Authored By: Sarah
11 Jul 2024

 Anhydrous Milk Fat (Butter Oil) Market Size to grow by USD 1573.22 million between 2024-2028

According to a research report “ Anhydrous Milk Fat (Butter Oil) Market” by Distribution Channel (Offline, Online) Product (Conventional, Organic) Geography (APAC, Europe, North America, South America, Middle East and Africa)- Global Forecast to 2028 published by Technavio, the market size is estimated to grow by USD 1573.22 million, at a CAGR of  7.51% during the forecast period. The global anhydrous milk fat (butter oil) market is experiencing significant growth due to the increasing consumer preference for superior quality dairy products. This trend is primarily driven by the perception that these products offer superior flavor and enhanced nutritional value, leading to increased consumption. Companies like Fonterra are capitalizing on this demand by manufacturing high-quality butter oil that caters to consumers' expectations for premium dairy ingredients. Fonterra's focus on providing superior butter oil is reflective of the market's response to the rising demand for high-end dairy products. This consumer-driven trend is expected to fuel the expansion of the global anhydrous milk fat (butter oil) market during the forecast period.

Browse market data tables, figures, and in-depth TOC on “Anhydrous Milk Fat (Butter Oil) Market” by Distribution Channel (Offline, Online) Product (Conventional, Organic) Geography (APAC, Europe, North America, South America, Middle East and Africa) Global Forecast to 2028. Download Free Sample


By Distribution Channel, the Offline segment is projected to dominate the market size in 2024

The conventional segment of anhydrous milk fat, or butter oil, is experiencing robust growth and holds a dominant position in the global market. Key players, such as Royal FrieslandCampina, are spearheading this expansion. The escalating demand for natural and dairy-based products in the food and beverage sector is fueling the market's growth. The dairy, confectionery, and baking industries rely on conventional anhydrous milk fat due to its authentic dairy flavor and luxurious, creamy texture. Given its association with traditional dairy processing methods that ensure superior taste and texture, the increasing consumer preference for high-end, premium products is bolstering the demand for this type of oil.

By Product, Conventional  segment is expected to hold the largest market size for the year 2024

The anhydrous milk fat (butter oil) market has witnessed significant revenue growth through offline distribution channels. Factors such as the demand for immediate product access, personalized customer service, and consumer preference for in-person transactions are fueling this trend. Key players in the industry, like Fonterra and Dairy Farmers of America, are capitalizing on this trend by expanding their presence in traditional retail outlets. The proliferation of hypermarkets and supermarkets globally is anticipated to boost the growth of the offline segment. For instance, Tesco, a leading UK-based supermarket, intends to establish 750 convenience stores in Thailand by 2022.

APAC is forecasted to hold the largest market size by region in 2024

In the Asia-Pacific (APAC) region, the anhydrous milk fat (butter oil) market has experienced significant growth in recent years. Key growth drivers include the increasing demand for processed foods, consumer preferences for dairy products, and the expansion of the food and beverage industry. Notable market participants, such as Fonterra and Groupe Lactalis, hold strong regional presences, bolstering market expansion. Anhydrous milk fat is indispensable in the burgeoning confectionery and baking industries of countries like China and India. Additionally, it is essential for the growing food service industry in APAC, encompassing fast-food franchises and restaurants, for various culinary applications, including baking, frying, sautéing, flavoring, and enriching recipes.

The Anhydrous Milk Fat (Butter Oil) Market growth and forecasting report also includes detailed analyses of the competitive landscape of the market growth and forecasting and information about 20 market companies, including:

  • Asha Ram and Sons Pvt. Ltd.
  • Corlasa
  • Dairy Farmers of America Inc.
  • Eximcan Canada
  • Fonterra Cooperative Group Ltd.
  • Food and Biotech Engineers India Pvt Ltd.
  • Foodcom SA
  • Geris
  • Groupe Lactalis
  • Inner Mongolia Yili Industrial Group Co. Ltd.
  • Interfood Corp.
  • Royal FrieslandCampina NV
  • Savencia SA
  • SG Foods
  • Synlait Ltd.
  • Uelzena Group
  • UGA Group

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Research Analysis Overview

Anhydrous Milk Fat, also known as Butter Oil, is a valuable dairy ingredient used extensively in various food applications. It is rich in nutrients like Calcium, Vitamins A, D, E, and K2, making it an excellent choice for immunity boosting and bone health. In baking, it is used to make shortbread and other baked goods due to its ability to provide excellent texture and yellow color. In sauce-making, grilling, roasting, and deep frying, anhydrous milk fat enhances the flavor and improves the shelf life of the final product. For recombined dairy products, it acts as a fat concentrate with a low water content. Anhydrous milk fat is also used in soups and sauces, adding richness and creaminess. Its nutritional benefits extend beyond food applications, with research suggesting it may aid in arthritis prevention. The production process involves refining, vacuum treating, churning, aging, pasteurizing, standardizing, chilling, centrifugation, and compounding. Capital investment in machinery for its production can be high, but the versatility and product differentiation make it a worthwhile investment. Raw materials include fresh milk or cream, and the final product can be stored for an extended period due to its long shelf life.

Market Research Overview

The Anhydrous Milk Fat (AMF) or Butter Oil market is a significant segment in the dairy sector, known for its labor-intensive production processes. The raw material suppliers, primarily dairy farmers, play a crucial role in the production chain. Advanced machinery is used for inventory management, refining, vacuum treating, churning, aging, pasteurizing, standardizing, chilling, and centrifugation to produce high-quality AMF. Geographical presence and a well-established distribution network are essential for market growth. Fusion food products, including chocolate bars, chocolate, praline fillings, pastries, pound cakes, butter cookies, shortbread, and baking, are significant consumers of AMF. In the health-conscious era, AMF is an alternative to butter for various applications, such as sauce-making, grilling, roasting, deep frying, and frying, in soups and sauces, and recombined dairy products. AMF offers numerous nutritional benefits, including immunity boosting, arthritis prevention, bone health, calcium, and vitamins. The market's capital investment includes raw materials and machinery. Product differentiation is achieved through various processes like refining, texturing, yellow color, fat concentrate, water content, and compounding. Input suppliers, including cattle health and feed, also impact the market's growth.


Technavio Research
Jesse Maida
Media & Marketing Executive
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UK: +44 203 893 3200

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