Demand for milk powder remains critically anchored by the infant nutrition segment, which single-handedly contributes over 35% of global market revenues. Beyond baby formula, the steady growth is driven by expanding applications across the convenience food, bakery, and confectionery sectors, which account for nearly 22% of total consumption. Crucially, the high-value segment of specialty powders—including lactose-free, fortified, and high-protein variants—is growing at an accelerated rate of 7–8% annually, presenting premium opportunities for manufacturers focused on health and functional foods.

From a supply standpoint, international trade flows are overwhelmingly dominated by three key regions. New Zealand, the European Union, and the United States collectively command nearly 80% of global export volumes. New Zealand leads the distribution with a 35% global share and an output of approximately 4.6 million metric tons, primarily driven by giants like Fonterra. The US is solidifying its role with over 2.2 million metric tons of output in 2025, supported by cooperatives like Dairy Farmers of America (DFA), while major multinationals such as Nestlé, Danone, and Arla Foods actively shape the competitive landscape.

The engine of global consumption remains the Asia-Pacific (APAC) region, which accounts for a commanding 42% of the global market share in 2025, valued at over $107.8 billion. This immense demand is concentrated in rapidly urbanizing and income-growing nations, led by heavy importers such as China, India, and Indonesia. China alone is expected to import more than 830,000 metric tons in 2025, a 6.2% year-on-year increase, driven by the fact that the APAC region accounts for fully 50% of global baby formula revenues.