Lactose-Free Yogurt Market Size, Share, Growth, and Industry Analysis, By Type (Conventional & Organic), By Application (Convenience Stores, Hypermarket/Supermarket, E-Retailers & Specialty Stores), and Regional Insights and Forecast to 2033

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LACTOSE FREE YOGURT MARKET OVERVIEW

The global lactose-free yogurt market size was valued at USD 3.6 billion in 2024 and is expected to reach USD 3.87 billion in 2025, progressing steadily to USD 6.88 billion by 2033, exhibiting a CAGR of 7.46% over the forecast period.

Yogurt without lactose is a healthier version of yogurt in that it is produced after processing of the regular milk or yogurt to remove lactose, the sugar that is available in milk. Lactose-free yogurt is prepared by adding lactase into the yogurt producing stage where the enzyme facilitates the breakdown of lactose. By doing so, it is possible to convert most of the lactose into simple non digestive sugars that do not contain lactose and can be easily absorbed by lactose intolerant individuals.

There are various factors driving the lactose free yogurt market growth such as, growing awareness of lactose intolerance and the digestive issues and growing trend of dairy-free and plant-based diets. The growing awareness of lactose intolerance and the tendency of consumers to look for easy to digest food is projected to boost the demand for lactose-free yogurt in both developed and emerging markets. B2B companies in the Dairy industry are expected to concentrate on research and development, launching new product variations, accents on the design and addition of benefits like vitamins and probiotics that will enable further expansion of the market.

KEY FINDINGS

COVID-19 IMPACT

Pandemic Heightened Global Awareness About Health and Immunity Resulted in Increased Demand

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 fact that the COVID-19 pandemic hit everyone globally resulted in a concern for health and immunity among everyone and hence the increase in the introduction of more health-focused food products such as lactose-free yogurt. There were many health-conscious consumers looking for food with a probiotic effect hence lactose-free and probiotic yogurt gained high acceptance. The increasing use of technology especially in e-commerce where foods are delivered to one’s doorstep together with the health benefits of the foods ingested made more people eat healthy foods and this too has propelled this market. In addition to that, the expansion of the lactose-free yogurt market over the time, both before and after the pandemic, was also facilitated by the increasing number of people who pay attention to the diet and do not tolerate lactose.

LATEST TRENDS

Plant-Based Hybrid Products to Drive Market Growth

The growth of the sector of lactose-free yogurts is also driven by another trend, which is the appearance of hybrids, that is cross-over products. These products combine dairy foods and non-dairy milk types such as almond, coconut, and oat milks to address the needs of the consumers pursuing a healthy diet as well as the conventional ones. This trend aims to respond to individuals who wish to enjoy vegan, non-dairy, lactose-free foods and who are health as well as environmentally conscious. The plant hybrid yogurts also come in various shapes and flavors appealing to different dietary restrictions, which helps expand the market as well as drives continuous growth of the market.

• According to the U.S. National Institutes of Health (NIH), around 68% of the global population has some degree of lactose malabsorption, which has directly influenced the growing trend for lactose-free dairy options, including yogurt
• Based on data from the European Dairy Association (EDA), over 35% of new yogurt product launches in Europe in 2023 featured a lactose-free claim, indicating a shift toward inclusive dairy offerings

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LACTOSE FREE YOGURT MARKET SEGMENTATION

By Type

Based on Type, the global market can be categorized into Conventional & Organic.

• Conventional: It is made from actual dairy products with lactose removed or, in most cases, broken down by the action of lactase enzymes. This segment holds the major share of the market, owing to its easy access, cost effectiveness, and the fact that it is the first product for lactose intolerant individuals who seek milk and milk-based products.

• Organic: Organic production methods are used which means that milk is obtained from cows who are being nourished with organic feed without the use of any chemical pesticides, or hormones. This segment is gaining traction as consumer health awareness and concern for the environment increases and people seek organic and natural products.

By Application

Based on application, the global market can be categorized into Convenience Stores, Hypermarket/Supermarket, E-Retailers & Specialty Stores.

• Convenience Stores: Convenience stores offer quick access to lactose-free yogurt for consumers seeking a fast, on-the-go snack. This channel benefits from high foot traffic and convenience, catering to impulse buys and busy shoppers.

• Hypermarket/Supermarket: In hypermarkets and supermarkets, a plethora of lactose-free yogurt options are available for consumers in a variety of brands, flavors, and types. This channel remains one of the largest for product distribution owing to the preference of the consumers for shopping under a single roof.

