‘Strategic business opportunity’: Snapshot into rising popularity of dairy permeate to enrich baked goods and snacks

By Gill Hyslop contact

- Last updated on GMT

Dairy permeate will add nutritional benefits and enhance the flavour - without adding sodium - of baked goods and snacks. Pic: GettyImages/Samuel Garces
Dairy permeate will add nutritional benefits and enhance the flavour - without adding sodium - of baked goods and snacks. Pic: GettyImages/Samuel Garces

Related tags: US Dairy Export Council, dairy permeate, Fortification, Innova market insights

Enhancing products with dairy permeate is gaining traction, especially in the bakery sector, with one in four bakery products launched last year containing the high-lactose, mineral rich ingredient, according to the US Dairy Export Council (USDEC).

Permeate – labelled as dairy product solids – is produced through an ultra-filtration process to separate the milk sugar (lactose), protein and other solids from milk or whey. Fresh milk companies then adjust the permeate that is added back to milk to ensure consumers receive a product that is of a consistent quality and taste.

Permeate is also used by various other sectors of the F&B industry to boost the mineral content, improve browning or enhance the salty flavour of a product while reducing the sodium content.

During a webinar for Chinese food and beverage manufacturers, the USDEC reported that globally, new product introductions containing permeate have climbed sharply over the past decade, with bakery leading the pack with 28.2% permeate-enriched NPDs in 2019.

‘Aligned with trends’

Bakery and snacks with permeate
UDEC/Innova Market Insights

“The global trends show why permeate is a strategic business opportunity for product formulators looking for functionality and value,”​ said Annie Bienvenue, VP of global ingredients technical marketing services for USDEC.

“It’s aligned with consumer and category trends, leaves room for even more potential and limitless opportunities in China as a market completely new to permeate in food applications, alongside other growth markets for permeate around the world.”

According to an analysis of tracking data from the Innova Market Insights’ Innova Database, NPDs containing permeate reached an all-time high of 531 products last year – up 11% from the year prior and double the number of introductions in 2015.

Innova’s tracking data further revealed permeate usage is expanding and diversifying globally, with North America and Western Europe accounting for 50% market share and the rest of the world the remaining half, especially in Latin America, Asia and the Middle East.

The US is the leading permeate producer with an estimated volume of 523,200 metric tons last year and also leads the way with permeate-enriched NPDs launches, followed by Brazil, UK, France and the Philippines.

‘Attractive ingredient solution’

Top 5 cateogries for permeate
UDEC/Innova Market Insights

Adding permeate is fast becoming a popular way to boost a baked good’s flavour and nutritional value, recording a 17% CAGR from 2015 to 2019. These include cookies, breads, muffins, crackers and toaster pastries.

It is also being picked up by  confectionery sector – 15.1% of permeate-enhanced NPDs were launched in 2019 – followed by beverages (12.4%), dairy foods (12.2%) and the snacks industry. 7.7% of the NPDs launched last year were fortified with permeate.

Snacks – including corn, rice and potato-based snacks – are an emerging and promising category with a sharp upward trajectory over the past five years recording a 93% CAGR from 2015 to 2019, according to Innova’s data.

“US suppliers have invested in research and development efforts to optimise permeate flavour and functionality in a variety of food and beverage applications and can also provide customers with technical and new product ideation support as delivered through the recent webinar in China,”​ said Kristi Saitama, VP of global ingredients marketing for USDEC.

“We are excited that the world increasingly sees permeate as an attractive ingredient solution, and look forward to customers’ new creations.”

The US Dairy Export Council is a non-profit that represents the global trade interests of US dairy industry. The organisation also works directly with global buyers and end-users to accelerate innovation using US dairy products and ingredients.

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