Butter and Ghee Market Size, Share, Growth, and Industry Analysis, By Type (Butter & Ghee), By Downstream Industry (Food and Beverage & Cosmetics), and Regional Forecast to 2033

BUTTER AND GHEE MARKET OVERVIEW

The global Butter and Ghee market size expanded rapidly in 2022 and is projected to grow substantially by 2028, exhibiting a prodigious CAGR during the forecast period.

The market for butter and ghee plays a key role in the dairy industry of the world, as it produces products that are of good taste and nutritional content. Butter is a common food ingredient and is used in cooking and baking and also as a spread, whereas ghee, which is clarified butter, is valued because of its health properties and long shelf life. The stable market growth is caused by the increase in demand for natural and conventional dairy products by the consumers. Raising awareness about the Ayurvedic properties of ghee also favours market growth.

BUTTER AND GHEE MARKET KEY FINDINGS

Market Size and Growth: The global butter and ghee market size at present (2024) is estimated to be around USD 105.23 billion and is projected to go as high as almost USD 173.89749 billion with a CAGR of around 5.74 percent by 2033.

Key Market Driver: The increase in the demand for natural and organic dairy products is fuelling the growth, especially in the Asian-Pacific region, where more than 70 percent of consumers are merging on minimally processed products.

Major Market Restraint: The rising cases of lactose intolerance in the world, which has over 65 percent of the world population, restrict the use of dairy products.

Emerging Trends: Vegetable-derived ghee products are also becoming more popular, where the number of product releases will significantly grow to 35% in 2023.

Regional Leadership: There is a more than 40 percent market share of India in consuming ghee due to traditional eating habits.

Competitive Landscape: Key players such as Amul, Britannia, and Organic Valley are spending on superior products and rural distribution channels.

Market Segmentation: The market is categorized based upon the product type (unsalted butter, cultured butter, desi ghee, organic ghee), source (cow, buffalo), and distribution channel.

Recent Development: JAN/2024 Amul has introduced fortified ghee, which is aimed at the urban wellness portion, which is linked to a strategy of focusing on health-conscious consumers.

GLOBAL CRISES IMPACTING BUTTER AND GHEE MARKET

COVID-19 IMPACT 

Butter and Ghee Industry Had a Positive Effect Due to Demand Surged for Immunity-boosting and Natural Food products during COVID-19 Pandemic

The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden market growth reflected by the rise in CAGR is attributable to the market’s growth and demand returning to pre-pandemic levels.

The COVID-19 pandemic had a beneficial effect on the butter and ghee market because the consumers turned to cooking at home and buying classic and immune-boosting foods. The rise in understanding of the health benefits of ghee (i.e., digestion and immunity boosting) caused a surge in demand. Baking and the increase in the consumption of comfort foods due to the lockdowns further spurred the sales of butter. Online shops made high-quality and handcrafted ghee available. In general, those trends contributed to consistent market growth throughout the pandemic times.

LATEST TRENDS

Infused and Flavoured Innovations Drive Market Growth

A trend of health-conscious and craft-centred products is gripping the butter & ghee market globally. Among the major trends, we have the emergence of infused and flavoured butters, such as herbed butters and truffle and spice mixes, which take everyday meals to a gourmet level. These special butters are convenient and offer an instant taste. Companies are trading off packaging to suit the brand and are also partnering with food pundits to support this trend. In general, such innovative outreaches are increasing the attractiveness of the market and the novel definition of experiences by the consumers.

BUTTER AND GHEE MARKET SEGMENTATION

BY TYPE

Based on Type, the global market can be categorized into Butter & Ghee

Butter: Butter is a well-known dairy product that is produced by churning milk or cream to separate fat. It is a boiler ingredient in baking, cooking, and spreading at home and in food services. The organic and artisanal butter is gaining popularity among the consumers due to its natural smell and natural taste. The raised popularity of the Western foods and the bakery items also contributes to the high popularity of the high-quality kinds of butter.

