India Cheese Market Outlook to 2030

India Cheese Market Overview

• The India Cheese market is experiencing significant growth, with the market valued at USD 1.05 billion, based on a five-year historical analysis. This growth is driven by increasing consumer preference for dairy products, especially processed cheese, which is widely used in ready-to-eat and convenience foods. Urbanization, rising disposable income, and changes in dietary patterns are fueling this demand, with key developments seen in both retail and foodservice sectors. The growing trend of Western diets, particularly in urban centers, is boosting cheese consumption across India.

• The market is dominated by cities like Mumbai, Delhi, and Bangalore due to their large urban populations, higher consumer awareness of Western diets, and better access to cold chain infrastructure. These cities have witnessed significant demand for processed and specialty cheese products, as they are hubs for foodservice chains and restaurants that require high-quality cheese for pizzas, burgers, and other popular foods. The growing presence of international cheese brands and increasing investments in cold storage facilities also strengthen the dominance of these regions.
• FSSAI plays a critical role in regulating Indias cheese market, ensuring compliance with food safety standards. In 2023, FSSAI introduced new guidelines for the dairy industry, including specific quality standards for cheese production, packaging, and labeling. The authority also mandated a stricter hygiene protocol to prevent contamination. These regulations are aimed at improving the overall safety and quality of cheese products, thus boosting consumer confidence and supporting market growth.

India Cheese Market Segmentation

• By Product Type: The market is segmented by product type into fresh cheese, aged cheese, processed cheese, and organic cheese. Among these, processed cheese dominates the market due to its widespread use in ready-to-eat meals and fast food items like pizzas and sandwiches. Processed cheese offers convenience, longer shelf life, and consistent texture, making it a preferred choice in urban areas. It is also widely used in the foodservice industry due to its melting properties and ease of storage, which further drives its demand across restaurants and quick-service outlets.

• By Distribution Channel: The market is segmented by distribution channel into retail and foodservice. Retail distribution holds the largest share in the market, particularly through supermarkets, hypermarkets, and specialty stores, which provide better visibility and accessibility to a wide range of cheese products. Consumers in urban centers prefer purchasing cheese from supermarkets due to convenience and the availability of a variety of brands. Moreover, organized retail chains provide proper storage and handling facilities for cheese, ensuring product quality and extending shelf life.

India Cheese Market Competitive Landscape

The India cheese market is dominated by a mix of local and international players who have strong distribution networks, brand recognition, and a focus on innovation. The market consolidation is driven by a few large players like Amul and Britannia, who have a substantial hold over both the retail and foodservice sectors. These companies are capitalizing on their deep market reach and economies of scale. In addition, international brands such as Lactalis and Arla are increasingly penetrating the Indian market, introducing premium and specialty cheese products.

India Cheese Market Analysis

Growth Drivers

• Increasing Consumer Shift Toward Dairy Products: India's cheese consumption has increased significantly due to rising consumer preferences for dairy products. In 2024, the per capita dairy consumption in India stands at 394 grams per day, driven by urbanization and an expanding middle class that increasingly includes cheese in their diets. India's dairy sector produced over 220 million tons of milk in 2023, with a noticeable rise in cheese production to meet domestic demand. Furthermore, India's dairy exports have been solid, with cheese exports valued at USD 29 million in 2023, supporting the sector's growth.
• Growing Demand for Processed Cheese in Foodservice Industry: The foodservice industry in India is rapidly expanding, boosting demand for processed cheese. Indias food services market was valued at USD 71 billion in 2023, a key contributor to processed cheese sales, as restaurant chains, fast-food outlets, and cafes incorporate cheese-based offerings. In the same year, 11% of India's urban households consumed processed cheese products regularly, reflecting the increasing prevalence of Westernized fast foods. Quick-service restaurants (QSRs), particularly in metropolitan areas, have played a pivotal role in expanding processed cheese consumption.
• Rising Popularity of Organic and Artisanal Cheeses: India's artisanal and organic cheese segment has grown with consumer preferences shifting towards healthier, premium products. Organic cheese demand saw a 14% rise in urban centers, with production clusters emerging in Himachal Pradesh and Uttarakhand. By 2023, over 50 small-scale dairy farms focused on organic cheese were established, with annual production growing to over 1,000 metric tons. Additionally, Indias imports of organic cheese from countries like France and Italy reached USD 15 million in 2023, indicating a broader consumer base for premium cheese offerings.

Market Challenges

• Fluctuating Milk Prices: Cheese production in India is directly impacted by fluctuating milk prices. In 2023, the average price of milk was INR 53 per liter, representing a notable increase from INR 45 per liter in 2022. The volatility is driven by factors such as uneven monsoon seasons, rising feed costs, and increased demand for dairy products. Since cheese production is heavily milk-dependent, rising input costs have strained producers, particularly smaller businesses and artisanal cheese makers, leading to cost pressures throughout the supply chain.
• High Storage and Logistics Costs: Cheese requires a cold supply chain, contributing to high storage and logistics costs. By 2023, Indias cold chain infrastructure was still developing, with a shortfall of 8.5 million metric tons in cold storage capacity. The fragmented nature of the cold chain leads to inefficiencies, with over 25% of food products, including cheese, facing risks of spoilage during transport. High energy prices and insufficient warehousing infrastructure further elevate costs, especially for manufacturers targeting long-distance markets within India.

India Cheese Market Future Outlook

The India cheese market is poised for substantial growth over the next five years, driven by the increasing consumer preference for Western diets and processed foods, alongside growing disposable incomes. The market will likely see further expansion in retail and online channels, particularly in urban centers. Additionally, with the rise in health-conscious consumers, there will be greater demand for organic and low-fat cheese varieties. The growing influence of international cuisines in Indian food culture, coupled with the expanding foodservice industry, will contribute to the market's robust growth trajectory.

Future Market Opportunities

• Expanding Export Markets: Indias cheese exports have steadily grown, with markets in the Middle East and Southeast Asia offering new opportunities. In 2023, India exported over 10,000 metric tons of cheese, an increase of 8% from the previous year. Key export destinations include the UAE, Saudi Arabia, and Singapore, where Indian dairy products are highly valued. The government has facilitated this growth through favorable trade agreements, lowering barriers for dairy exports, thereby providing cheese manufacturers an opportunity to access lucrative international markets.
• Government Support for Dairy Farming: The Indian government has actively supported dairy farming through initiatives such as the National Dairy Plan (NDP). In 2023, the NDP allocated over INR 15 billion to enhance infrastructure, focusing on improving milk yields and expanding dairy cooperative networks. The number of registered dairy cooperatives increased by 6%, enhancing supply chain efficiency and boosting production capabilities. This robust support provides cheese manufacturers with a reliable source of high-quality milk, enabling the sector to expand its output.