Ultra pasteurized Cream Market Size, Share & COVID-19 Impact Analysis, By Source (Dairy and Non-dairy), By Type (Fresh Cream, Whipping Cream, Sour Cream, Others), By Application (Commercial and Household), and Regional Forecast, 2021-2028

The global ultra pasteurized cream market size was USD 7.66 billion in 2020. The market is projected to grow from USD 7.82 billion in 2021 to USD 10.40 billion in 2028 at a CAGR of 4.15% during the 2021-2028 period. Europe dominated the ultra pasteurized cream market with a market share of 31.33% in 2020.

The global impact of COVID-19 has been unprecedented and staggering, with ultra-pasteurized cream witnessing a negative impact on demand across all regions amid the pandemic. Based on our analysis, the global market exhibited a lower growth of 1.83% in 2020 as compared to the average year-on-year growth during 2017-2019. The rise in CAGR is attributable to this market’s growth and demand, returning to pre-pandemic levels once the pandemic is over.

The growing demand for cream-filled and decorated desserts such as cakes, pastries, and puddings has fueled innovations and new product developments in the dairy sector. The increasing demand for such indulgent products has led to the increased utilization of dairy cream in the foodservice sector. The rising demand for dairy creams with longer shelf life mainly drives the growth of the global market. The ultra-pasteurization treatment uses extra-high temperatures to eliminate all pathogens responsible for milk spoilage, extending the product's shelf life.

Ultra-pasteurized cream is treated at 280 degrees only for 2 seconds and then chilled, which gives it a longer shelf life when unopened. The higher temperature kills the typical bacteria such as E. coli and salmonella and atypical bacteria that can cause spoilage. Ultra-heat Treatment (UHT) pasteurization imparts added stabilization to milk cream in various preparations. The increasing demand for vegan products due to their positive health attributes and rising animal welfare concerns surges the demand for non-dairy ultra-pasteurized creams in the food industry. Convenience, extended shelf life, and low preservation investment provided by the product are expected to fuel the market growth in the foreseeable years.

COVID-19 IMPACT

Market to Exhibit Low Growth Due to Closure of Hotel, Restaurant, Cafe (HORECA) amid COVID-19

The COVID-19 pandemic has severely impacted the food and beverage processing industry. The socio-economic situation has negatively affected the way some products are consumed. The cream industry’s major applications are in functions, ceremonies, and food service restaurants. However, the allowance of only essential occasions led to the shutting down of these restaurants. However, with the gradual relaxation in lockdown norms, the product demand will return to its historical estimates subject to the HORECA segment resuming its normal course of operations.

LATEST TRENDS

Proliferating Demand for Plant-based Dairy Products to Support Market Dynamics

Low-calorie and plant-based dairy ingredients are becoming mainstream as manufacturers continue to incorporate them in their products. The pandemic also encouraged consumers to seek out healthier foods as they link gut health and improved immunity. Consumer expectations have changed beyond dairy allergies and lactose intolerance while young consumers look for tasty yet “ethical” dairy alternatives that are harmless to the planet and animals. UHT cream makers such as Fonterra are trying to broaden out the food’s image by including healthy, plant-based options in their product range to capitalize on this trend, which is expected to create opportunities for the global market.

DRIVING FACTORS

Rising Demand for Shelf-stable Dairy Products Driving Market Growth

In recent years, knowledge regarding the microbial spoilage of dairy products has increased among consumers. People are willing to spend on milk products less susceptible to such spoilages. Ultra-heat pasteurization treatment ensures the removal of the entire pathogenic load from dairy products, thereby increasing their shelf life. The low risk of spoilage and longer shelf life are the key factors that primarily drive the ultra pasteurized cream market growth. The growing demand for shelf-stable dairy creams across the foodservice and bakery sectors further propels the market growth.

Increasing Application Areas of UHT Creams in Cafe and Quick Service Restaurants to Boost Sales

The consumption of fresh, whipped, and heavy creams has increased due to the rising popularity of cafe culture and changing consumer preferences. Quick service restaurants (QSRs) and cafes are the fastest-growing foodservice industry segments, especially in South Asian countries. According to Fonterra’s sale data in 2019, nearly 600 million cups of tea and coffee are consumed outside homes every day in Asia Pacific. The rising demand for coffee has facilitated the growing number of coffee shops and teahouses, beverage kiosks, and dessert bars in Southeast Asia and Vietnam, which is likely to drive market growth. The addition of UHT creams provides great flavor and mouthfeel to coffee, cakes, pastry, and other bakery products, which further drives the market growth. Furthermore, the presence of developing countries, such as China and India, work as a key element in boosting the demand for ultra-pasteurized cream in Asia Pacific, further driving the market growth.

RESTRAINING FACTORS

Taste & Flavor Changes in Cream Due to Ultra Pasteurization Process Hamper Market Growth

Ultraheat treatment generally gives a slightly cooked taste to dairy products such as cream. Taste and flavor are the key factors that impart value to the cream as it is utilized in a range of indulgent beverages and desserts. Ultra-pasteurization also negatively impacts the whipping ability and whipping time of creams. High cost, low flexibility, and adaptability of UHT hamper the market growth.

SEGMENTATION

By Source Analysis

Dairy to be Dominant Source Owing to its High Nutritional Value

The dairy segment dominates the market as it is rich in nutrients and its incorporation in diets will keep people healthy and active. Dairy provides several nutrients that support brain function, including niacin, riboflavin, and vitamin B12. Dairy products are also an excellent source of calcium that helps promote bone health and reduce the risk of fractures. In addition, dairy creams are mostly used in cooking and baking or as a delicious bread spread, providing a unique flavor that is difficult to replicate with products often used as substitutes. 

