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Yogurt Powder Market

The market for Yogurt Powder was estimated at $902 million in 2025; it is anticipated to increase to $1.28 billion by 2030, with projections indicating growth to around $1.83 billion by 2035.

Report ID:DS1901119
Author:Debadatta Patel - Senior Consultant
Published Date:
Datatree
Food & Beverage
Packaged & Processed F&B
Yogurt Powder
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Report Summary
Market Data
Methodology
Table of Contents

Global Yogurt Powder Market Outlook

Revenue, 2025

$902M

Forecast, 2035

$1.83B

CAGR, 2026 - 2035

7.3%

The Yogurt Powder industry revenue is expected to be around $902.2 million in 2026 and expected to showcase growth with 7.3% CAGR between 2026 and 2035. This projection underscores how Yogurt Powder has become a strategically important dairy ingredient for food manufacturers and the foodservice ecosystem, as its extended shelf life, storage efficiency, and consistent functionality reduce cold-chain dependency and waste. Demand is further reinforced by rapid menu innovation in quick-service and casual dining formats, where HoReCa and industrial end-user segments together account for 75.8% of overall consumption, leveraging Yogurt Powder in sauces, beverages, desserts, and value-added meal components. Within the product landscape, the Whole Product Type segment remains the core revenue engine, having dominated the Yogurt Powder industry with sales of $395.15 million in 2025, reflecting strong preference for authentic yogurt taste, natural positioning, and ease of integration into large-scale production lines. These structural advantages, combined with rising consumer interest in protein-rich and better-for-you offerings, are sustaining the ongoing relevance of Yogurt Powder in both mature and emerging markets.

Yogurt Powder is a versatile, shelf-stable form of fermented dairy that is typically produced via spray-drying or similar technologies, preserving characteristic tangy flavor, creamy mouthfeel, and essential nutrients while offering superior handling and storage benefits. As a multifunctional dairy ingredient, it is widely used in functional food applications, including smoothies, high-protein snacks, and breakfast products, while also serving as a key component in bakery applications, confectionery fillings, savory seasonings, and ready-to-drink beverages that demand a stable, real-yogurt profile. In HoReCa kitchens and industrial food processing, formulators rely on Yogurt Powder for dosage precision, batch-to-batch consistency, and compatibility with automated mixing, dry blending, and extrusion systems. Recent demand is being propelled by clean label formulations, the development of fortified and specialized blends for nutraceutical products, and innovation around low-sugar, high-protein, and culturally inspired flavors, positioning Yogurt Powder as a critical enabler of next-generation dairy-based and hybrid food solutions.

Yogurt Powder market outlook with forecast trends, drivers, opportunities, supply chain, and competition 2025-2035
Yogurt Powder Market Outlook

Market Key Insights

  • The Yogurt Powder market is projected to grow from $902.2 million in 2025 to $1.83 billion in 2035. This represents a CAGR of 7.3%, reflecting rising demand across Bakery and Confectionery Products, Nutritional Supplements, and Cosmetic and Personal Care.

  • Kerry Group plc, Glanbia plc, and Epi Ingrédients are among the leading players in this market, shaping its competitive landscape.

  • U.S. and China are the top markets within the Yogurt Powder market and are expected to observe the growth CAGR of 4.7% to 7.0% between 2025 and 2030.

  • Emerging markets including Brazil, UAE and South Africa are expected to observe highest growth with CAGR ranging between 8.4% to 10.1%.

  • Transition like Shift Towards Healthy Eating is expected to add $93 million to the Yogurt Powder market growth by 2030.

  • The Yogurt Powder market is set to add $923 million between 2025 and 2035, with manufacturer targeting Industrial & Household Application projected to gain a larger market share.

  • With

    the surging demand for dairy alternatives, and

    The Rising Health Consciousness, Yogurt Powder market to expand 102% between 2025 and 2035.

yogurt powder market size with pie charts of major and emerging country share, CAGR, trends for 2025 and 2032
Yogurt Powder - Country Share Analysis

Opportunities in the Yogurt Powder

Rising demand for convenient, high-protein snacks is also creating strong potential for Yogurt Powder as a versatile dairy ingredient in the North American sports nutrition market. Brands can use skimmed Yogurt Powder for bar coatings, ready-to-drink mixes, and protein clusters, combining low fat with creamy flavor and probiotic fortification. Globally, skimmed revenue is projected to rise from $$295.01 million in 2025 to $441.55 million by 2030, the fastest 8.4% CAGR, with North American applications expected to outpace average growth rates.

