Summary

As of 2020, the global powdered milk market is projected to continue its strong growth trajectory, expanding at a Compound Annual Growth Rate (CAGR) of 4.27% through 2025, primarily driven by demand in the baby food sector and the increasing urbanization trend. The United States remains the world's largest powdered milk producer, with a significant market share. In France, powdered milk accounts for 15.5% of milk production, which has shown positive momentum despite previous periods of stagnation. The French market is characterized by the dominance of large brands like Nestlé, Lactalis, and Arla, amidst a market structure featuring 53 companies with a relatively consolidated landscape.

Production volumes of powdered milk in France, however, have been on a decline. Price-wise, both skimmed and whole milk (>26% fat) powder prices increased by approximately 23% and 17% respectively. France maintains a trade surplus in powdered milk. Despite multiple past scandals involving powdered milk products, which have raised concerns among consumers, the industry continues to face stringent EU regulations aimed at ensuring product quality and safety.

The French Powdered Milk Market: Dynamics and Trends

The French market for powdered milk showcases a series of intertwined trends and demand drivers. As a dairy derivative designed for longer shelf life, powdered milk finds demand in various consumer segments, particularly among families with babies and urban dwellers seeking convenient, ready-to-consume dairy options. One significant driver influencing the demand for powdered milk is the birth rate because babies represent a substantial consumer group for this product. However, the French market faces a challenge due to the decreasing birth rate; there has been roughly a 10% decline in the number of babies born over the last decade, with between 700,000 and 720,000 babies being born in recent years. This demographic shift indicates a shrinking consumer base over time. Milk consumption habits among children further contextualize the demand for powdered milk.

There was approximately a 20% decrease in the average daily milk consumption among children aged 3 to 17 years, reflecting shifting dietary preferences that could impact the sector. Beyond childhood, the overall milk consumption trends across all age groups hint at the general sentiment towards milk and its derivatives. France observed a decline of roughly 7 to 8% in milk consumption, with the nation consuming over 2 billion liters of milk in the latter year. Factors such as the rise in popularity of plant-based milk alternatives have contributed to this decline. Direct consumption of powdered milk also mirrors this diminishing trend.

Both the value and volume of household powdered milk consumption fell between 15 and 20%, suggesting that consumers are either buying less frequently or opting for more affordable options. Production trends in France reveal that powdered milk remains a significant player in the alternative milk forms landscape, accounting for over 40% of production measured by volume. Skimmed powdered milk leads the production volumes, representing about 70% of powdered milk production.

The French market for powdered milk is undergoing increasing competition. The number of firms in the sector has increased by about 18%. The workforce within these companies also saw growth, with average company sizes nearing the mid-80s in terms of the number of employees. Powdered milk in France is subject to stringent EU regulations concerning content, composition, hygiene, additives, and labeling, ensuring a regulated market despite the periodic consumer trust challenges due to industry scandals. 

Key Players in the Global and French Powdered Milk Market

The powdered milk market, both on a global and domestic level, is characterized by the presence of several key dairy industry giants that have significant influence and a substantial market share. Nestlé, Arla, Lactalis, Sodiaal, and Laita are among the prominent companies driving trends and developments within this sector.

  • Nestlé : Nestlé stands as a global powerhouse in the powdered milk segment, maintaining a strong international presence with a diverse range of dairy products. Known for its prominent branding and extensive research and development efforts, the Swiss multinational has a solid footprint in numerous markets around the world, setting industry standards for quality and innovation in the powdered milk domain.

  • Arla : Another giant in the dairy industry, Arla is a cooperative based in Denmark with a vast European footprint. It has carved out a substantial presence in the powdered milk market with a commitment to sustainable dairy practices and a wide array of products catering to different consumer needs, including baby formula and adult nutrition.

  • Lactalis : As a French multinational dairy company, Lactalis is a prominent player in France's powdered milk landscape. Known for its vast array of dairy products, Lactalis has a notable influence on the French market, competing directly with international players with its well-established brands and extensive distribution networks.

