Reduced Fat Butter Market - Forecast(2023 - 2028)

Reduced Fat Butter Market Overview

Reduced Fat Butter Market Size is estimated to reach $1.7 billion by 2027. Furthermore, it is poised to grow at a CAGR of 6.2% over the forecast period of 2022-2027. Butter is a dairy product made from churned cream fat and protein components. It contains a high level of saturated fatty acids. Reduced fat butter has low saturated fat, half the calories and cholesterol of butter, no dietary cholesterol and is high in nutrients. Reduced fat butter aids in the reduction of triglyceride. High triglyceride level leads to artery hardening or thickening of the artery walls, increasing the risk of stroke, heart attack, and heart disease, as well as increases the risk of severe pancreatic and liver inflammation. Reduced fat butter spreads contain natural sterols and stanols, which help to prevent cholesterol absorption, making them healthier than regular butter. Reduced fat butter is used in cooking, baking and as spreads. The growing consumption of bakery products, adoption of healthy lifestyle as well as reduced risk of cardiovascular diseases and obesity as compared to regular butter are some of the factors driving the Reduced Fat Butter Industry growth during the forecast period 2022-2027.

Reduced Fat Butter Market Report Coverage

The report: “Reduced Fat Butter Market Forecast (2022-2027)", by Industry ARC covers an in-depth analysis of the following segments of the Reduced Fat Butter Market.

By Form- Spreadable and Non-Spreadable
By Product Type- Salted and Unsalted.
By Application- Household Use and Commercial Use
By Distribution Channel- Supermarket/Hypermarket, Convenience Stores, E-Commerce, Specialty Stores and Others.
By Geography- North America (U.S., Canada, Mexico), Europe (Germany, United Kingdom (U.K.), France, Italy, Spain, Russia, and Rest of Europe), Asia Pacific (China, Japan India, South Korea, Australia, and New Zealand, and Rest of Asia Pacific), South America (Brazil, Argentina, and Rest of South America), and Rest of the World (the Middle East, and Africa).

Key Takeaways

• Geographically, North America held a dominant market share in the year 2021 on account health-conscious people and high purchasing power. Asia-Pacific is expected to offer lucrative growth opportunities to the manufacturers owing to increasing adoption of healthy lifestyle, product launches by companies as well as high prevalence of cardiovascular diseases. The robust growth of unsalted reduced fat butter and e-commerce segment is projected to augment the market growth during the forecast period of 2022-2027.
• Increasing application of reduced fat butter in bakery products and well as growing number of health-conscious people is estimated to propel the market growth. Availability of substitutes offering more heath benefits than reduced fat butter continues to pose threat to the market growth.
• A detailed analysis of strengths, weaknesses, opportunities, and threats will be provided in the Reduced Fat Butter Market Report.

Reduced Fat Butter Market Segmentation Analysis- By Product Type

Reduced Fat Butter Market based on product type can be further segmented into Salted and Unsalted. Unsalted segment held a dominant market share in the year 2021 is estimated to be the fastest-growing, with a CAGR of 5.9% over the forecast period of 2022-2027 owing to its wide application in bakery products. The bakers and chefs don’t have to adjust the salt content of the products depending on the saltiness of the reduced fat butter. Furthermore, unsalted reduced fat butter has very neutral, more pronounced mellow sweetness and creamy flavour, making it a great base for many baked goods. Although unsalted reduced fat butter has a shorter shelf life than salted reduced fat butter, it maximizes freshness and flavour without making baked goods overly salty. The increase in the consumption of bakery products is projected to augment the market growth of unsalted reduced fat butter.

Reduced Fat Butter Market Segmentation Analysis- By Distribution Channel

Reduced Fat Butter Market based on distribution channel can be further segmented into Supermarket/Hypermarket, Convenience Stores, E-Commerce, Specialty Stores and Others. E-Commerce held a dominant market share in the year 2021 and is estimated to be the fastest-growing, with a CAGR of 7.1% over the forecast period of 2022-2027 owing to pandemic restrictions, increasing use of internet as well as smart gadgets as well as growth of online portals and websites including amazon, flipkart, bigbasket and so on. It is estimated that there were 2.14 billion worldwide digital buyers in 2020, and by 2040, 95 percent of all purchases will be made through eCommerce. Governments all around the world implemented social distancing regulations owing to which online shopping witnessed a surge. The growing number of online shoppers increased the demand for advanced customer analytics to boost the revenues. For instance, Walmart introduced an analytical solution for customer data to increase its e-commerce operation which resulted in a 97 percent increase in the company's annual growth in Quarter 2 of 2021. Customers gets to choose from a variety of premium as well as local brands from the comfort of their homes. Furthermore, various offers, discounts and cashbacks running on e-commerce sites is estimated to fuel the market growth.