Ghee: Clarified butter Ghee is culturally important and medicinal, specifically in the South Asian cuisines. It has an excellent smoke point and a particular nutty flavour, which makes it usable in different cooking processes. Ghee has various possible advantages and can be consumed by health-conscious consumers, like promoting digestion and the ability to be lactose-free. The ghee segment is experiencing increased growth because of the popularity of the Ayurvedic and natural health movements in the world.

BY DOWNSTREAM INDUSTRY

Based on Downstream Industry, the global market can be categorized into Food and Beverage & Cosmetics

Food and Beverage: Butter and ghee are essential food and beverage products in the food and beverage industry, which are applied as flavour enhancers and thickeners and to add richness to products. They are applied in bakery products, confections, sauces, and ready-to-eat foods. The popularity of using natural and healthy ingredients among the consumers is behind including them in quality food items. Moreover, the increasing popularity of ethnic and gourmet foods in the global market is also another factor that contributes to the growth of the market in this direction.

Cosmetics: Butter and ghee have found a growing demand in the cosmetics business since they are more hydrating and nourishing. They are natural skin cream bases, lip balms, and hair products. Due to the rising demand for chemical-free as well as organic personal care products, these fats of dairy products have witnessed an increasing incorporation. They are also health-conscious (antioxidant) and ecologically friendly (skin-repairing) products.

MARKET DYNAMICS

Market dynamics include driving and restraining factors, opportunities and challenges stating the market conditions.                          

DRIVING FACTORS

Health-driven Preferences Significantly Boost Market Growth Globally

People are turning more towards natural, organic, and minimally processed food products such as butter and ghee. Processed fats and oils are viewed as less healthy than these products. There is also the clean-label trend that pumps up the organic dairy fats market. Moreover, the knowledge of the nutrients of ghee, e.g., vitamins and healthy fats, is increasing as well. This transformation in the eating preferences that are now more towards healthier food really contributes to the Butter and Ghee Market Growth.

Ethnic Cuisine Trends Strongly Drive Market Growth

The increased popularity of ethnic foods (Indian and Middle Eastern in particular) around the world has prompted the ghee demand. On the same note, there is an increase in the use of butter in baked goods and an increase in the consumption of butter in Western culture related to the trend in baking. Restaurants and home cooks both are going back to authentic ingredients to bring out the flavor. The food premiumization helps to justify this demand. Consequently, the consumption of butter and ghee is spreading to other fields of culinary usage.

RESTRAINING FACTOR

Health Concerns Over Fats Hinder Market Growth

An important factor that acts as a restraint to the butter and ghee market is increased health awareness issues concerning high saturated fat levels. Some consumers are convinced that butter and ghee emanate consequences of developing heart diseases and obesity. This attitude forces some people to use vegetable foods or low-fat foods. Also, in some areas there are strict dietary standards that discourage the eating of animal fats. All of this in combination prevents the market from realizing its full potential.

OPPORTUNITY

Rising Organic Demand and Ayurveda Trends Boost Market Growth

One of the business opportunities that exist in the butter and ghee market is the increased demand for organic and grass-fed dairy products. There is a growing demand for natural and less processed foods, which increases the demand for premium butter and ghee. The use of e-commerce platforms accesses greater product accessibility to the international markets. Besides, the trend of Ayurvedic and other common diets is increasing the demand for ghee. The trends have a strong potential for market growth in the future.

CHALLENGE

Health Concerns and Alternatives Challenge Market Growth

The major threat to the butter and ghee market is the growing health and nutrition-related issues about fat. People are increasingly switching to low-fat or vegetable foods, as there are concerns about cholesterol and cardiac activity. Another competitive factor is margarine and the alternatives of non-dairy butter in the market. Variation in the prices of raw milk likewise influences the cost of production. All these are some of the obstacles to sustained market expansion.