Growth Opportunities in North America and Asia-Pacific

In North America, Yogurt Powder demand is increasingly driven by industrial end-users, as food and beverage manufacturers integrate powdered yogurt into bakery applications, ready-to-drink beverages, confectionery fillings, and sports nutrition products to enhance protein, texture, and probiotic positioning. While HoReCa and household segments are expanding in line with the global mid- to high-single-digit CAGR profile for Yogurt Powder, the industrial channel holds the highest strategic relevance due to its scale, R&D intensity, and preference for functional dairy ingredients and clean-label formulations. Competitive dynamics are shaped by established dairy ingredient suppliers and regional specialty processors of powdered yogurt and fermented dairy powder, with growing pressure from private labels focusing on cost-optimized blends; this encourages differentiation through high-solubility, low-sugar, and high-protein Yogurt Powder tailored to specific processing conditions. Key regional drivers include the shift toward high-protein snacks, reformulation away from artificial additives, and the need for stable, logistics-friendly ingredients that support e-commerce and foodservice distribution, creating top opportunities in co-developed instant yogurt mix concepts, value-added blends with fibers or probiotics, and contract manufacturing partnerships with branded consumer and foodservice accounts.
In Asia-Pacific, HoReCa emerges as the most influential end-user for Yogurt Powder, as quick-service restaurants, beverage chains, and dessert cafés increasingly use powdered yogurt and instant yogurt mix formats in smoothies, bubble teas, soft-serve, and bakery toppings to manage consistency and shelf life under diverse climate conditions. Industrial utilization is accelerating but remains secondary, with local food processors gradually integrating Yogurt Powder and other functional dairy ingredients into snacks, bakery, and fortified beverages to align with rising demand for convenient, aspirational dairy-based products, while household uptake grows via small-pack, affordable formats. Competition is more fragmented than in mature markets, with strong local dairy brands and regional blenders competing largely on price, which opens opportunities for global and regional players to differentiate with technically advanced Yogurt Powder solutions offering superior dispersibility, heat stability, and flavor customization for localized tastes. Core growth drivers include rapid urbanization, expanding middle-class consumption, the proliferation of café culture, and rising health awareness around protein and gut health, making Asia-Pacific a priority region for investment in local production or toll-drying capacity, targeted HoReCa partnerships, and the development of region-specific Yogurt Powder portfolios optimized for cold and hot beverage systems, bakery applications, and on-the-go formats.

Market Dynamics and Supply Chain

01

Driver: Rising Demand for Functional Foods and Increased Popularity of Protein‑Rich Ingredients

The yogurt powder market is also being driven by the growing consumer preference for functional foods and the rising interest in protein‑rich ingredients. Functional foods, which provide additional health benefits beyond basic nutrition, have also increased the demand for yogurt powder in products such as fortified bakery items, meal‑replacement bars, and probiotic beverages. Yogurt powder delivers probiotics, calcium, and bioactive compounds that enhance gut health and immunity. Separately, the popularity of protein‑enriched diets among athletes, fitness enthusiasts, and aging populations has also led to widespread use of yogurt powder in high-protein shakes, smoothies, and nutritional supplements. Its concentrated protein content, ease of incorporation, and shelf stability make it an ideal ingredient for formulators seeking clean-label, nutrient-dense alternatives. Together, these factors drive innovation in yogurt powder formulations, with manufacturers developing specialty powders such as high-protein isolates, probiotic blends, and fruit-infused variants to meet diverse consumer demands in global markets.
Technological innovations in freeze-drying, spray-drying, and microencapsulation have also significantly improved the quality, shelf life, and functional properties of yogurt powder. These advancements allow manufacturers to retain probiotics, enzymes, flavor, and texture more effectively than traditional drying methods. Enhanced stability ensures incorporation into a wide range of applications, including bakery products, nutritional bars, and cosmetic formulations, without degradation of active ingredients. Improved powder dispersibility and solubility also facilitate seamless integration into beverages and supplement formulations. Consequently, these technological trends expand yogurt powder’s versatility, enabling producers to meet rising consumer demand for convenient, functional, and clean-label dairy-based ingredients.
02

