Butter Market Analysis

Global Butter Market Overview

Butter Market Size was valued at USD 20.06 Billion in 2023. The Butter market industry is projected to grow from USD 20.96 Billion in 2024 to USD 28.58 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 3.95% during the forecast period (2024 - 2032). Increasing demand for butter in food processing and the growth of the horeca industry are the key market drivers incorporating the market's growth.

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Butter Market Trends

Raise in demand for natural and organic products is driving the market growth.

The demand for natural and organic products drives the market CAGR for butter. Health-conscious consumers seek food options free from artificial additives, preservatives, and synthetic chemicals. This shift in consumer behavior has prompted manufacturers to offer organic and natural butter variants to cater to this growing demand. Organic butter, made from milk sourced from organically raised cows, has gained traction due to its perceived health benefits and environmentally friendly production methods. Consumers are getting more aware of the health risks associated with pesticides and genetically modified organisms, so the demand for organic butter has surged. Moreover, the rising concerns about the environmental impact of conventional dairy farming practices, such as antibiotics and hormones, have further fueled the demand for organic and natural butter. As a result, market players increasingly focus on expanding their organic product portfolios and adopting sustainable farming practices to meet consumer expectations.

Butter is a widely used ingredient in various food applications, from baking and cooking to confectionery and dairy products. The versatile nature of butter and its ability to enhance the taste, texture, and mouth feel of food products have contributed to its widespread adoption across the culinary world. The bakery industry represents a significant consumer of butter, with bakers relying on its unique properties to create flaky pastries, rich cakes, and buttery croissants. The rising trend of artisanal and gourmet baked goods has further propelled the demand for premium-quality butter with distinct flavors and textures in recent years. Moreover, the dairy industry has also witnessed the utilization of butter in producing ice creams, creams, and yogurts.

Butter manufacturers are introducing innovative product offerings and flavor variations to cater to diverse consumer preferences. Traditional unsalted and salted butter varieties are now accompanied by a wide range of flavored butter, such as garlic, herb-infused, truffle, honey, and fruit-flavored options. These flavored butter add a unique taste and aroma to various culinary creations, enhancing their appeal among consumers. Furthermore, introducing plant-based butter alternatives has emerged as a notable trend in the market. With the growing popularity of vegan and plant-based diets, consumers seek dairy-free butter alternatives made from plant oils and other non-dairy ingredients. This segment has witnessed substantial growth, with manufacturers investing in research and development to improve plant-based butter substitutes' taste, texture, and functionality.

The demand for natural and organic products and the growing popularity of flavored butter and plant-based alternatives have significantly influenced the market landscape. Furthermore, butter's versatility in food applications, particularly baking, confectionery, and dairy products, has contributed to its continued growth and expansion. As the industry evolves, manufacturers must stay abreast of these trends and continue to adapt to consumer demands, driving the Butter market revenue.

Butter Market Segment Insights

Butter Product Type Insights

The Butter market segmentation, based on product type, includes standard butter, clarified butter, whipped butter, and others. The standard butter segment dominated the market. It is made by churning fresh cream or milk, creating a smooth and creamy texture. Standard butter has a rich flavor and is widely used in cooking, baking, and as a spread. It is a versatile product that can be used in various culinary applications.

Butter Category Insights

The Butter market segmentation, based on category, includes salted and unsalted. The salted category generated the most income. Salted butter is made by churning cream and adding salt to the mixture. Adding salt provides a savory flavor profile to the butter, enhancing its taste and adding a hint of saltiness. Salted butter is commonly used to spread bread, toast, and other baked goods. The salt content also acts as a natural preservative, extending the shelf life of the butter. Furthermore, the salt in butter helps to bring out the flavors in various recipes, making it a popular choice among chefs and bakers.

Butter Form Insights

The Butter market segmentation, based on form, includes spreads, liquid/oil, blocks, and others. The spreads category generated the most income. These are popular form of butter that offers convenience and ease of use. These spreads are usually made by blending butter with oils or other ingredients to create a softer and spreadable consistency. Spreads are commonly used for spreading on bread, toast, or bagels. They often come in various flavors, such as garlic, herb, or honey.

Butter End-Use Insights

The Butter market segmentation, based on end-use, includes food processing, food service, and food retail. The food processing segment dominated the market. It adds flavor, texture, and richness to these products, making them more appealing to consumers. Butter is widely used in pastries, croissants, cookies, and cakes, providing a creamy and indulgent taste. Food processing companies rely on butter to enhance the quality and taste of their products, thereby driving the demand for butter in this segment.

Figure 1: Butter Market by End-Use, 2022 & 2032 (USD Billion)

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Butter Regional Insights

By region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. The North American Butter market area will dominate this market due to the high demand for butter in the food service industry and the popularity of baking and cooking among consumers. The market in Canada is significant, with consumers showing a preference for natural and organic butter products. This region's demand for specialty and flavored butter is increasing, catering to consumer preferences for unique and gourmet food experiences.