BUTTER AND GHEE MARKET REGIONAL INSIGHTS

●       NORTH AMERICA

North America Drives Market Growth with Health Trends

North America occupies a significant Butter and Ghee Market Share because of high consumer demand for natural and organic dairy products. The market growth is also enhanced by the introduced dairy industry in the region as well as the emerging culinary trends. One of the major contributors is the United States Butter and Ghee Market, with most people switching to using clarified butter in their cooking, as well as a health-conscious diet. U.S. manufacturing companies are increasing product lines to conform to clean label trends. This is strengthening the market leadership of North America.

●       EUROPE

Europe’s Dairy Heritage Supports Market Growth Globally

Europe also plays an equal role in the butter and ghee market in terms of its dairy heritage and influence on consumer preference towards having high-quality butter products. European states lay vital focus on artisan and natural butter, which suits premium markets. The widespread popularity of European cuisine in the world market is what leads to the demand for European-produced butter. Also, European Union laws guarantee the products quality and safety, which boosts the level of trust in the market. The consumption of ghee is slowly rising in niche markets that are subject to the global culinary trends.

●       ASIA

Cultural Demand and Exports Drive Asia’s Market Growth

Asia is taking a leading position in the butter and ghee market due to high cultural and culinary demand for ghee, especially in such countries as India and Pakistan. Ghee finds its place in conventional cooking, religious ceremonies, and Ayurvedic medicine. Consumption of packaged and branded butter and ghee is increasing due to an increase in disposable incomes and urbanization. The demand is also driven by the rising foodservice business in Asia. Also, Asian exports serve the interests of the world ethnic food market.

KEY INDUSTRY PLAYERS

Innovative Products and Sustainability Drive Market Growth

Major stakeholders in the butter and ghee market are also driving the growth by coming up with innovative products such as organic and flavoured butter to adjust to the growing demand. Their investment focuses on good branding and marketing services in a bid to promote product visibility and consumer franchise. Building extensive distribution networks, especially online retail, around the globe will enhance the easy reach of these firms by more people. In addition to this, large players are also focusing on sustainable sourcing and production processes, which have appealed greatly to environmentally conscious consumers as well as health-conscious consumers, contributing to the growth of the market.

LIST OF TOP BUTTER AND GHEE COMPANIES

GOPALJEE ANANDA (India)

Nestle (Switzerland)

Organic Valley (U.S.)

TIN STAR FOODS (U.S.)

Verka (India)

Britannia (India)

Pure Indian (U.S.)

Nanak Pure (Canada)

Ancient Organics (U.S.)

Amul (India)

KEY INDUSTRY DEVELOPMENTS

February, 2025: New Zealand company Milkio Foods presented the entire range of high-quality grass-fed ghee and butter spreads at the Gulfood 2025 in Dubai. Several varieties, such as grass-fed, organic, Himalayan sheep ghee, and blends of butter and ghee, were showcased in the booth that was aimed at global distributors and sides of both consumer packs and trump packs. Milkio has offered novel pack sizes varying between 250 mL jars and 10 L tubs and 1 MT pods that are targeted towards bulk retailers and food service outlets. As it was posing its premium ghee as one that the international importers would pick as a premium choice, the company was expressing its intention to venture into the Middle East and other parts of the world. This launch indicates the tendency in the sector, as the segment of premium, grass-fed, and export-oriented ghee products has still gained popularity with foreign distributors.

REPORT COVERAGE       

The study encompasses a comprehensive SWOT analysis and provides insights into future developments within the market. It examines various factors that contribute to the growth of the market, exploring a wide range of market categories and potential applications that may impact its trajectory in the coming years. The analysis takes into account both current trends and historical turning points, providing a holistic understanding of the market's components and identifying potential areas for growth.

The research report delves into market segmentation, utilizing both qualitative and quantitative research methods to provide a thorough analysis. It also evaluates the impact of financial and strategic perspectives on the market. Furthermore, the report presents national and regional assessments, considering the dominant forces of supply and demand that influence market growth. The competitive landscape is meticulously detailed, including market shares of significant competitors. The report incorporates novel research methodologies and player strategies tailored for the anticipated timeframe. Overall, it offers valuable and comprehensive insights into the market dynamics in a formal and easily understandable manner.