USA Cheese Market Outlook to 2030

USA Cheese Market Overview

• The USA Cheese Market reached USD 45 billion, reflecting strong growth driven by increasing consumer demand for premium and organic cheese products. This growth is also supported by innovations in dairy farming and the expansion of foodservice channels such as restaurants and fast-food chains. Key drivers include the rise of specialty cheeses and a growing preference for natural, clean-label products. The market is set to experience steady expansion through 2028, with notable growth in plant-based cheese alternatives.
• Major players in the market include Kraft Heinz, Dairy Farmers of America, Saputo Inc., Sargento Foods Inc., and Schreiber Foods. These companies dominate the market with their extensive product portfolios, advanced manufacturing capabilities, and wide distribution networks. Their investment in R&D and strategic acquisitions has enabled them to maintain strong market positions and drive product innovation.
• In 2024, Saputo Inc. launched a new line of organic cheese varieties, further expanding its product range to meet growing consumer demand for sustainable and clean-label options. This development highlights the increasing trend toward organic products in the U.S. cheese market and the company's efforts to tap into this rapidly growing segment.
• Cities like New York, California, and Wisconsin lead the USA Cheese Market due to their significant consumer bases and cheese production capacities. Wisconsin, in particular, holds a dominant position as "Americas Dairyland," contributing significantly to overall U.S. cheese production with its advanced farming infrastructure and skilled workforce.

USA Cheese Market Segmentation

The USA Cheese Market can be segmented by various factors, such as type of cheese, distribution channel, and region.

By Cheese Type: The USA Cheese Market is segmented by cheese type into cheddar, mozzarella, cream cheese, and others. In 2023, cheddar cheese held the largest market share due to its versatile applications in foodservice and retail sectors. The widespread use of cheddar in sandwiches, snacks, and cooking ingredients, coupled with its long shelf life, supports its dominant position. Mozzarella follows closely due to its popularity in the pizza industry, particularly in quick-service restaurants.

By Distribution Channel: The USA Cheese Market is divided by distribution channel into supermarkets/hypermarkets, online retail, and specialty stores. In 2023, supermarkets/hypermarkets led the market, accounting for the highest market share. These outlets provide a wide variety of cheese products, from mass-market to premium brands, making them the preferred choice for many consumers. The accessibility of these retail formats, coupled with frequent promotions, contributes to their dominance in the cheese distribution market.

By Region: Regionally, the USA Cheese Market is segmented into North, South, East, and West. The North held the largest market share in 2023 due to Wisconsin's significant contribution to cheese production. Wisconsin alone accounts for nearly half of U.S. cheese production, producing over 600 varieties. The South region is also a key market, driven by the growing consumption of cheese in fast-food chains and the increasing demand for artisanal and gourmet cheeses.

USA Cheese Market Competitive Landscape

• Dairy Farmers of America: Dairy Farmers of America, in 2023, entered into a strategic partnership with Danone North America to supply high-quality cheese to meet the demand for organic and sustainable dairy products. The collaboration will focus on promoting environmentally friendly practices in dairy farming.
• Schreiber Foods: In 2024, Schreiber Foods announced a $59 million investment to expand its beverage plant in Wyoming, Michigan, aiming to boost operational efficiency and meet growing consumer demand. The project will create 32 new jobs, highlighting Schreiber's dedication to enhancing production capacity and addressing the rising need for its beverage products.

USA Cheese Market Analysis

Market Growth Drivers

• Rising Demand for Premium and Artisan Cheese: The demand for premium and artisan cheese in the U.S. has surged, reaching over $6 billion in 2023. Consumers are increasingly opting for high-quality, unique cheeses, particularly among millennials and Generation Z, who show a strong preference for organic and farm-to-table options. The trend is backed by increased sales of specialty cheese products in gourmet stores and online platforms. The Food Industry Association estimates that the consumption of specialty cheese products will grow by 1.3 billion pounds by 2025.
• Expansion of Foodservice Industry: The foodservice industry in the U.S. contributed $3.5 trillion to the economy in 2024, with restaurants, cafes, and fast-food chains accounting for a large portion of the cheese consumption. The increased consumption of cheese as a key ingredient in pizzas, burgers, and sandwiches is driving the demand for both processed and natural cheeses. According to data from the National Restaurant Association, over 12 million tons of cheese are consumed annually in foodservice establishments, contributing to the robust growth in this market segment.
• Growth in Foodservice Sector: The U.S. foodservice industry continues to expand, with restaurants, cafes, and fast-food chains contributing significantly to cheese consumption. In 2024, over 12 million tons of cheese were consumed in the foodservice industry, reinforcing its role as a major growth driver for the market.

USA Cheese Market Challenges

• Volatile Dairy Prices Impacting Production Costs: The volatility in dairy prices continues to pose a challenge for cheese manufacturers. In 2024, milk prices in the U.S. fluctuated between $18 and $25 per hundredweight, driven by supply chain disruptions and high feed costs for dairy cows. As milk is a primary raw material in cheese production, these price hikes significantly increase production costs. According to USDA reports, cheese producers have been forced to raise their prices by $2 per pound in response to rising input costs, impacting the profit margins of smaller cheese manufacturers.
• Labor Shortages in Dairy and Cheese Manufacturing: In 2024, the U.S. cheese industry faced a labor shortage of over 100,000 workers, affecting production lines, farm labor, and distribution. With rising wages and difficulties in retaining skilled labor, cheese manufacturers are forced to automate many of their processes, increasing capital expenditure. The Bureau of Labor Statistics (BLS) reports that wages for dairy and cheese production workers rose by $4 per hour between 2022 and 2024.

USA Cheese Market Government Initiatives

• USDA Dairy Margin Coverage (DMC) Program: In 2024, the USDA expanded its Dairy Margin Coverage (DMC) Program, offering financial protection to U.S. dairy producers when the margin between the price of milk and the cost of feed falls below a certain level. The program has seen a 20% increase in participation in 2024, supporting farmers and helping stabilize milk prices, which in turn affects cheese production costs. The program aims to alleviate price volatility in the cheese market by reducing the financial burden on dairy producers.
• Dairy Margin Coverage Program: Supporting Dairy Farmers and Cheese Production: The Dairy Margin Coverage (DMC) Program offers financial protection to U.S. dairy farmers when milk and feed cost margins fall below a specific threshold. By stabilizing farmer incomes, it ensures a consistent milk supply crucial for cheese production. Increased participation highlights its effectiveness in mitigating price volatility in the dairy industry.

USA Cheese Market Future Market Outlook

The USA Cheese Market is set for steady growth, driven by rising consumer demand for specialty cheeses, increased adoption of plant-based cheese alternatives, and technological advancements in production processes. The market will continue to benefit from evolving consumer preferences and growing demand in foodservice and retail sectors.

Future Market Trends

• Technological Advancements in Cheese Production By 2028, advancements in automation and dairy farming technology are expected to revolutionize cheese production, with a focus on precision agriculture. Automation in production facilities will enhance efficiency, reduce labor costs, and ensure consistent product quality. In 2024, over 15% of U.S. cheese plants adopted advanced automation technologies. By 2028, this number is projected to surpass 30%, significantly increasing production capacity and reducing operational costs for cheese manufacturers.
• Expansion of Plant-Based Cheese Market The plant-based cheese market is expected to grow exponentially over the next five years, reaching $5 billion by 2028. As more consumers adopt vegan and flexitarian diets, companies will introduce new varieties of plant-based cheeses with improved taste, texture, and nutritional profiles. The USDA projects that plant-based dairy alternatives will represent 20% of the U.S. cheese market by 2028, driven by both health-conscious consumers and environmental concerns.