South Korea Dairy Market Outlook

The South Korea dairy market size reached a value of approximately USD 4.05 billion in 2024 and is expected to grow at a compound annual growth rate (CAGR) of around 4.00% during the forecast period from 2025 to 2034. This will bring the market value to around USD 5.99 billion by 2034. The growth in the dairy market is primarily driven by increasing consumer demand for dairy products, rising health-consciousness, and the growing variety of dairy-based products available in the market. Additionally, dairy consumption is being supported by evolving consumer preferences for nutritious and convenient food options.

The South Korean dairy industry has witnessed significant changes, with consumers opting for more varied dairy products beyond traditional milk. The demand for products like yogurt, cheese, and baby formula is on the rise, with many consumers focusing on the nutritional value of these products. Moreover, dairy consumption in South Korea is being influenced by the increasing acceptance of Western-style diets, which include more dairy-based foods such as cheese and butter.

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South Korea Dairy Market Trends

Several key trends are shaping the South Korean dairy market. The first major trend is the increasing demand for health-focused dairy products. Consumers are becoming more health-conscious, looking for dairy products that offer added health benefits such as probiotics, high protein content, and low-fat options. This is particularly evident in the growing demand for yogurt and other fermented dairy products, which are perceived to offer digestive health benefits.

Another trend is the rising preference for premium and specialized dairy products. With higher disposable incomes, South Korean consumers are increasingly willing to pay a premium for high-quality dairy items, such as organic milk and specialty cheeses. The trend towards premiumization is driving the introduction of new, high-end dairy products in the market, catering to consumers who prioritize quality and health benefits over price.

Convenience and ready-to-eat options are also gaining popularity in South Korea. The fast-paced lifestyle of urban dwellers is leading to an increased demand for packaged and easy-to-consume dairy products, such as single-serve yogurt and baby formula. This trend is being supported by innovations in packaging that provide convenience, freshness, and longer shelf life.

In addition, the popularity of plant-based alternatives is rising in South Korea, especially among younger consumers. While traditional dairy products still dominate the market, there is a growing interest in plant-based milk alternatives, such as soy and almond milk, which are perceived as healthier and more sustainable options. However, dairy-based products are expected to remain the core of the market due to their superior nutritional profile and cultural importance in South Korea.

South Korea Dairy Market Growth

The South Korean dairy market is expected to experience steady growth, with a projected CAGR of 4.00% from 2025 to 2034. One of the key drivers of this growth is the increasing demand for dairy products in South Korea, particularly as the population becomes more health-conscious and seeks nutritious options. Products like yogurt, cheese, and baby formula are expected to witness strong demand, as consumers increasingly prioritize functional foods that contribute to health and well-being.

The dairy market is also benefiting from the growing popularity of Western diets in South Korea, with more consumers incorporating dairy products like cheese and butter into their daily meals. Additionally, as South Korea continues to urbanize, the demand for convenient and ready-to-eat dairy products is rising. The trend towards more diversified dairy consumption, such as baby formula and condensed milk, is also helping to support the market growth.

Moreover, the increasing focus on innovation in dairy products, particularly in terms of nutritional content and health benefits, is expected to contribute significantly to market expansion. New product introductions that cater to the evolving needs of health-conscious consumers, such as dairy products enriched with vitamins, minerals, and probiotics, will further fuel market growth.

In addition, South Korea’s thriving food service industry, which increasingly includes dairy-based products, is helping to drive the demand for dairy in both retail and food service sectors. The rise of dairy consumption in convenience stores, supermarkets, and online channels is further propelling the market’s expansion.

