Global Skimmed Milk Powder (SMP) Market - 2025 - 2032

Global Skimmed Milk Powder (SMP) Market reached US$ 33.71 billion in 2024 and is expected to reach US$ 51.04 billion by 2032, growing with a CAGR of 5.3% during the forecast period 2025-2032.

The global skimmed milk powder market encompasses the production, distribution and consumption of skimmed milk powder, a dairy product created by removing fat from whole milk. This process yields a powder that typically contains less than 1.5% fat while maintaining a high protein content of approximately 34% or more. Skimmed milk powder is widely utilized as an ingredient in various food applications due to its nutritional advantages, versatility and extended shelf life.

The skimmed milk powder market is experiencing rapid growth, driven by growing demand for convenience foods and health consciousness and rising demand for low-fat and calorie-conscious diets. Skimmed milk powder finds application in various sectors, including bakery products, confectionery, fermented milk products and nutritional foods.

Manufacturers are prioritizing innovation by developing fortified and specialized skimmed milk powders that meet specific dietary requirements. This includes organic varieties and products enriched with essential vitamins and minerals, which are particularly appealing to health-conscious consumers. For instance, in April 2023, Valio, launched a new infant-grade skimmed milk powder named Valio Prime SMP. This product is specifically designed for dry-blend infant milk formula (IMF) production, offering several advantages for manufacturers in the infant nutrition sector.

Dynamics

Growing Demand for Convenience Foods and Health Consciousness

The increasing demand for convenience foods is a significant driver of the global skimmed milk powder market. As lifestyles become busier, consumers are increasingly seeking quick and easy meal solutions that do not compromise on nutrition. Skimmed milk powder meets this need effectively due to its long shelf life and versatility in various applications.

Skimmed milk powder is widely utilized in ready-to-eat meals, baked goods and instant beverages, making it a staple ingredient for manufacturers catering to the convenience food segment. For instance, it enhances the nutritional profile of instant soups and sauces, appealing to consumers who prioritize quick meal preparation. Skimmed milk powder is marketed as a healthy alternative to whole milk, providing essential nutrients such as calcium and vitamins while maintaining lower caloric content. This appeal is particularly strong among health-focused consumers and those looking to manage their weight.

The Indian government marks a strategic initiative aimed at enhancing market dynamics and providing stakeholders with effective tools for risk management and price stability. For instance, in March 2024, the Government of India announced the approval for derivatives trading in 11 additional commodities, including skimmed milk powder. This decision, based on a recommendation from the Securities and Exchange Board of India (SEBI), aims to enhance the liquidity and efficiency of the commodities market.

Re-Expansion of the Food and Beverage Industry

Skimmed milk powder is widely used in various applications, including bakery products, confectionery and infant formulas. The demand for processed foods is on the rise globally, which significantly boosts the consumption of skimmed milk powder as a key ingredient. For instance, in the bakery sector, it enhances texture and nutritional value, making it a preferred choice among manufacturers. Additionally, the increasing trend of fortified foods-where nutrients are added to enhance health benefits-further propels the demand for skimmed milk powder as it can be easily integrated into various formulations.

Moreover, emerging markets present a substantial growth opportunity for the skimmed milk powder market. Rapid urbanization and rising disposable incomes in countries such as India and China are creating new consumer bases that are increasingly inclined towards dairy products. The growing middle class in these regions is expected to drive demand for nutritious food products, including skimmed milk powder. Furthermore, the introduction of innovative packaging solutions and flavored variants caters to diverse consumer preferences, making skimmed milk powder more appealing.

Competition from Alternative Dairy Products

With the increasing popularity of plant-based diets and non-dairy alternatives such as almond or soy milk gaining traction, traditional dairy products like skimmed milk powder face stiff competition. These alternatives often appeal to consumers seeking lactose-free or vegan options, which can detract from the market share of skimmed milk powder. Additionally, supply chain disruptions pose a risk to market stability. Factors such as climate change affecting dairy farming yields or geopolitical tensions impacting trade routes can lead to fluctuations in supply and prices.

Such uncertainties deter investment in production facilities or lead to increased costs that may be passed on to consumers. Furthermore, regulatory challenges related to food safety standards and labeling requirements complicate market entry for new players or innovations within existing companies. Compliance with varying regulations across different countries resource-intensive and slow down product development timelines. Some studies suggest potential links between high dairy consumption and certain health issues, which could deter some consumers from choosing skimmed milk powder regularly.

Segment Analysis

The global skimmed milk powder market is segmented based on product type, heat treatment process, grade, application, distribution channel and region.

Growing Consumer Interest in Highly Stable and Resistant to Protein Coagulation Milk

The demand for High Heat Heat-Stable (HHHS) Skimmed Milk Powder (SMP) is witnessing significant growth, particularly in regions where products like evaporated milk and condensed milk are highly consumed. HHHS SMP undergoes processing at temperatures ranging from 120°C to 140°C, making it highly stable and resistant to protein coagulation during heat treatment. This property is essential for producing shelf-stable dairy products that require extensive heating without compromising on flavor and texture.