Restraint: High Production Complexity and Drying Costs Limit Profitability and Scale

One major restraint for the yogurt powder market is the high cost and complexity of production, especially drying technologies like spray‑drying and freeze‑drying that preserve probiotics and nutritional integrity. These processes require significant capital investment, energy, and quality controls, which increase manufacturing costs passed on to buyers. For example, premium probiotic yogurt powders are priced noticeably higher than regular dairy powders, making them less competitive in cost‑sensitive segments such as value snacks or mainstream bakery. Higher production costs restrict smaller manufacturers from scaling operations, slowing overall market expansion and reducing price competitiveness against alternatives like whey or soy protein powders.
03

Opportunity: Premium whole yogurt powder upgrades bakery fillings in European foodservice and Clean-label yogurt powder powers functional beverages in Asia-Pacific convenience channels

Rising premiumization in European bakery applications and foodservice desserts is boosting demand for indulgent yet perceived-natural ingredients, positioning whole Yogurt Powder as a key differentiator. Chefs and industrial bakers can deploy whole Yogurt Powder in creamy fillings, frostings, instant desserts, and frozen bakery items, achieving stable texture without refrigerated storage. Globally, whole Yogurt Powder revenues are projected to increase from $$395.15 million in 2025 to $536.32 million by 2030 at 6.3% CAGR, with Europe expected to drive the premium value share.
Asia-Pacific consumers are rapidly shifting toward functional beverages that deliver digestion, immunity, and energy benefits in portable formats, opening white space for Yogurt Powder. Semi-skimmed Yogurt Powder provides balanced creaminess, moderate calories, and strong compatibility with fruit flavors, ideal for shelf-stable powdered yogurt sachets sold through convenience stores and online platforms. Globally, semi-skimmed revenues are expected to climb from $$212.01 million in 2025 to $305.30 million by 2030, growing at 7.57% CAGR, with Asia-Pacific beverage applications leading incremental demand.
04

Challenge: Limited Consumer Awareness and Misperceptions About Functional Benefits Hamper Demand Growth

Another significant restraint is limited consumer understanding and misperceptions about yogurt powder’s functional advantages, including probiotics and digestive benefits. Many end‑users still favor fresh yogurt or liquid dairy, perceiving powdered forms as less nutritious or processed. This mindset reduces trial and repeat purchases in categories like nutritional supplements and snacks. For instance, despite its shelf‑stability and convenience, yogurt powder often sees lower uptake in mainstream retail compared with fresh dairy or other protein powders. These perception barriers limit demand growth, particularly among older demographics and health‑focused consumers who drive functional food markets, thereby impacting revenue and slowing broader adoption.

Supply Chain Landscape

1

Dairy Raw Materials

FonterraArla FoodsDairy Farmers of America
2

Yogurt Production

Kerry Group plcGlanbia plcProlactal
3

Yogurt Powder Manufacturing

Epi IngrédientsCP IngredientsKerry Group plc
4

End-Use Applications

Food & BeverageNutritional SupplementsInstant Beverages
Yogurt Powder - Supply Chain

Use Cases of Yogurt Powder in Bakery & Confectionery Products

Bakery and Confectionery Products : In bakery and confectionery products, freeze‑dried and spray‑dried yogurt powder is commonly used to introduce authentic dairy flavor, tanginess, and nutritional value into a range of items including cakes, cookies, biscuits, pastries, and sweet snacks. The powder form adds natural yogurt taste without moisture, preserving texture and structure in baked goods while enhancing browning and crust development. It also strengthens the protein and calcium content, appealing to health‑oriented consumers. Leading ingredient suppliers like Fonterra, Nestlé, Arla Foods Ingredients, and Danone offer standardized yogurt powders tailored for consistent performance and easy formulation, enabling product developers to innovate with fruit‑infused yogurts, yogurt chips, and flavor enhancers that differentiate bakery assortments in competitive retail markets.
Nutritional Supplements : In the nutritional supplements category, high‑protein yogurt powders, often fortified with probiotics and added vitamins, are used in meal‑replacement shakes, smoothie blends, sports nutrition formulas, and shelf‑stable food bars. These powders deliver the digestive benefits of yogurt cultures plus protein for muscle maintenance, immune support, and gut health, making them popular among athletes, older adults, and wellness enthusiasts. Brands like Glanbia Nutritionals, Kerry Group, and Arctic Nutrition provide premium yogurt protein concentrates and isolates for formulators seeking clean‑label, functional ingredients that meet consumer demand for digestive wellness, satiety, and metabolic benefits without perishable refrigeration.
Cosmetic and Personal Care : In cosmetics and personal care, ultra‑fine yogurt powder is incorporated into face masks, creams, body scrubs, and hair care products for its lactic acid and probiotic content that support gentle exfoliation, hydration, and microbiome balance. Cosmetic formulators value yogurt powder for its creamy texture and natural conditioning properties, which help soothe and nourish skin while enhancing product sensory appeal. Major ingredient innovators such as Croda International, BASF Care Creations, and Evonik Industries supply stabilized yogurt‑derived complexes optimized for skin compatibility, enabling clean‑label beauty products that resonate with consumers seeking natural, functional skincare solutions targeting hydration, radiance, and barrier support.