• E-Retailers: Online retail platforms are increasingly popular for purchasing lactose-free yogurt, driven by the growth of e-commerce and home delivery services.

• Specialty Stores: Specialty stores, including health food and organic stores, cater to consumers looking for high-quality, niche lactose-free yogurt products.

MARKET DYNAMICS

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

Driving Factors

Growing Awareness of Lactose Intolerance to Boost the Market

A factor in the lactose free yogurt market growth is the growing awareness of lactose intolerance. In light of the fact that lactose intolerance has gained popularity in the maze of the general public, many businesses have come up with lactose-free alternatives. As a result of this awareness, lactose free yogurt is gaining popularity as more and more consumers are looking for easily digestible dairy products. The rise in the demand for consumption of healthy food together with the need to provide people who are lactose intolerant with suitable food has been the significant factors contributing to the expansion of the market.

• According to the Food and Agriculture Organization (FAO), approximately 70% of adults in Asia are lactose intolerant, driving substantial demand for lactose-free yogurt in Asian markets
• The Canadian Digestive Health Foundation (CDHF) reports that over 7 million Canadians actively seek lactose-free products due to digestive sensitivity, supporting higher adoption rates of lactose-free yogurt in North America

Growing Trend of Dairy-free and Plant-based Diets to Expand the Market

The growing trend of dairy-free and plant-based diets is another key aspect of the lactose free yogurt market. The rising number of population switching to plant-based diets for health, environmental or ethical reasons has led to the growing market for dairy-free and lactose intolerant products. For example, many lactose intolerant consumers who would like to eat yogurt may find lactose free yogurt to be ideal. There’s a growth in the number of vegetarianism practices mostly due to an increase in creativity as many companies have approached the manufacture of dairy and dairy-free mixes creating more varieties that have in turn fueled the growth of the market.

Restraining Factor

Competition from Other Alternatives to Potentially Impede Market Growth

A restraining element within the growth of the lactose free yogurt market is the competition from other alternatives. Due to the increasing availability of plant based products like almond, coconut and soy yoghurts and other dairy free snacks and drinks, there are plenty of options for the consumers to explore. This wide variety of alternatives can hinder the market for lactose-free yogurt because some consumers might choose to avoid the yogurt altogether due to the available different taste or health option that they prefer more.

• According to the U.S. Department of Agriculture (USDA), the average retail price of lactose-free yogurt can be 20%–30% higher than regular yogurt, which limits its accessibility for lower-income consumer groups
• The European Food Safety Authority (EFSA) highlights that about 15% of consumers perceive lactose-free dairy alternatives as having inferior taste and texture, which affects repeat purchase rates

Flavoured and Specialty Options in Yogurt To Create Opportunity for the Product in the Market

Opportunity

The possibility of incorporating different flavours of lactose-free yogurt and also the plain options is being a major factor that is contributing to the growth of the market. The diversifying customer base and the need for tasting something different has increased the demand for flavoured lactose free yogurts, for instance, fruit flavoured chocolate or yogurt with other exotic flavours. In addition, specialist alternatives such as high-protein, low-sugar or keto-friendly lactose free yogurts provide options for different types of diets thus increasing the number of consumers. Changes in taste and the ability to personalise products increases the demand for these products among the health-conscious people and even in the regular and the specialty markets.

• According to the Australian Department of Health, more than 4 million Australians are diagnosed with lactose intolerance, opening growth opportunities for local and imported lactose-free yogurt brands
• The International Dairy Federation (IDF) estimates that plant-based yogurt alternatives combined with lactose-free formulations have increased by 25% in product innovation pipelines globally

Higher Production Costs Could Be a Potential Challenge for Consumers

Challenge

Due to their associated costs, lactose free yogurts can be a challenge to both producers and consumers. Most of the methods that are used to eliminate lactose or in the case of plant derived ingredients employed instead of lactose, all sucralose, tend to be more expensive than the normal production of yogurt. These costs may lead to elevated shelf prices, resulting in a situation where some customers are unable to afford lactose intolerant yogurt. Furthermore, cost associated factors may limit market development in growth regions that are predominantly price sensitive which may limit the adoption of lactose free technologies among the targeted populations, and curtail the growth of the overall market.