Reduced Fat Butter Market Segmentation Analysis- By Geography

The Reduced Fat Butter Market based on Geography can be further segmented into North America, Europe, Asia-Pacific, South America, and the Rest of the World. North America held a dominant market share of 34% in the year 2021 as compared to the other counterparts owing to increase in the number of health-conscious people and high consumer purchasing power. According to a USDA Foreign Agricultural Service report, the average Canadian consumed 3.68 kg of butter per capita in 2020, this leads to an increase in regional growth.

However, Asia-Pacific is estimated to be the fastest-growing, with a CAGR of 8.9% over the forecast period of 2022-2027 owing to increasing adoption of healthy lifestyle, rising number of people with cardiovascular diseases and growing prevalence of obesity. According to a study published by Dong Zhao in Journal of the American College of Cardiology, CVD was the biggest cause of mortality in Asia in 2019, accounting for 10.8 million deaths which equates to 35% of all deaths in the region. Asia-Pacific segment is projected to grow over the forecast period.

Reduced Fat Butter Market Drivers

Increase in health awareness and demand for low fat food products is propelling the market growth

Consumers are becoming more conscious about their health and are adopting well balanced diets. Excessive butter fats increase the low-density lipoprotein (LDL) cholesterol in the blood and thickens the artery walls owing to which the risk of heart disease and stroke increases. According to World Health Organisation, cardiovascular diseases (CVDs) are the leading cause of death globally, taking an estimated 17.9 million lives each year, thereby estimated to drive the market growth of reduced fat butter. Owing to consumer’s increased health awareness number of cafes and restaurants are promoting and adding foods that are prepared with reduced fat butter. According to the American Heart Association (AHA, saturated fats should be just 5 or 6% of one’s daily calories. In terms of flavour and texture profile, reduced fat butter is nearly identical to butter, which makes it more preferable to health-conscious people, thereby driving the market growth.

Growing application of reduced fat butter in food industry is driving the market growth

Butter is used in a wide range of food products. The market for reduced fat butter is projected to grow owing to an increase in bakery product consumption as a result of changing lifestyles, the adoption of western-style snacking habits, and increased disposable income. In bakery, butter is used to give biscuits and cookies a spongy and crusty texture, to moisten the gluten network in doughs, making shaping easier, to extend the shelf life of the products, and to give the products a superior flavour, mouthfeel, and texture. Owing to increasing demand and awareness about the benefits of reduced fat butter, bakers and food manufacturers are preferring it more than the regular butter, thereby fuelling the market growth.

Reduced Fat Butter Market Challenges

Availability of reduce fat butter’s substitutes pose threat to market growth

Alternative of reduced fat butter such as olive oil, applesauce, mashed bananas, avocado spread, coconut spread and others is estimated to hinder the market growth over the forecast period owing to the health benefits they provide. For instance, olive oil contains no cholesterol or trans fats and contains antioxidants with heart-protective and anticancer characteristics, coconut spreads reduce the intake of saturated fats, avocados are high in minerals and vitamins, provides a creamy texture and helps in lowering cholesterol level. Furthermore, non-dairy fat substitutes reduce allergies and sensitivities associated with regular butter, hindering the market growth.

Reduced Fat Butter Industry Outlook

Product launches, mergers and acquisitions, joint ventures, and geographical expansions are key strategies adopted by players in the Reduced Fat Butter Market. The top 10- Reduced Fat Butter Market companies are-

1. Agral S.A.
2. Arla Foods Ingredients
3. Aurivo Co-Operative Society Ltd.
4. Finlandia Cheese Inc.
5. Kerry Gold
6. Lam Soon Group
7. Land O'lakes
8. Rockview Farms
9. Saputo Dairy Australia Pty Ltd.
10. Upfield

Recent Developments

• In January 2022, Oxie Nutrition launched FDA approved white chocolate peanut butter which has a great ratio of healthy fats and protein with minimal carbs. It has 70% less sugar, is high on protein and low on calories.
• In March 2021, Arla Foods, a Danish multinational cooperative based in Viby, Denmark and producer of dairy products in Scandinavia announced the expansion its Lurpak Lighter portfolio with the introduction of a new light butter which is lower in fat and contains only three natural ingredients.
• In July 2020, Land O'lakes entered into partnership with Microsoft Corp., to pioneer new innovations in agriculture and enhance the supply chain, expand sustainability practices for farmers and the food system, and close the rural broadband gap.

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