Dairy Industry Positioned to Win as Consumer Protein Demand Reaches Record Levels

## Growing Appetite for Protein Creates Multi-Year Opportunity for Dairy American consumers are embracing protein like never before, and the dairy industry stands uniquely positioned to capitalize on this trend, according to a [new report from CoBank's Knowledge Exchange](https://www.cobank.com/knowledge-exchange/dairy/dairy-poised-to-help-meet-consumers-growing-demand-for-protein). With 70% of consumers actively seeking more protein in their diets and updated federal dietary guidelines recommending higher intake levels, dairy producers and processors are entering what industry leaders are calling a "new era" of opportunity. The CoBank analysis, authored by lead dairy economist Corey Geiger and senior food and beverage analyst Billy Roberts, highlights how protein has become the defining nutrient of the decade. Consumer interest has climbed steadily from 59% in 2022 to 67% in 2023 and now 70% in 2025, according to data from the International Food Information Council. "Dairy was made for this opportunity," said Michael Dykes, president and CEO of the International Dairy Foods Association, addressing more than 1,200 industry leaders at the 2026 IDFA Dairy Forum in Palm Springs. "We have momentum on our back. We're in a new era for dairy." ## Updated Dietary Guidelines Boost Protein Recommendations The 2025-2030 U.S. Dietary Guidelines for Americans have significantly increased recommended daily protein intake from 0.8 grams to 1.2-1.6 grams per kilogram of body weight. For a 165-pound person, this translates to consuming 90-120 grams of protein daily, compared to the previous recommendation of approximately 60 grams. This regulatory shift provides tailwinds for dairy products, which offer complete protein containing all nine essential amino acids. Traditional dairy products are naturally protein-rich: cheddar cheese provides 7 grams per ounce, mozzarella delivers 8 grams per ounce, and Greek yogurt has become a staple for protein-conscious consumers. The CoBank report notes that four of the top 10 protein products by absolute unit sales growth over the past year were dairy products, including cheese, cottage cheese, and yogurt, according to data from Circana and Dairy Management Inc. ## Ready-to-Drink Protein Shakes Lead Category Growth The ready-to-drink dairy shake category has emerged as a standout performer, growing 71% over four years with sales jumping from $4.7 billion to $8.1 billion, according to Circana data. New product launches continue to drive innovation, including Nurri (offering 30g protein per serving), reformulated Muscle Milk with ultrafiltered milk, and Propel fitness water with 20g of protein. Major foodservice chains are also capitalizing on the trend. Starbucks has introduced coffee beverages with 22g of protein plus 5g of prebiotic fiber, while Dunkin' launched Protein Milk in January 2025. Cargill's 2025 Protein Profile found that "good source of protein" has become the number one criterion Americans use to define healthy food, with 57% of nutrition label readers specifically checking for protein content. High-protein diets remain the most popular eating pattern for the third consecutive year, with 23% of Americans following such a diet. ## An $800 Billion Industry Enters New Era The scale of the U.S. dairy industry continues to expand. Speaking at the IDFA Dairy Forum, Dykes outlined the sector's impact: nearly $800 billion in economic development, 3 million jobs sustained, more than 24,000 dairy farms, and over 1,200 processing facilities producing products for global markets. [Karen Bohnert, writing for Dairy Herd Management](https://www.dairyherd.com/news/business/idfa-president-outlines-top-5-priorities-800b-dairy-industrys-future), reported that Dykes characterized 2025 as one of the greatest years in history for American dairy. Per capita consumption reached a phenomenal 651 pounds per person, driven by focus on health and wellness. At retail, dairy topped all categories at $80 billion, while the processing sector invested $11 billion in over 50 new state-of-the-art facilities across 20 states. Exports surged to $9 billion despite geopolitical volatility, demonstrating the world's growing appetite for U.S. dairy products. ## Protein Poised to Lead Milk Checks The CoBank analysis indicates that protein is positioned for an extended bull market and will be the leading driver of milk checks in coming years. This represents a shift from recent years when butterfat commanded premium prices. U.S. milk is increasingly "component-laden," with record-breaking butterfat and protein levels. However, the protein-to-fat ratio imbalance creates challenges for U.S. cheesemakers competing against European Union and New Zealand producers. Some processors have begun capping butterfat payments as that component moves toward oversupply. Dykes projected an additional 27 billion pounds of milk production by 2034, stating, "If there is a market signal for milk, the American farmer will come through." ## GLP-1 Medications Reshape Protein Demand The report identifies GLP-1 weight loss medications as a structural shift in protein consumption patterns. According to a November 2025 KFF poll, 12% of adults are now taking these medications, and users are shifting spending toward high-protein dairy products. With pill forms launching in 2025 expected to increase usage further, this trend shows no signs of slowing. Danone has reported double-digit growth in high-protein Greek yogurt sales attributed partly to GLP-1 medication users seeking smaller, protein-dense meals. ## Five Priorities for Industry Future Dykes outlined five core strategies under the theme "United to Win" for securing the dairy industry's future: **Reclaim the Health Halo:** Dairy is the "original functional food." Legislative wins including the Whole Milk for Healthy Kids Act brought 2% and whole milk back to school cafeterias. By proactively reducing sugars and removing artificial colors, the industry has increased consumer perception of dairy as a healthy lifestyle staple by five percentage points in a single year. **Secure New Markets:** While Mexico remains a primary export partner, industry leaders are targeting Southeast Asia and Indonesia for growth. The focus has shifted to leveraging American milk's record-breaking component levels. **Maximize Efficiency with Technology:** From AI-powered smart collars monitoring cow health to robotic milkers increasing production, technology enables the U.S. to produce 226 billion pounds of milk with 9 million cows. A less efficient system would require 61 million cows to match that output. This efficiency underpins dairy's sustainability story as the industry works toward greenhouse gas neutrality by 2050. **Invest in People and Community:** Workforce challenges and immigration reform remain paramount. IDFA's NextGen and Women in Dairy programs serve as engines for future leadership. Since 2022, the IDFA Foundation and its members have served over 1 million meals to food-insecure families. **Protect the Freedom to Operate:** A unified policy voice is essential for fighting "ultra-processed" labels and protecting dairy's place in SNAP and WIC programs. ## Global Dairy Protein Market Expanding The global dairy protein market reflects similar growth trends. Market analysts project the sector at approximately $13-15 billion in 2024-2025, growing at a 5-6% compound annual growth rate to reach $19-25 billion by 2030-2034, according to research from Straits Research, Grand View Research, and IMARC Group. Whey protein continues to hold the largest market share due to its fast absorption for post-workout recovery and high solubility for ready-to-drink beverages. Casein, comprising 80% of milk protein, is growing at the fastest rate as consumers recognize its benefits for satiety and overnight muscle recovery. ## Investment Signals Confidence The $11 billion invested in dairy processing capacity signals long-term industry confidence. With $10 billion in additional dairy plant investment expected to come online through 2028, processors are clearly betting on sustained protein demand. "Leadership rises at times like this," Dykes concluded at the IDFA Forum. "I firmly believe our best days are ahead of us because I know the commitment, the passion and the integrity that resides inside this industry." --- **Sources:** CoBank Knowledge Exchange report by Corey Geiger and Billy Roberts; Karen Bohnert, Dairy Herd Management; International Dairy Foods Association; International Food Information Council; Circana; Cargill 2025 Protein Profile; Dairy Management Inc.; Straits Research; Grand View Research; IMARC Group; KFF.