• According to the UK Food Standards Agency (FSA), around 10% of lactose-free yogurt samples tested failed to meet strict labeling standards, creating regulatory hurdles for manufacturers
• The U.S. Food and Drug Administration (FDA) notes that about 12% of lactose-free yogurt products tested had trace levels of lactose, presenting challenges for producers in maintaining complete lactose removal

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LACTOSE FREE YOGURT MARKET REGIONAL INSIGHTS

• North America

In the North American region, the lactose free yogurt market is on the rise. Availability of lactose free products has been on the increase owing to the increasing understanding of lactose intolerance and an ever-growing health conscious eating population. In addition, there is a strong demand from the already existing consumer segmentation in the United States Lactose Free Yogurt Market looking for dairy free and plant based diet options. Most of the stores and online platforms also have a range of lactose free yoghurts suitable for various diets. Such consumer-oriented support is further strengthened by a good level of knowledge among consumers regarding the advantages of a diet devoid of lactose.

• Europe

The global lactose-free yogurt market is predominantly driven and situated in Europe as the cases of lactose intolerant populations in countries such as Germany, the UK, and France continue on the rise. Besides, these consumers have also begun accepting plant-based organic diets which in turn increases the consumption for lactose-free and organic and non-dairy yogurt. Meanwhile healthy eating patterns and the rise in the consumption of clean labels are some of the other major drivers to this Market. European retailers are now launching different flavours and formats of lactose-free yogurts to cater to the target audience.

• Asia

The lactose-free yogurt market is growing in Asia as education on lactose intolerance rises as well as disposable income levels. Japan, China, and India primarily abstain from dairy products since they can be easily replaced with healthier and more easily digested options. The popularity of these products is also facilitated by health trends that encourage the use of functional foods, and an increase in the amount of Western culture, which includes cuisines that have such products as part of them. Nevertheless, cultural dietary practices, as well as regional taste preferences for dairy products, may affect the pace of uptake in certain regions.

KEY INDUSTRY PLAYERS

Key Industry Players Shaping the Market Through Innovation and Market Expansion

The lactose-free yogurt market is growing quickly due to Anthony’s key industry players and their market expansion initiatives. New products are being launched by major players looking to satisfy shifting consumer demands in flavours, plant based hybrid variants and functional ingredients, such as probiotics and vitamins. Their revenues are also on the rise as these and many other firms seek to grow their market share through strategic alliances, acquisitions and expanding distribution to economically active emerging markets. In addition to that, smaller, younger and more creative brands are turning to clean-labelled, organic and niche products, which position the market in a healthy manner across the globe.

• Chr. Hansen Holding A/S (Denmark): According to Chr. Hansen’s Sustainability Report, the company’s patented probiotic cultures have enabled over 200 lactose-free yogurt product formulations worldwide
• Yakult Honsha Co.: As per the Japan Dairy Association, Yakult Honsha produced over 50 million liters of lactose-free probiotic yogurt in 2023, expanding its market share in Asia-Pacific lactose-free dairy

List of Top Lactose-Free Yogurt Companies

• Chr. Hansen Holding A/S (Denmark)
• Yakult Honsha Co., Ltd (Japan)
• Nestlé SA (Switzerland)
• DuPont (U.S.)
• MORINAGA & CO., L.T.D. (Japan)
• BioGaia AB (Sweden)
• Protexin (U.K.)
• Daflorn Probiotics UK (U.K.)
• Danone (France)
• Yakult U.S.A. Inc. (U.S.)
• Deerland Enzymes, Inc. (U.S.)
• Goerlich Pharma GmbH (Germany)
• SANZYME BIOLOGICS PVT. LTD. (India)
• DSM (Netherlands)
• NutraScience Labs (U.S.)
• Kerry Group plc (Ireland)
• Lallemand Inc. (Canada)
• Lonza (Switzerland)
• Winclove Probiotics (Netherlands)
• Probi (Sweden)

KEY INDUSTRY DEVELOPMENT

October 2021: Yogurtland will roll out its first oat milk-based vegan Lactose-free yoghurt flavour, "Lactose-free Cinnamon Oatmeal Cookie," across participating locations. This addition came just in time following the launch of its Lactose-free Salted Chocolate Soufflé flavoured Lactose-free yoghurt in January 2020, followed by the relaunch of its coconut milk-based flavour due to consumer demand.

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 lactose free yogurt market is poised for a continued boom pushed by growing awareness of lactose intolerance and the digestive issues and growing trend of dairy-free and plant-based diets. Despite challenges, which include high production cost of lactose free yogurt. Key industry players are advancing via technological upgrades and strategic marketplace growth, enhancing the supply and attraction of lactose free yogurt. As customer choices shift towards plant based options, the lactose free yogurt market is expected to thrive, with persistent innovation and a broader reputation fueling its destiny prospects.