South Korea Dairy Market Segmentation

1. By Product
   • Milk: Milk remains the most consumed dairy product in South Korea, and its demand continues to grow. With the rise in health-conscious consumers, there is increasing preference for low-fat, organic, and fortified milk products. Milk-based beverages are also gaining popularity as part of breakfast routines, contributing to the growth of this segment.
   • Dry Milk: Dry milk is in demand due to its longer shelf life and convenience for both household and industrial use. It is often used in the food processing industry and as an ingredient in a variety of dairy-based products such as cakes, sauces, and soups.
   • Cheese: Cheese consumption has been growing steadily in South Korea, especially in urban areas. The trend towards Western-style diets, which include cheese-based dishes like pizza and sandwiches, is driving the demand for various types of cheese, including mozzarella and processed cheese.
   • Yogurt: Yogurt is rapidly gaining popularity in South Korea due to its perceived health benefits, including digestive health. The increasing awareness of probiotics and their role in gut health is driving yogurt consumption. Additionally, flavored and functional yogurts are seeing significant growth.
   • Butter: Butter consumption is on the rise, especially with the popularity of Western-style cooking in South Korea. It is used in various culinary applications, including baking and cooking. The demand for butter is also being supported by the increasing consumption of dairy-based spreads and margarine.
   • Baby Formula: Baby formula is a key product segment in South Korea, driven by the growing awareness of the importance of nutrition for infants. Baby formula brands that offer organic, nutrient-enriched options are gaining popularity, as parents increasingly seek healthy alternatives to breastfeeding.
   • Condensed Milk: Condensed milk is a staple in South Korean kitchens and is widely used in desserts, beverages, and cooking. Its versatility and long shelf life have contributed to its continued demand.
2. By Distribution Channels
   • Supermarkets and Hypermarkets: Supermarkets and hypermarkets are the largest retail distribution channels for dairy products in South Korea. These large-scale retail outlets offer a wide range of dairy products and provide consumers with easy access to both local and imported dairy items.
   • Convenience Stores and Discount Stores: Convenience stores and discount stores are growing in importance as more consumers seek quick and easy access to dairy products. These stores are increasingly stocking a variety of dairy items, including ready-to-eat products like yogurt and milk-based beverages, catering to the on-the-go lifestyle of urban consumers.
   • Grocery Stores: Grocery stores remain an important retail channel for dairy products, particularly for everyday essentials like milk, cheese, and butter. Smaller, local grocery stores offer a more personalized shopping experience and cater to local preferences.
   • Online: The online distribution channel is expanding rapidly, driven by the rise in e-commerce and the convenience of online shopping. Consumers can now purchase dairy products online and have them delivered to their homes, which is particularly appealing to busy urban dwellers.
   • Department Stores: Department stores also contribute to the sales of premium dairy products, particularly high-end, imported, and specialty dairy items. These stores offer exclusive dairy brands and products to cater to affluent consumers looking for luxury items.
3. By Region
   • North America
     • United States of America: The U.S. is a significant supplier of dairy products to South Korea, particularly in terms of cheese and milk-based ingredients. South Korea imports a wide range of dairy products from the U.S., with cheese and dry milk being among the top items.
     • Canada: Canada’s dairy products, particularly cheese and milk, are also popular in South Korea. The ongoing demand for dairy imports from Canada reflects strong bilateral trade relations in the dairy sector.
   • Europe
     • United Kingdom, Germany, France, Italy: European countries are major exporters of premium dairy products, including specialty cheeses, butter, and yogurt, to South Korea. South Korea’s growing appetite for Western dairy products is helping drive imports from these countries.
   • Asia Pacific
     • China, Japan, India: While South Korea is a key consumer of domestic dairy products, neighboring countries such as China and Japan are also important exporters of dairy products to South Korea, particularly milk powder and cheese.
   • Latin America
     • Brazil, Argentina, Mexico: Dairy products from Latin American countries, especially milk and cheese, are being increasingly exported to South Korea as the country diversifies its sources of dairy imports.
   • Middle East and Africa
     • Saudi Arabia, United Arab Emirates, Nigeria, South Africa: The Middle East and Africa are emerging regions for dairy exports to South Korea, with products like powdered milk and specialty cheeses gaining traction.

South Korea Dairy Market Key Players

1. Maeil Co. Ltd.: A leading South Korean dairy company, Maeil Co. Ltd. produces a wide range of dairy products, including milk, yogurt, cheese, and baby formula. The company is known for its strong brand presence and innovation in the dairy industry.
2. Namyang Dairy Products Co., Ltd.: Another prominent player in the South Korean dairy market, Namyang Dairy Products Co., Ltd. offers a variety of dairy products, with a particular focus on milk and yogurt. The company has a well-established presence in the retail and foodservice sectors.
3. Seoul Milk Cooperative: Seoul Milk Cooperative is one of the largest milk producers in South Korea, supplying a variety of dairy products, including fresh milk, cheese, and yogurt, to consumers across the country.
4. Dairyzen Co., Ltd.: A key player in the South Korean dairy industry, Dairyzen Co., Ltd. is known for its range of dairy products, including baby formula and yogurt, which are widely distributed across the country.
5. Nestlé SA: As a global leader in the food and beverage industry, Nestlé SA is a major supplier of dairy products in South Korea, particularly in the areas of powdered milk, baby formula, and nutritional dairy products.
6. Others: Other significant players in the South Korean dairy market include local and international companies such as Lotte Chilsung Beverage Co. and Korea Yakult Co., which contribute to the variety and growth of the market by offering a wide range of dairy products.