Recent Developments

The yogurt powder market is advancing as high‑protein and probiotic functional ingredients gain prominence across bakery, nutrition, and wellness segments. A key trend is the integration of advanced drying technologies like spray‑drying that improve texture retention, flavor stability, and nutrient preservation, enabling seamless use in ready‑to‑mix beverages and fortified snacks. Manufacturers and ingredient suppliers are also focusing on clean‑label, gut‑health positioning to meet demand from health‑conscious consumers seeking convenient dairy alternatives with digestive benefits.

January 2025 : Kerry Group plc completed Phase 1 of selling its Kerry Dairy Ireland business to Kerry Co‑Operative Creameries Ltd, enabling Kerry to concentrate on taste, nutrition, and functional food ingredient solutions including yogurt powder applications within bakery and supplement sectors. This divestment is part of a wider transformation that enhances Kerry’s strategic focus on high‑growth nutrition markets.
April  2024 : Glanbia plc agreed to acquire Flavor Producers LLC, a US flavour and extract business, for approximately USD 300 million. This acquisition strengthens Glanbia’s Nutritionals division by broadening its natural and organic flavours portfolio, which supports enhanced product development for yogurt powder applications in beverages, bakery, and functional foods.

Impact of Industry Transitions on the Yogurt Powder Market

As a core segment of the Packaged & Processed F&B industry, the Yogurt Powder market develops in line with broader industry shifts. Over recent years, transitions such as Shift Towards Healthy Eating and Technological Advancements in Production have redefined priorities across the Packaged & Processed F&B sector, influencing how the Yogurt Powder market evolves in terms of demand, applications and competitive dynamics. These transitions highlight the structural changes shaping long-term growth opportunities.
01

Shift Towards Healthy Eating

The accelerating shift towards healthy eating is transforming the Yogurt Powder market from a niche ingredient into a high-growth functional food platform, projected to add approximately $93 million to market growth by 2030. As consumers seek high‑protein, probiotic‑rich, and shelf‑stable dairy options, powdered yogurt is gaining share in categories such as sports nutrition, meal replacement, and ready‑to‑mix drinks, where convenience and gut health benefits are critical purchase drivers. This transition is reinforcing demand for clean‑label, fortified dairy formats that deliver the nutritional profile of traditional yogurt with superior portability and storage efficiency. In response, manufacturers are repositioning Yogurt Powder as a versatile base for high‑protein snacks and instant beverages, tightening their innovation and marketing strategies around wellness claims to capture incremental value in health‑focused channels.
02

Technological Advancements in Production

The yogurt powder industry has experienced significant transformation due to technological advancements in production, particularly the adoption of spray-drying and freeze-drying techniques. These methods allow manufacturers to produce powders that closely replicate the flavor, creaminess, and texture of fresh yogurt while retaining key nutrients such as probiotics, calcium, and proteins. This transition has positively impacted bakery, nutritional supplement, and personal care industries, enabling incorporation of yogurt powder into protein bars, fortified baked goods, smoothies, and skincare formulations without compromising stability or functionality. Companies like Fonterra, Arla Foods Ingredients, and Danone leverage these technologies to offer versatile, high-quality powders that support clean-label products and expand applications across health-focused and convenience-driven markets.