One of the main drivers of demand for HHHS SMP is its increasing use in the production of long shelf-life products such as baby food, bakery products and dairy beverages, especially in regions like Asia, Middle East and Latin America. These areas show a steady rise in demand for dairy products, with evaporated milk consumption growing at an average rate of 2% annually. Furthermore, HHHS SMP helps address the need for heat-treated dairy products in areas with limited milk supply or where longer shelf life is necessary to prevent spoilage.

The growing preference for heat-treated, stable products that can be stored for extended periods is another contributing factor. In countries where milk production is not consistent year-round, the use of HHHS SMP allows manufacturers to produce stable, ready-to-use dairy products that cater to diverse consumer needs. This trend is expected to continue as consumer demand for convenience, nutrition and extended shelf life remains high.

Geographical Penetration

Rising Health Consciousness Population in Drive the North America Market

The North American skimmed milk powder (SMP) market is experiencing sustained demand, driven by various factors such as rising health consciousness, the growing food and beverage sector and its extensive use in bakery, confectionery and dairy applications. U.S., a key producer in North America, saw an increase in skimmed milk powder production, aligning with global demand. For instance, the USDA reported that the U.S. produced over 700,000 metric tons of SMP in 2023. This was facilitated by a steady supply of raw milk and an emphasis on meeting domestic and international needs.

According to a recent report from the U.S. Department of Agriculture (USDA) Global Agricultural Information Network (GAIN), the United States is expected to increase its production of skim milk powder by 11% to 1.30 million tons in 2024 due to increased milk production and a surplus of skim milk for drying. As the difference between U.S. and EU prices closes to parity, the competitive environment is anticipated to support U.S. exports in 2024.

The price of skim milk powder in the EU was US$ 1.36 per pound FOB in November 2023, whilst the price of Western low-medium heat NDM FOB in the US was US$ 1.21 per pound. The North American market experienced stable domestic consumption driven by its use in processed foods, infant formula and skimmed milk powder products. Additionally, the health and wellness trend is increasing demand for high-protein and low-fat dairy options, further boosting SMP sales.

Competitive Landscape

The major global players in the market include Fonterra Co-Operative Group Limited, Hiroland, Nestle S.A., Lactalis Group, Arla Foods amba, Dairy Farmers of America, Inc., Danone SA, Gujarat Cooperative Milk Marketing Federation (Amul), Dana Dairy Group and Polmlek.

Value Chain Analysis

Value chain of skimmed milk powder market starts with raw material sourcing, where high-quality milk is obtained from dairy farms, ensuring that product quality impacts nutritional profile and safety. Next, processing involves pasteurization, separation and drying to produce skimmed milk powder, with strict quality control measures in place.

The processed powder is then packaged in moisture-proof materials to enhance shelf life and branding. Following this, distribution occurs through various channels, including wholesalers, retailers and e-commerce platforms, broadening consumer access. Effective marketing and sales strategies emphasize the health benefits and versatility of skimmed milk powder to attract health-conscious consumers.

Scientific Analysis

SMP is an excellent source of essential nutrients, including high-quality protein, calcium, vitamins and minerals. It typically contains around 34-37% protein per 100 grams, making it beneficial for muscle maintenance and growth. Additionally, SMP provides significant amounts of calcium (approximately 1,257 mg per 100 grams), which is crucial for bone health. Its low-fat content (typically less than 0.5 grams per serving) makes it an attractive option for health-conscious consumers seeking to reduce calorie intake while still enjoying the benefits of dairy.

The bioavailability of nutrients in SMP is enhanced due to its processing methods, which facilitate the absorption of essential vitamins and minerals. Advances in food technology are likely to further improve nutrient delivery mechanisms, ensuring that consumers receive maximum health benefits from SMP. The SMP market is witnessing innovation in product formats, including ready-to-drink beverages, fortified powders for specific age groups (like infants or seniors) and functional foods designed for athletes. The developments are supported by scientific research that identifies consumer trends and nutritional needs, enabling manufacturers to create products that meet diverse consumer demands.

Recent Developments

• In March 2024, the A2 Milk Company (a2MC) has reiterated its commitment to returning its Southland-based Mataura Valley Milk (MVM) plant to profitability. As part of its strategic focus, a2MC is working to enhance operational efficiency and optimize the production capacity of its MVM facility, signaling a strong emphasis on sustainable growth in the SMP sector.
• In March 2024, Indian government permitted derivatives trading in 11 new commodities, including SMP, effective. The Securities and Exchange Board of India (SEBI) recommended these changes, which were swiftly implemented upon notification by the Finance Ministry. This initiative is aimed at helping businesses, farmers, producers and consumers manage price risks more effectively.
• In January 2024, in the European Union, SMP production is forecast to dip to just under 1.5 million tons in 2024, reflecting a 3% decline from the previous year. This shift underscores the evolving priorities in the European dairy sector amidst fluctuating global market dynamics, according to the US Department of Agriculture (USDA) Global Foreign Agricultural Service (FAS).

Why Purchase the Report?

• To visualize the global skimmed milk powder (SMP) market segmentation based on product type, heat treatment process, grade, application, distribution channel and region.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points at the skimmed milk powder (SMP) market level for all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as excel consisting of key products of all the major players.

The global skimmed milk powder (SMP) market report would provide approximately 78 tables, 79 figures and 215 pages.

Target Audience 2024

• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies