Lactose-Free Infant Formula Market Analysis Report By Product, By Distribution Channel, By Region And Segment Forecasts From 2019 To 2025

Industry Insights

The lactose-free infant formula market size was accounted for USD 11.9 billion, in 2018 and is projected to grow at a CAGR of 10.6% from 2019 to 2025. The rise in the population of lactose intolerant babies along with the increasing population of working women is surging the market demand. Additionally, newborn babies’ inability to digest sugar elements is increasing over the years. The growing need for substitutes to support nutritional demand is projected to increase the market growth.

According to the World Health Organization (WHO), the maximum nutritional benefits to infants are provided through breastfeeding. Moreover, the growing lactose intolerance among infants and lack of time from working women is encouraging manufacturers to invest in the research and development to enhance the nutritional quality of the product.

For example, Valio Oy has launched over 100 products of lactose-free infant formula in more than 50 countries across the globe. In 2016, the company spends about USD 28 million on new product development. According to the study of the National Library of Medicine, 65% population is tolerant of lactose. This is more common in Finland, wherein one in every 60,000 newborns is affected with lactose intolerance.

The lactose intolerance conditions are lower in the individuals that are dependent on unfermented milk products as their food source. For example, around 5% of North Europeans go through this ailment. Moreover, there has been no cure to this condition; this has increased the demand for lactose-free infant products, thereby driving the lactose-free infant formula market growth. 

Product Insights

In 2018, the Organic formula held the largest market share of over 60.0% in the overall market. Consumer preference has shifted towards buying premium, and high-quality products for the better nutrition of infants. Moreover, these products are certified by the government with quality checks. The awareness about the harmful effects of chemically synthesized products is increasing among consumers. These factors are expected to boost productivity growth in the forecast period.

The demand for conventional products is highest in the Asia Pacific, and Middle East & Africa regions, especially in developing countries such as China and India. The lactose infant formula for the conventional product is effective and price sensitive as it helps in treating diarrhea among infants. Owing to these factors, the manufacturers in the market focus on developing innovative products to meet consumer demand. For instance, Abbott offers high nutrition enriched soy-based lactose infant formula. 

Distribution Channel Insights

The distribution channels are bifurcated into supermarkets and hypermarkets, convenience stores, and online. In 2018, supermarkets & hypermarkets held the largest lactose-free infant formula market share of over 45.0% in the global market owing to the availability of a large variety of products with multiple options such as authenticity, scanning of the product. The increasing promotional and advertisement campaigns have surged the sales of the segment. Further, the organized retail sector is growing rapidly because of an increasing number of local brands in the market.

The online channel is projected to grow at the fastest CAGR of 11.3% during the forecast period. Increasing penetration of digital or e-commerce is one of the main reasons for the rise in the online sector. Consumers are more inclined towards online services due to the offering such as doorstep delivery, coupons, and others. These factors are propelling the demand for lactose-free infant formula category. The convenience stores segment is projected to grow at a significant rate in the forecast period, from 2019 to 2025. 

Regional Insights

In 2018, Europe held the largest market share of 37.5% in the overall market. The presence of a large number of lactose-intolerant individuals is a key factor driving the market growth. The region has the highest number of manufactures of lactose-free dairy products in the world. Europe produced a lactose-free dairy product of over 60 million metric tons, in 2018.

Central & South America is projected to grow at the highest CAGR of 11.5% from 2019 to 2025. The growing disposable income levels, especially in developing countries such as Brazil, and Argentina are spurring market growth. 

Lactose-Free Infant Formula Market Share Insights

Leading players in the market include Nestlé; Abbott; Nutricia; GIMME THE GOOD STUFF; Valio Oy; Danone; Silverson; Nurture, Inc.; and Apta Advice. Top players in the market focus on product innovations to meet customer demand.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from, 2015 to 2025. For the purpose of this study, Million Insights has segmented the global Lactose-Free Infant Formula Market report on the basis of product, distribution channel, and region:

• Product Outlook (Revenue, USD Billion, 2015 - 2025)
    • Organic
    • Conventional

• Distribution Channel Outlook (Revenue, USD Billion, 2015 - 2025)
    • Hypermarkets & Supermarkets
    • Convenience Stores
    • Online

• Regional Outlook (Revenue, USD Billion, 2015 - 2025)
    • North America
        • U.S.
        • Canada
        • Mexico
    • Europe
        • Germany
        • U.K.
    • The Asia Pacific
        • China
    • Central & South America
        • Brazil
    • Middle East & Africa (MEA)