contracts for nutrition schemes in developing nations provide a stable albeit long-term market. In industrial food aspect,SMP acts as a cheap binder, extender and emulsifier. In addition, hybrid drinks that blend plant sources and dairy derivatives are also looking at SMP to enhance protein content and improve mouthfeel.
The SMP market was driven by pandemic-induced supply chain barriers and an increase in consumer demand for shelf-stable and high-protein foods. SMP sales skyrocketed during lockdowns as consumers hoarded durable necessities. Export restrictions also applied pressure on global supply chains temporarily especially in the EU and the area of Oceania.
In the future the focus of the market will move towards specialty SMP blends designed specifically for infant formula, clinical nutrition and high-protein snack products. Digital traceability, sustainability labeling, and farmer-to-formulator sourcing models will take off. Innovation with plant-dairy hybrid products will evaluate SMP as texture and nutrient enhancer in new formats.
Market Shifts: A Comparative Analysis 2020 to 2024 vs. 2025 to 2035
| Market Shift | 2020 to 2024 Trends |
|---|---|
| Regulatory Landscape | Focus on food safety and export standards |
| Consumer Trends | Preference for protein-rich shelf-stable foods |
| Industry Adoption | Dominated by bakery, dairy mixes, and food aid |
| Supply Chain and Sourcing | Disruptions due to trade barriers and labor shortages |
| Market Competition | Led by dairy co-ops and F&B giants |
| Market Growth Drivers | Emergency food demand and baking boom |
| Sustainability and Impact | Minimal focus beyond shelf stability |
| Smart Technology Integration | Traceability and production monitoring |
| Sensorial Innovation | Use in reconstituted milk and desserts |
| Market Shift | 2025 to 2035 Projections |
|---|---|
| Regulatory Landscape | Sustainability metrics, carbon labeling, and nutritional fortification |
| Consumer Trends | Growth in low-fat, high-protein snacks and lactose-reduced variants |
| Industry Adoption | Expansion into sports nutrition, hybrid beverages, and geriatric care |
| Supply Chain and Sourcing | Digitized milk sourcing and regional buffer stock programs |
| Market Competition | Entry of clean-label, specialty nutrition, and APAC-based producers |
| Market Growth Drivers | Functional food trends, school feeding schemes, and personalized nutrition |
| Sustainability and Impact | Climate-smart dairy sourcing and net-zero production facilities |
| Smart Technology Integration | Blockchain supply chains and AI-optimized reconstitution |
| Sensorial Innovation | Integration in creamy textures, non-dairy blends, and flavor masking |
The USA market for skim milk powder is expanding at a steady rate owing to consistent demand from food manufacturers, bakeries, and nutrition brands. Skimmed milk powder is widely used in protein bars, baby milk and ready-mixed drinks.
The USA is one of the top dairy exporters in the world, something aided by several USDA-backed trade policies. Increase in various high-protein, low-fat meal replacement and medical nutrition sectors will help domestic demand grow as well. Investing in spray drying technologies to enhance solubility and shelf life.
| Country | CAGR (2025 to 2035) |
|---|---|
| United States | 5.4% |
United Kingdom
In the UK market, demand for skim milk powder increases in processed food, confectionery and sports nutrition applications. Domestic United Kingdom sourced skimmed milk solids processing has increased since post-Brexit dairy trade adjustments In the UK, food manufacturers favor skim milk powder with its shelf stability and nutritional profile for clean-label and reduced-fat formulations.
In particular, consumers are increasingly turning to meal replacement shakes and protein-fortified snacks, fueling ongoing widespread market growth, especially in healthy and senior populations.
| Country | CAGR (2025 to 2035) |
|---|---|
| United Kingdom | 4.9% |
European Union
A large part of the EU skim milk powder market is driven by a strong dairy processing industry and export demand (more so than milk powder consumption within Europe) with particular demand coming from Asia and Africa. Countries Germany, France, and Ireland in particular are significant producers that rely upon Common Agricultural Policy (CAP) subsidies to remain competitive within the EU.
Skim milk powder is a popular ingredient in bakery, processed cheese, chocolate and reconstituted milk. Regulations like those found in the EU regarding food safety and clean labeling continue to shape product quality and formulation. Low-temperature drying Patented low-temperature drying technologies are also being adopted to keep protein integrity intact while consuming less energy.
| Country | CAGR (2025 to 2035) |
|---|---|
| European Union | 5.1% |
Japan
Growth in the Japan skim milk powder market is driven by the demand for food from convenience food manufacturers and the functional food market. Instant noodles, pastries, and meal replacement products use skim milk powder. Dairy is the core driver although local production remains low with heavy reliance on imports forming partnerships with exporters from the USA, EU, and Australia.
Products enriched with vitamins and minerals are most favored among Japanese consumers, especially regarding elderly nutrition fortified and calcium-rich formulations. Domestic food businesses are innovating packaging formats such as powder packaging in portion-controlled, single-serve formats, which are aligned to meet urban lifestyle trends.
| Country | CAGR (2025 to 2035) |
|---|---|
| Japan | 4.7% |
South Korea
South Korea’s market for skim milk powder is expanding as its use in infant formula, bakery products and high-protein drinks are on the rise. Imports have become an essential channel of supply, as the domestic dairy output in the country is limited; and the government has been ensuring their safety through stringent inspection protocols.
Growing awareness around weight maintenance and protein supplementation among younger consumers is fueling demand. Domestic processors are utilizing skim milk powder in functional and fortified beverages aimed at the elderly and sports enthusiasts. Growth is also driven by increasing online and direct-to-consumer distribution.
| Country | CAGR (2025 to 2035) |
|---|---|
| South Korea | 5.3% |
With food manufacturers looking to SMP for stable milk solids, shelf-stable dairy bases and economical protein enrichment, the skim milk powder (SMP) market is on the rise. Surplus milk powder (SMP) is produced by evaporating and spray-drying skimmed milk, and is commonly used as an ingredient in dairy, bakery and processed foods.
In terms of product category and application segments, low-heat SMP and dairy products are estimated to account for the major share in the global market, by virtue of being retained on functional proteins, clean flavor profile, and high solubility in liquid dairy systems. Segmentation enables a vital performance for milk recombining, yogurt thickening and cultured dairy base formulation, especially in areas with cold chain constraints or milk supply imbalance.
With rising demand for functional food and global dairy exports especially to Southeast Asia, Africa, and the Middle East gaps in the supply of milk are being bridged by low-heat SMPs at the global level while supporting manufacturing standardization across geographies expands dairy-focused applications.
Low-heat SMP dominates product preference due to high-casein retention, protein functionality, and optimal performance in cultured dairy
| Product Type | Market Share (2025) |
|---|---|
| Low-Heat SMP | 52.8% |
The product type segment is further categorized into low-heat skim milk powder, high-heat skim milk powder, and others, wherein low-heat skim milk powder is anticipated to dominate as it is rich in undenatured proteins, extending the proteins & caseins, widely used in yogurt, cheese & recombined milk formulations. Processed under very low heat conditions during drying, this grade of SMP provides superior emulsification, viscosity control, and fermentation properties.
In addition, low-heat SMP is used by manufacturers to facilitate the optimal rehydration of milk powder, enhance the texture of gels in dairy desserts, and promote pH stability in cultured products. The consistent composition and protein quality also contributes to lower syneresis in yogurt and improved curd firmness in cheese.
Because low-heat SMP does not disturb flavor, color or nutritional density, it’s the ideal functional base for dairy processors hunting for protein-enrichment and clean-label dairy alternatives. This is still the most popular option for applications demanding native protein functionality and standardised casein: whey ratios.
Dairy product applications lead market use through reconstitution, protein enrichment, and formulation consistency across liquid and cultured segments
| Application | Market Share (2025) |
|---|---|
| Dairy Products | 57.3% |
The primary usage of SMP is in reconstituted milk, yogurt, cheese, flavor milk drinks, and popular based dairy products, among others, accounts for a major share in the application. SMP serves as a cost-effective, shelf-stable substitute for fresh milk with uniform solids control vital for both industrial dairy production and the international dairy trade.
Processors adopt SMP to keep a consistent fat-to-solids ratio in fluid milk, increase mouthfeel in skim and low-fat varieties, and provide improved heat stability for formulations in UHT milk applications. It also provides a clean taste and smooth texture in probiotic yogurt, lassi, and dairy desserts, serving as a foundational source of protein.
SMP helps enhance the availability of dairy products in markets that have little access to fresh milk or where refrigeration is a challenge, while also providing food safety and nutrient density. This is critical in school milk programmes, dairy co-operatives and humanitarian aid applications.
However, dairy product applications remain the most prominent segment for SMP, owing to direct rehydration requirements, performance in the functional dairy matrix in order fulfilment as well as for maintaining supply in the global milk supply chain.