  • Sodiaal : Sodiaal stands as one of the leading dairy cooperatives in France, with a strong commitment to local production and high-quality dairy goods. Their participation in the powdered milk sector underlines the cooperative's efforts to provide a range of products that adhere to strict quality and ethical standards, deeply rooted in French dairy tradition.

  • Laita : A lesser-known yet significant participant in the powdered milk market, Laita is a French dairy cooperative with a focus on innovation and regional production. While smaller in comparison to the likes of Lactalis and Sodiaal, Laita holds its own in the market with specialized dairy products, including its powdered milk offerings that cater to both domestic and international consumers.

The aforementioned companies represent a blend of global and French expertise in the dairy industry, with each bringing unique strengths and strategies to the powdered milk table. Their positioning in the market reflects the intricate balance of tradition, innovation, and scale required to succeed in a sector that faces intense competition, stringent regulations, and evolving consumer demands.

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Summary and extracts

1 Market summary

1.1 Definition and scope of the study

The powdered milk is a milk that has been dehydrated which consists mainly of the dry matter of milk and is used in the food industry. The powder produced can come from "whole" milk, "semi-skimmed" milk or "skimmed" milk, it can also be sweetened or contain additives such as vitamins D. While milk is composed of more than 80% water, dehydration reduces this concentration rate to only 3%.

The global market is in a period of strong growth, a trend which will continue going forward. Indeed, until 2025 the market will expand at a CAGR of 4.27%. The key triggers to this growth include the usage of powdered milk in baby food, but also that urbanisation is increasing where consumers seek a fast, cheap and durable way of consuming milk. The United States is the largest producer of powdered milk in the world.

In France, 15.5% of the milk produced is dedicated to the transformation into powdered milk. This can be compared to 35.3% for cheese for example. Several hundred thousand tonnes of milk powder are produced in France every year, whereas it takes about 10 litres of milk to produce 1kg of skimmed milk powder. The French market has regained positive momentum in the last years after a period of stagnation. Owing to some of this upheaval is the price increase which seem to have had little effect on French consumers.

The market for milk powder is closely linked to the adjacent market of milk in France. Here, France is the second largest European producer of milk after Germany.

The market for milk powder is dominated by agri-food giants and to the dairy industry which leaves little room for new entrants. In France, the sector consists of 53 companies, but the large brands (Nestlé, Lactalis, Arla, etc.) dominate sales. 

1.2 The global market is growing

  Market size powdered milk World, ****-****, in $US billion Source: alliedmarketresearch The global market for powdered milk is expected to grow at a strong pace (***), motivated by the fact that its usage in baby food remains important, but also that urbanisation is increasing, which increases demand on ready-to-consume products. Since milk ...

1.3 Domestic market

Market size of manufacturing of other milk production (***) France, ****-****, in € million Source: ****

Milk powder falls under the category "other milk production" (***) as defined by INSEE. 

In ****, the value of production was €*.** billion. This is a very small increase of a CAGR of *.**%.

Meanwhile, the market size has been volatile; in ...

1.4 International Trade

In this section we analyse France's trade of butter. In particular, we use UN Comtrade's database and the code ****** - Dairy produce; milk and creme, concentrated, not containing added sugar or other sweetening matter, in powder, granules or other solid forms, of a fat content exceeding *.*% (***). Although it is not an ...

2 Demand analysis

2.1 Demand drivers: babies and milk

Several demand triggers can be identified based on the consumer. Below, milk consumption related to babies, loyal drinkers of milk, are listed:

Birth rates: babies are avid milk consumers and thus contribute to the demand for powdered milk. Many times, parents find it convenient to purchase powdered milk to permit for ...

