The U.S. Dairy Exporter Blog: Market Analysis, Research & News

  • Three Global Consumer Groups Driving Demand for Whey Protein

    By Mark O'Keefe February 6, 2017

    U.S. exports of whey are up and some suppliers are increasing plant capacity to meet global demand for more protein.

    U.S. whey exports are up across the board, thanks in part to three consumer groups eager for more protein-powered energy.

    The U.S. Dairy Export Council's latest monthly trade data report documents the surge in whey exports.

    In the second half of 2016 through November, total whey exports were up 32% from the same period in 2015, with a 47% gain in November alone, wrote USDEC's Al Levitt. "More than half of the November sales went to China, which posted a new high of 24,130 tons, up 147% from a year earlier. Nearly 15,000 tons of that volume was WPC, also a record high. Meanwhile, sales to Southeast Asia were up 63% year-over-year."

    U.S. Whey Exports Up Chart.png

    USDEC projects that the global whey trade will grow 4.6% annually through 2021, which should generate more than 400,000 metric tons of additional whey sales in 2021 compared to 2016.

    Underlying that optimism is the growing demand for whey protein concentrate and whey protein isolate in meeting the nutritional needs of consumers. This is an exciting component within the total whey picture, and forms the basis for the following discussion.      

    Three demographic groups driving global demand

    Kristi Saitama, vice president of export marketing ingredients at the U.S. Dairy Export Council, sees three demographic groups driving global demand, each presenting export opportunities in identifiable markets.  

    Those groups are:

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    1. Health-conscious adults and seniors. In countries such as Japan, South Korea and the eastern seaboard of China (including the cities of Beijing, Shanghai and Guangzhou), there are growth opportunities for mainstream health-and-wellness food and beverage products and healthy-aging-oriented food and beverage products with whey proteins. It should be noted that the United States also falls into this category. 

    According to United Nations' projections, the number of people over 65 worldwide will triple from 530 million in 2010 to more than 1.5 billion in 2050. This is an opportunity for whey protein because it can reduce the risk of sarcopenia, the age-related loss of muscle mass and strength. Read “Global Boom of 65+ Population Opens Door for U.S. Whey Protein.”  

    China200-1.jpg2. Infants and toddlers. In countries such as China, Vietnam and Saudi Arabia, there is growth potential for whey protein use in child nutrition formulas. Singapore is also included because it serves as a production base for child nutrition products to Southeast Asia. While breast-feeding remains a preferred method of infant feeding, dairy protein can play an important role in the overall child nutrition picture. 

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    3. Middle-class fitness enthusiasts. Ripe opportunities exist in countries with a rising middle class where the sports nutrition market is relatively small now, but ready for take off. In China, Southeast Asia and the Gulf Cooperation Council nations in the Middle East, there is potential for whey protein sports nutrition powders and energy/nutrition type products for sports- and fitness-inclined consumers. The benefits of whey protein for athletes are well documented. Read "Proof That Whey Protein Really is the Best for Building Muscle" and this research summary supporting the role of dairy products for athletes.

    U.S. plant expansions increase capacity for whey exports

    Some U.S. dairy exporters are placing bets on whey by expanding their plants or building new ones.

    The Hilmar Cheese Company's flagship facility in Hilmar, California, is the largest single-site whey and cheese operation in the world, points out Gwen Bargetzi, director of marketing communications. And its Dalhart, Texas, facility is nearing the production capacity of the Hilmar plant. The newest addition, a milk powder facility in Turlock, Calif., "contributes to our heft in the global whey market by enabling us to offer portfolio of dairy products for stronger customer partnerships," she adds. 

    "Our product line includes robust whey proteins designed for the UHT drinks that help emerging markets become familiar with whey. We also offer high-end fractions like lactoferrin and alpha-lactalbumin for special infant formulas in China, and whey isolates for the clear drinks so popular with elite athletes preparing for the next Olympics," Bargetzi said. 

    "We’re excited about the global growth opportunity for whey protein," she adds. "People don’t see whey as a cheap source of protein, they see it as an efficient food. That’s an outstanding opportunity for us to deliver whey proteins that provide function and nutrition." 

    Swiss Valley Farms, named the 2016 Exporter of the Year by Dairy Foods magazine, is similiarly bullish on whey.

    Growth in the whey market was one reason Swiss Valley expanded its cheese production facility in Luana, Iowa, by 49,000 square feet—to the tune of $20.6 million. The plant will produce more cheese, which will significantly add more whey available to be exported and sold domestically, says Swiss Valley CEO Chris Hoeger.

    Global consumers drawn to energy-boosting snacks with whey protein 

    “Consumers are embracing protein powders as an easily added high-quality protein source for products,” said Kara McDonald, vice president of global marketing communications at the U.S. Dairy Export Council. “In fact, 60% of
    consumers seek snacks they can draw on immediately for energy. Using dairy very strawberrry protein cookies5.jpgproteins to create snacks such as sports drinks, smoothies and bars promotes all-day protein consumption. Dairy proteins can also be added to soups and baked goods.”

    Growing interest in whey protein can be seen in the popularity of online recipes, both domestically and globally. Consider, for example, very strawberry protein cookies and protein ice cream. The social media site Pinterest has a shareable board featuring whey protein recipes, visually displayed.  

    Product proliferation

    Around the world, people are finding thousands of ways to use whey protein in their products. 

    As reported in USDEC's Dairy Spotlight, the number of new product launches tracked globally with whey protein rose to nearly 6,000 in 2015, according to Innova Market Insights. And the pace of the launches is accelerating, growing at a 34% compound annual growth rate between 2010 and 2015 compared to 6% between 2005 and 2009.

    Global competition is keen to take advantage of these trends. But U.S. dairy exporters are positioning themselves to meet the growing worldwide demand. .

    Mark O'Keefe is vice president of editorial services at the U.S. Dairy Export Council.

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    The U.S. Dairy Export Council fosters collaborative industry partnerships with processors, trading companies and others to enhance global demand for U.S. dairy products and ingredients. USDEC is primarily supported by Dairy Management Inc. through the dairy farmer checkoff. How to republish this post.   

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