The skimmed milk powder (SMP) market is expected to undergo steady growth owing to the rise in demand from bakery, confectionery and dairy industry coupled with nutrition programs and food security policies backed by the government. SMP is a dehydrated milk product commonly found on shelves due to its lengthy shelf life, easy to transport, and high protein content.
It has applications in infant formula, ready-to-drink beverages, processed foods and food aid. Global SMP Trade Remains Strong and Growth AJG is Led by Developing Economies Revamping of spray drying efficiency, protein-standardized blends, and greater emphasis on Codex and WTO dairy export norms compliance are factors driving the manufacturers [Source: FAO].
Market Share Analysis by Key Players & SMP Providers
| Company Name | Estimated Market Share (%) |
|---|---|
| Fonterra Co-operative Group | 14-17% |
| Dairy Farmers of America | 11-14% |
| Arla Foods amba | 9-12% |
| Nestlé S.A. | 7-10% |
| Saputo Inc. | 6-9% |
| Other Providers | 38-45% |
| Company Name | Key Offerings/Activities |
|---|---|
| Fonterra Co-operative Group | In 2024, launched instantized SMP with improved solubility for RTD drinks; in 2025, expanded low-heat SMP production for infant nutrition. |
| Dairy Farmers of America | In 2024, upgraded spray dryers for high-protein SMP output; in 2025, launched certified non-GMO skim milk powder for foodservice. |
| Arla Foods amba | In 2024, introduced SMP blends for bakery and cereal producers; in 2025, scaled organic SMP supply chain across Europe and MENA. |
| Nestlé S.A. | In 2024, launched fortified SMP for school feeding programs; in 2025, developed sustainable SMP packaging using recyclable pouches. |
| Saputo Inc. | In 2024, diversified SMP portfolio for dairy processors and chocolate manufacturers; in 2025, optimized SMP for reconstitution in hot climates. |
Key Market Insights
Fonterra Co-operative Group (14-17%)
Fonterra remains the world’s largest exporter of skim milk powder, supplying over 130 countries. In 2024, the company released instantized SMP for faster dissolution in ready-to-drink beverages and rehydrated dairy formulations. In 2025, it expanded its low-heat SMP output to cater to infant nutrition manufacturers and clinical diet food producers. Fonterra’s technical leadership and robust trade infrastructure anchor its dominance in Asia and the Middle East.
Dairy Farmers of America (11-14%)
DFA has significantly strengthened its manufacturing footprint for domestic and export-grade SMP. In 2024, it modernized its drying facilities to produce high-protein skim milk powder with consistent flow properties. In 2025, DFA introduced non-GMO SMP certified for institutional foodservice, catering to USA and European demand for transparent sourcing. DFA’s member-based cooperative model supports farmer income while meeting global dairy trade standards.
Arla Foods amba (9-12%)
Arla has expanded its skim milk powder operations with a focus on specialty and sustainable applications. In 2024, it introduced functional SMP blends tailored for bakery mixes, cereal coatings, and instant porridges. In 2025, Arla scaled its organic SMP distribution to serve growing markets in Europe and MENA, leveraging traceable supply chains and sustainable farming practices. Its diversified portfolio supports regional nutrition and food security programs.
Nestlé S.A. (7-10%)
Nestlé is focused on nutrition-led SMP product development for emerging markets. In 2024, it introduced fortified SMP fortified with vitamins and minerals for school feeding programs in Africa and Southeast Asia. In 2025, the company launched lightweight, recyclable SMP pouches, which helped cut down on packaging waste, in support of the company’s global sustainability goals. Nestlé’s wide scope and strong R&D focus make it a strategic supplier relative to humanitarian and public health nutrition programs.
Saputo Inc. (6-9%)
Saputo supports value-added SMP use in confectionery and rehydrated dairy segments. In 2024, it diversified SMP offerings to meet quality and flow consistency for chocolate manufacturers. In 2025, Saputo optimized its SMP grades for easier mixing and reconstitution in warm climates, targeting Latin America, Africa, and Southeast Asia. Its dual emphasis on functional performance and climate suitability enhances its global competitiveness.
Other Key Players (38-45% Combined)
Numerous regional dairy cooperatives and powder blenders meet local and export demand across the globe. These include:
The overall market size for the skim milk powder market was approximately USD 32,844.7 million in 2025.
The skim milk powder market is expected to reach approximately USD 53,691.2 million by 2035.
The demand for skim milk powder is rising due to increasing health consciousness among consumers.
The top 5 countries driving the development of the skim milk powder market are the United States, China, India, Germany, and Japan.
Low-heat skim milk powder and its application in dairy product formulations are expected to command significant shares over the assessment period.
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