2.2 Demand drivers: household consumption

Adding to the previous section, although babies consumer more milk in its pure form than adults, it is important to analyse the overall consumption of milk and milk products across all age groups in France to obtain a holistic picture. With this in mind, this section looks at two metrics: Overall ...

2.3 Powdered products

Another way to look at demand for powdered milk in France is to break it down based on production, which we assume correlates almost perfectly to perceived demand. 

Production value, by category France, ****, in % Source: ****

In ****, powdered milk accounted for **.**% of production of all alternative milk forms, measured through volume, and ...

3 Market structure

3.1 The value chain of powdered milk

Source: ****

Powdered milk stems from the milk's cow. For durability and packaging reasons primarily, traditional milk is evaporated into a powder through the process described above. After this, the milk is sold in steel cans or plastic bags both on the B*B market or on the B*C market.

B*B: ...

3.2 Production volumes in decline

Production of powdered milk France, ****-****, in € million Source: ****

Production of powdered milk in France is decreasing; in ****, France produced and sold goods valued at €*.** billion. This is a decrease of some *.*% compared to ****. 

The largest share of that sales in **** was devoted to skimmed milk powder (***).

Usage of milk for ...

3.3 An increasingly competitive market

Employees and companies in the other milk products sector (***) France, ****-****, in units Source: ****

The number of firms registered under NAF code **.**D was ** in ****. This is an increase of some **.*% compared to ****, meaning the market for powdered milk in France has become more fragmented. 

The number of employees in the ...

4 Analysis of the offer

4.1 Product Overview

Milk powder is a solid product obtained by removing the water from milk, milk entirely or in part. partly skimmed, cream or a mixture of these products, and whose moisture content does not exceed not *% by weight of the finished product.

A distinction is made between the following powdered milks:- ...

4.2 Price analysis

Price overview, skimmed milk for human consumption (***) France, ****-****, in €/tons Source: ****

The graph above compares prices for powdered milk, and looks at two sub-categories: skimmed milk and whole milk (***). 

For both products, prices have increased. In ****, whole milk was priced at €*,***/ton and whole milk at €*,***/ton. This is an ...

4.3 An industry grappling with scandals

For many, powder as a derivative of milk is already controversial, and many clients prefer the natural product over its alternative form. One reason for this is the fact that the powdered milk industry has been subject to a number of scandals in the recent years.

**** saw the largest scandal ...

5 Rules and regulations

5.1 Current Regulation

The framework for dairy (***) regulation in the EU is vast and continues to be dynamic. An overview of all updates, the lastest changes and an overview of all the laws can be found here.

Regulation on milk powder is also strict.

For EU members, the following rules apply:

Commission Regulation (***) No ****/**** ...

List of charts

  • Taille de marché du lait en poudre
  • Volumes de production par zone géographique
  • Taille de marché de la fabrication d'autres produits laitiers (NAF 10.51D)
  • Nombre de naissances
  • Consommation moyenne de lait par enfant (3 à 17 ans)
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Latest news

Paysan Breton's anguish over the risk of power cuts - 05/12/2022
  • Even: Breton cooperative group specializing in dairy processing
  • 6.180 employees
  • Fresh products, fresh cream, butter, yoghurts, cheeses and spreads
  • Paysan Breton and Madame Loïk brands
Lactalis completes acquisition of Leerdammer brand - 30/09/2021
  • Lactalis has bought the Leerdammer brand
Lactalis acquires Ambrosi's cheese business - 19/03/2021
  • Lactalis has announced that it has signed an agreement to acquire the cheese activities of Ambrosi (Emmi).
  • The Emmi Group, a 25% shareholder in Ambrosi SpA, will sell its stake to Lactalis
  • The remaining 75% will be retained by the Ambrosi family group

Companies quoted in this study

This study contains a complete overview of the companies in the market, with the latest figures and news for each company. :

Arla Foods
Laïta Regilait
Even Groupe
Lactalis Groupe
Sodiaal Groupe (Coopérative)
Sill Entreprises
Nümi

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