Further, the major countries studied in the market report are The US, Canada, German, France, the U.K., Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 2: BUTTER MARKET SHARE BY REGION 2022 (USD Billion)

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Europe's Butter market accounts for the second-largest market share due to its rich dairy farming and butter-making heritage. European consumers often value quality and tradition when it comes to butter, with a preference for high-fat content and natural products. However, there is also a growing demand for healthier and low-fat butter alternatives. The European Union implements strict regulations on butter production, ensuring product safety and quality. Further, the German Butter market held the largest market share, and the U.K. Butter market was the fastest-growing market in Europe.

The Asia-Pacific Butter Market is expected to grow fastest from 2023 to 2032. It is due to changing dietary habits, urbanization, and the influence of Western food culture. In addition to traditional uses, butter is increasingly used in baking, confectionery, and other food applications in this region. Market players are engaging in product innovation to cater to the diverse preferences of consumers in this dynamic market. Moreover, China’s Butter market held the largest market share, and the Indian Butter market was the fastest-growing market in the Asia-Pacific region.

Butter Key Market Players & Competitive Insights

Leading market players are investing heavily in research and development to expand their product lines, which will help the Butter market grow even more. Market participants are also undertaking various strategies to expand their footprint, with important market developments including new product launches, agreements, mergers and acquisitions, more investments, and collaboration with other organizations. The Butter industry must offer cost-effective items to expand and survive in a more competitive and rising market climate.

Manufacturing locally to minimize operational costs is one of the key business tactics manufacturers use in the Butter industry to benefit clients and increase the market sector. In recent years, the Butter industry has offered some of the most significant advantages to medicine. Major players in the Butter Market, including Ornua Co-operative Ltd. (Ireland), Gujarat Co-operative Milk Marketing Federation Ltd. (Amul) (India), Arla Foods amba (Denmark), Dairy Farmers of America Inc. (U.S.), Fonterra Co-operative Group (New Zealand), Organic Valley (U.S.), Land O'Lakes Inc. (U.S.), Lactalis Group (France), Royal Friesland Campina N.V. (Netherlands), Delta Nutritive (India), and others, are attempting to increase market demand by investing in research and development operations.

Arla Foods Amba, founded in 2000, and located in Viby, Denmark, is a Danish-Swedish international company, one of the largest producers of dairy products in the United Kingdom. In March 2021, Arla Foods, a major dairy company, announced to expand its Lupak Lighter portfolio by introducing a new light butter in the U.K.

Fonterra Co-operative Group Limited, founded in 2001 in Auckland, New Zealand, is an international dairy company owned by farmers. It is the sixth-largest dairy company in the world which produces milk, butter, cheese, and yogurt. In February 2019, Fonterra Co-operative Group Limited signed with New Zealand farms to supply milk to the a2 Milk company. The a2 Milk Company aims to grow in the new and existing market segments with the support of farmers.

Key Companies in the Butter market include

• Ornua Co-operative Limited (Ireland)


• Gujarat Co-operative Milk Marketing Federation Ltd. (Amul) (India)


• Arla Foods amba (Denmark)


• Dairy Farmers of America Inc. (U.S.)


• Fonterra Co-operative Group (New Zealand)


• Organic Valley (U.S.)


• Land O'Lakes Inc. (U.S.)


• Lactalis Group (France)


• Royal FrieslandCampina N.V. (Netherlands)


• Delta Nutritives (India)

For instance, October 2022 the natural nut butter company EATNUF from Singapore intended to enter Malaysia and China in 2023. By 2023, the company plans to begin offering black sesame seed spread alongside its traditional almond and cashew nut butter on online shopping platforms.

For instance, June 2022 Cavin's brand, a reputable FMCG company with its corporate headquarters in Chennai, CavinKare, presented fresh butter to the market. Butter is now offered in two varieties from the brand frying butter and table butter.

Butter Market Segmentation

Butter Product Type Outlook

• Standard Butter


• Clarified Butter


• Whipped Butter


• Others

Butter Category Outlook

• Salted


• Unsalted

Butter Form Outlook

• Spreads


• Liquid/Oil


• Blocks


• Others

Butter End-Use Outlook

• Food Processing


• Foodservice


• Food Retail

Butter Regional Outlook

• 
  North America
  
  
  
  • US
  
  
  • Canada
  
  
  
  


• 
  Europe
  
  
  
  • Germany
  
  
  • France
  
  
  • UK
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• 
  Asia-Pacific
  
  
  
  • China
  
  
  • Japan
  
  
  • India
  
  
  • Australia
  
  
  • South Korea
  
  
  • Australia
  
  
  • Rest of Asia-Pacific
  
  
  
  


• 
  Rest of the World
  
  
  
  • Middle East
  
  
  • Africa
  
  
  • Latin America