GCC Dairy Market Outlook
According to the report by Expert Market Research (EMR), the GCC dairy market size reached a value of USD 10.49 Billion in 2024. With a rising consumer demand for dairy products driven by population growth, an expanding middle class, and a shift towards healthier dietary habits, the market is expected to grow at a robust compound annual growth rate (CAGR) of 5.30% from 2025 to 2033, ultimately reaching a market value of USD 16.70 Billion by 2033.
The dairy sector in the Gulf Cooperation Council (GCC) countries, which includes Saudi Arabia, the United Arab Emirates (UAE), Qatar, Oman, Kuwait, and Bahrain, has experienced significant growth in recent years. This growth is propelled by increasing consumer awareness of the nutritional benefits of dairy, as well as evolving dietary trends that emphasize health and wellness. The expansion of modern retail chains, convenience foods, and the increasing availability of dairy products in supermarkets and online platforms also contribute to the market’s upward trajectory.
Key Drivers of Market Growth
Several factors are contributing to the expansion of the GCC dairy market. The region’s rapidly growing population, especially the young demographic, continues to drive the demand for dairy products. In addition, urbanisation and rising incomes have increased the consumption of processed and ready-to-eat dairy goods. These shifts are complemented by a growing demand for dairy products such as milk, cheese, butter, and yogurt.
One of the primary factors driving the dairy market in the GCC is the increasing health consciousness among consumers. Dairy is widely recognised as an excellent source of essential nutrients, including calcium, protein, and vitamins, which contribute to bone health, muscle repair, and overall well-being. As a result, there has been a surge in the consumption of products like low-fat milk, lactose-free options, and probiotic-rich yogurt.
The rising demand for plant-based dairy alternatives also plays a significant role in the evolution of the GCC dairy market. As consumers become more health-conscious and environmentally aware, the demand for non-dairy milk options, such as almond, soy, and oat milk, is increasing. Dairy manufacturers are now increasingly introducing plant-based variants to cater to the growing vegan, lactose-intolerant, and environmentally-conscious population segments.
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Cheese and Yogurt Market Trends
Cheese and yogurt have emerged as key growth categories in the GCC dairy market, driven by changing consumer preferences and an increasing demand for functional foods. As consumers become more health-conscious, they seek out dairy products that provide not only taste but also added health benefits.
Yogurt, particularly probiotic yogurt, is gaining popularity in the region, thanks to its digestive health benefits and the growing awareness of gut health. In response to this trend, manufacturers are introducing new varieties of yogurt, such as Greek yogurt, which is perceived as a more nutritious and protein-rich alternative to traditional yogurt. Additionally, the trend of on-the-go consumption is boosting the demand for ready-to-eat yogurt products, further enhancing the growth prospects of the yogurt market.
Cheese is also witnessing an upward trend in the GCC market, as it is increasingly used in cooking, snacking, and as a topping for various dishes. The demand for both traditional varieties such as cheddar and mozzarella, as well as premium and international cheeses, is on the rise. The growing number of expatriates from countries where cheese consumption is ingrained in their culinary culture has further contributed to the rising demand.
Impact of Technological Advancements
Technological advancements in dairy production and processing are playing a pivotal role in driving the growth of the GCC dairy market. Modern dairy farms in the region are adopting advanced milking equipment, automation, and quality control systems that ensure higher yields and better-quality milk. These technological advancements are also helping to maintain the freshness and shelf life of dairy products, meeting the region’s demand for high-quality products despite its challenging climate and logistical issues.
Moreover, the implementation of advanced packaging technologies is revolutionising the way dairy products are packaged and marketed. Innovations such as eco-friendly packaging, portion-controlled containers, and extended shelf-life packaging have improved the consumer experience and contributed to increased product availability. This has made dairy products more accessible to the growing urban population, further accelerating market growth.
GCC Dairy Market Segmentation
The GCC dairy market can be divided based on by flavour, by category, by product type, end-use, sales channel and region.
Breakup by Product
- Fluid Milk
- UHT Milk
- Flavoured Milk
- Cream
- Butter
- Anhydrous Milk Fat (AMF)
- Skimmed Milk Powder (SMP)
- Whole Milk Powder (WMP)
- Whey Protein(Powder and Concentrate)
- Lactose
- Cheese
- Yoghurt
- Ice-cream
- Others
Market Breakup by Region
- Saudi Arabia
- United Arab Emirates
- Kuwait
- Oman
- Qatar
- Bahrain
Competitive Landscape
Some of the major key players explored in the report by Expert Market Research are as follows:
- Almarai Company
- National Agricultural Development Company (NADEC)
- Al Rawabi Dairy Company
- Al Ain Dairy
- Saudia Dairy & Foodstuff Company(SADAFCO)
- Nestlé S.A.
- Fonterra Co-operative Group Limited
- Arla Foods amba
- Lactalis Group
- Others
Challenges Facing the GCC Dairy Market
Despite the promising outlook, the GCC dairy market faces several challenges. One of the major hurdles is the region’s harsh climate, which makes dairy farming more challenging and expensive. With limited arable land and water scarcity being significant concerns, GCC countries have been forced to rely on imports of raw milk and dairy products from international markets. This reliance on imports increases the vulnerability of the market to fluctuations in global supply chains and trade regulations.
Another challenge for the GCC dairy market is the growing awareness around environmental sustainability. The dairy industry is under increasing pressure to adopt more sustainable practices in terms of water usage, animal welfare, and carbon emissions. As a result, there is an increasing emphasis on finding sustainable dairy production methods, such as reducing water consumption and using renewable energy in production facilities.
Furthermore, the rising competition from plant-based dairy alternatives is impacting the market dynamics. While the demand for traditional dairy products remains strong, many consumers are shifting towards non-dairy options due to concerns over lactose intolerance, veganism, and environmental sustainability. This trend is leading dairy producers to explore ways to diversify their product portfolios and cater to a broader range of consumer preferences.
Future Outlook
Looking ahead, the GCC dairy market is poised for continued growth, driven by the region’s expanding population, evolving dietary preferences, and technological innovations in dairy production. The increasing demand for both traditional dairy products and plant-based alternatives will create opportunities for manufacturers to diversify their product offerings and cater to a wider consumer base.
As the market becomes more competitive, industry players are likely to focus on differentiation through product innovation, sustainable practices, and enhanced consumer engagement. The growing popularity of dairy as a source of nutrition and the rising trend of health-conscious eating are expected to fuel demand for high-quality, functional dairy products that offer both taste and health benefits.
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