The non-dairy segment is anticipated to witness substantial growth, owing to its sustainability and increasing demand among lactose-intolerant consumers. Other benefits such as high stability and cost-effectiveness of non-dairy ultra-pasteurized cream, are expected to drive its demand in forthcoming years.

By Type Analysis

Wide Application of Whipped Cream in Bakery and Confectionery to Support Segment Growth

The whipping cream category is expected to dominate the market due to increasing demand for innovative desserts. Whipping cream is widely used for outer decoration in a range of cakes, pastries, and muffins. It makes an ideal filling for doughnuts. Cream produced by ultra-heat treatment ensures longer shelf life of the product, which makes it a perfect ingredient for bakery desserts and confectioneries.

The fresh cream segment is expected to witness growth due to the rising demand for exclusive culinary products. Fresh cream is often used to enhance the taste and flavor of food products such as pizzas, lasagna, and pasta by giving it perfect consistency. Increasing sales of snack items are helping to drive the growth of the ultra-pasteurized fresh cream market. It is also utilized in various beverage preparations, ice-creams, and curries to add thickness and creamy flavor.

The expansion of the foodservice sector in emerging countries, which uses ready-made cream, is expected to further surge the demand for other ultra-pasteurized cream types, including heavy cream and single cream. Further, the rising population in China and India has boosted the popularity of multi-cuisine, thereby increasing the demand for creams.

By Application Analysis

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Increasing Sale of Dairy-based Products from Foodservice Industry to Drive Commercial Segment Growth

The commercial segment is expected to exhibit major growth, owing to the rising demand for food products with exotic flavors in the foodservice industry. Manufacturers widely use ultra-pasteurized cream in their food products due to its texture building, emulsification, and taste sensations. Furthermore, surge in disposable income, changing food habits, and standardizing lifestyles have increased the frequency of dining out, contributing to the growth of this segment.

The household segment is anticipated to see growth due to consumers’ inclination toward experimenting with their culinary skills. The addition of fresh creams to dishes can help in dressing and complementing the food to make it more appetizing. The increasing trend of home cooking instead of dining out and the easy availability of various UHT creams encourage consumers to opt for innovative cooked dishes.

REGIONAL INSIGHTS

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Europe Market to Rise Significantly Attributed by Increasing Trend of Non-dairy Products

The Europe ultra-pasteurized market stood at USD 2.40 billion in 2020 and dominated the global market. Europe is anticipated to witness promising growth due to the emerging trend of plant-based dairy alternatives. The rising demand for low-calorie, non-dairy ice creams, cakes, and other desserts has encouraged manufacturers to utilize ultra-pasteurized plant-based whipped cream in these products. Ultra-pasteurization treatment enables processors to develop this vegan cream with an increased shelf life. Continuously rising demand for healthy desserts in the foodservice industry is fueling the market's growth in several European countries such as Germany, U.K., Russia, France, and others.

North America region accounted for the second-largest ultra pasteurized cream market share in the global market. North America is expected to witness strong growth due to increasing awareness regarding bacterial spoilage of dairy products among consumers. The rising demand for organic and high-quality dairy products, resulting from the healthier perception of such products among consumers, also drives the market growth in the region. There is a growing demand for convenient products that require less investment for preservation. The increasing millennial population and their growing interest in trying various desserts have positively contributed to the market's growth in North America.

In recent years, the demand for bakery and dairy desserts has increased drastically due to improvements in the economic conditions of Asia Pacific’s developing markets. The region is expected to exhibit substantial growth due to the strong demand for ultra-pasteurized cream from the food processing industry and the increasing utilization of assorted dairy-based preparations. The rapidly expanding foodservice sector in the region is expected to drive the market growth.

KEY INDUSTRY PLAYERS

Leading Players to Focus on New Product Launches for Development of Market

The global ultra pasteurized cream market is highly developed with several multinational companies occupying the majority. Land O’ Lakes, Inc., Meijer, Inc., and Dean Foods Company dominate the market. The major market players focus on the health, taste, and packaging of the product to increase their gross margin and consumer reach.

LIST OF KEY COMPANIES PROFILED:

• Land O’ Lakes, Inc. (Minnesota, U.S.)


• Meijer Companies, Ltd. (Michigan, U.S.)


• Rockview Family Farms (California, U.S.)


• The Kroger Co. (Ohio, U.S.)


• Danone S.A. (Saint-Denis, France)


• Dairy Farmers of America (Kansas, U.S.)


• Elle & Vire (Connecticut, U.S.)


• Fonterra Co-operative Group Limited (Auckland, New Zealand)


• The California Milk Advisory Board (California, U.S.)


• Safeway Inc. (California, U.S.)

KEY INDUSTRY DEVELOPMENTS:

• August 2021 –, Westland Co-operative Dairy Co Ltd., a New Zealand-based company and a subsidiary of Yili Group, China’s largest dairy enterprise announced the launch of Yili Pro UHT Whipping Cream in China. Grass-fed milk was used to produce this cream with a consistency suitable for Chinese bakers.


• January 2021 – IMCD Group, a distributor of specialty chemicals and ingredients, launched an ultra-high temperature (UHT) pasteurization laboratory in Indonesia to increase its regional technical footprint. The new lab includes equipment that allows the company to run clinical trials and concentrate on concepts of shelf-stable dairy and non-dairy products.

REPORT COVERAGE

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The research report offers qualitative and quantitative insights into the ultra-pasteurized market. It focuses on significant aspects such as competitive landscape, swot analysis, product type, and product application areas. Besides, it offers insights into the various market trends and highlights vital industry developments. In addition, it encompasses several other factors such as prominent companies’ revenue and growth rate that have contributed to the market’s growth in recent years.

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