Australia Milk Powder Market by Region, Competition, Forecast & Opportunities, 2020-2030F

The Australia Milk Powder Market was valued at USD 422.45 Million in 2024, and is projected to reach USD 625.61 Million by 2030, rising at a CAGR of 6.76%. The Australia milk powder market is experiencing steady growth due to rising health consciousness, growing demand for convenient and long-lasting dairy alternatives, and increased consumer preference for high-protein foods.

Milk powder offers extended shelf life, easy storage, and versatility in cooking and baking, making it popular among households and the foodservice sector. The market is also driven by a surge in exports to countries like China, Southeast Asia, and the Middle East, supported by Australia’s strong dairy reputation and free trade agreements. However, domestic production faces challenges such as fluctuating raw milk availability and climate-related disruptions. Innovation in product formulation, including organic and fortified variants, is further enhancing consumer appeal across different demographic segments.

Key Market Drivers

Rising Health and Nutritional Awareness Among Consumers

One of the most prominent drivers of the milk powder market in Australia is the growing consumer emphasis on health and nutrition. With increasing awareness about the importance of protein, calcium, and essential vitamins in daily diets, milk powder has gained popularity as a nutrient-dense and convenient alternative to fresh milk. Milk production in Australia is projected to rise by 1.1 percent in 2025, reaching 8.8 million metric tons (MMT). This follows a solid 2.7 percent increase in 2024, which brought output to an estimated 8.7 MMT - marking a recovery after several years of declining production.

Australian consumers are becoming more health-conscious, particularly in urban centers, where dietary habits are shifting toward functional and fortified foods. Milk powder, especially when enriched with vitamins A, D, and calcium, aligns with this trend. It is being increasingly consumed by families, fitness enthusiasts, and the aging population for its role in supporting bone health, muscle strength, and immunity.

Additionally, with lactose-free and organic milk powder options entering the market, even consumers with dietary restrictions are able to include it in their nutrition plans. The growing interest in clean-label and high-protein products is driving demand for premium milk powders that meet wellness criteria without artificial additives or preservatives. As Australia continues to see rising cases of lifestyle-related health issues such as osteoporosis and protein deficiency, milk powder is gaining traction as a preventive and functional food product.

Key Market Challenges

Fluctuating Raw Milk Supply and Climatic Challenges

One of the major challenges confronting the Australian milk powder market is the inconsistent availability of raw milk, primarily due to fluctuating climatic conditions and declining dairy farm numbers. Australia’s dairy production is highly dependent on seasonal rainfall and water availability, which makes it vulnerable to droughts, floods, and temperature extremes. In recent years, prolonged dry spells in key dairy-producing regions such as Victoria and New South Wales have negatively impacted milk yield, reducing the volume of raw milk available for powder manufacturing.

Additionally, rising input costs - such as animal feed, energy, and water - have led many small-scale farmers to exit the industry, further constraining supply. As the dairy sector becomes more exposed to climate volatility, the entire milk powder supply chain - from procurement to processing - faces uncertainty. This unreliability not only limits the ability of manufacturers to meet domestic and export demand consistently but also discourages long-term investment in processing facilities. Moreover, reduced raw milk availability often drives up costs, pressuring profit margins for producers and increasing end-user prices, which can weaken market competitiveness.

Key Market Trends

Shift Toward Specialty and Functional Milk Powders

A key emerging trend in the Australian milk powder market is the growing demand for specialty and functional milk powders that offer added health benefits beyond basic nutrition. Consumers are increasingly seeking products tailored to specific dietary requirements and health goals, such as lactose-free milk powder for those with intolerances, high-protein formulations for athletes, and fortified powders enriched with vitamins and minerals for children and the elderly. This trend reflects a shift from traditional whole and skimmed powders to more personalized nutrition solutions.

Additionally, consumers are showing interest in niche offerings such as A2 milk powder, goat milk powder, and colostrum-enriched variants. These products are marketed as easier to digest, more natural, or richer in immune-boosting properties, aligning with Australia’s broader health and wellness movement. Dairy companies are responding by diversifying their product lines and investing in R&D to create differentiated offerings that meet evolving consumer expectations. This trend is not only reshaping domestic consumption but also enhancing Australia’s value proposition in high-end export markets where functional nutrition is increasingly prioritized.

Key Market Players

• Saputo Dairy Australia Pty Ltd
• Fonterra Co-operative Group Limited
• Bega Cheese Limited
• Murray Goulburn Co-operative Co. Limited
• Norco Co-operative Limited
• Parmalat Australia Pty Ltd
• Nestlé Australia Ltd
• Australian Dairy Nutritionals Group Ltd
• Tatura Milk Industries Ltd
• Burra Foods Australia Pty Ltd.

Report Scope:

In this report, the Australia Milk Powder Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

Australia Milk Powder Market, By Product Type:

• Whole Milk Powder
• Skimmed Milk Powder

Australia Milk Powder Market, By Application:

• Infant Formula
• Confectionery
• Sports and Nutrition Foods
• Bakery Products
• Others

Australia Milk Powder Market, By Distribution Channel:

• Supermarkets/Hypermarkets
• Convenience Stores
• Online
• Others

Australia Milk Powder Market, By Region:

• Australia Capital Territory & New South Wales
• Northern Territory & Southern Australia
• Western Australia
• Queensland
• Victoria & Tasmania

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Australia Milk Powder Market.

Available Customizations:

With the given market data, the publisher offers customizations according to a company's specific needs. The following customization options are available for the report.

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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