DENVER – Even as consumers’ preferences and purchasing behaviors keep changing, the dairy market is expected to keep growing.

As detailed in a new report from CoBank, most shoppers in the United States purchase dairy products and 90% of those polled have no plans to reduce their dairy purchases in the next three years.

What’s more, the report from CoBank’s Knowledge Exchange, Dairy Products Have More Growth Potential, projected that cheese and butter in particular have even more upside potential. Plus, it identified new growth opportunities tied to consumers who are increasingly looking for healthy, protein-rich snack products.

Citing data from market research firm Circana, CoBank noted that refrigerated dairy products were the largest retail grocery category in the past year, with $76 billion in sales. And dairy retail sales registered a growth rate of 15.4% ($10.1 billion) over the last three years.

Although US consumers are drinking less milk, CoBank pointed to cheese, butter and yogurt more than offsetting that shift, with new dairy-based products focusing on convenience, health and snacking trends also boosting the category.

CoBank’s lead dairy economist, Corey Geiger, said innovative dairy processors are leveraging the diversity of applications to their advantage.

“The healthy snacking category is a growing megatrend that dairy products can capitalize on with a host of conveniently packaged solutions from low-fat cheeses and specialty yogurts to functional dairy drinks,” Geiger said.

Additionally, traditional dairy products may appeal to consumers who are concerned about highly processed foods and seeking clean labels, CoBank food and beverage economist Billy Roberts said.

“One of the things we’ve learned from following the plant-based food sector is that long ingredient legends are an obstacle for many younger, health-conscious consumers,” Roberts said. “Dairy products are generally perceived as having clean labels with few ingredients. Dairy brands can capitalize on that with the right product mix and marketing.”

The report also highlighted the success of the global cheese snack market, which is projected to reach $75.1 billion in 2024, and could grow at a compound annual growth rate of 6.5% over the next decade.

Among other notable trends, the report shared that private label products are outpacing brands in 10 of 15 dairy categories, with yogurt, cream cheese, cream and creamers leading the way.

CoBank also identified lactose-free products as a relevant innovation avenue, with 120 million Americans reportedly dealing with some form of lactose intolerance.

The full report is available online via the CoBank website.