Cheese Sauce Market Expected to Reach $9.1 Billion by 2035

According to a new report published by Allied Market Research, titled, “Cheese Sauce Market," The cheese sauce market was valued at $5.5 billion in 2023, and is estimated to reach $9.1 billion by 2035, growing at a CAGR of 4.4% from 2024 to 2035.

An increasing number of individuals, particularly children, are drawn to fast food items like pizza, burgers, and pasta. Among consumers aged 2 to 19 years, about 36% consume fast food daily, mirroring adult trends. Despite the focus on healthy eating by younger generations, many children and young adults still get a significant portion of their daily calories from fast food. The global rise of quick-service restaurants further illustrates this trend. McDonald’s, for instance, operates in over 119 markets with more than 39,000 locations, reflecting the growing demand for convenient dining. On average, a fast-food meal accounts for 37% of daily calorie intake, along with 42.6% of daily carbs, 33.6% of fat, and 15.4% of protein. These figures highlight the prominent role fast food plays in shaping dietary habits. To meet this demand, many fast-food outlets have introduced cheese sauces into their menus, enhancing flavor and appealing to consumers, especially the younger generation, whose preferences are increasingly shaping the market and indicated cheese sauce market trends.

However, health concerns related to excessive consumption of cheese sauce include weight gain, heart problems, and digestive issues. Overindulging in cheese and fatty dairy products can lead to complications such as obesity, high cholesterol, and gastrointestinal disorders. As awareness of these health risks increases, it may lead to a decrease in consumer interest in cheese sauces. In addition, rise in health concerns can prompt regulations or public health campaigns that further discourage their consumption. Issues such as weight management and heart health are significant factors behind the decision to limit cheese sauce intake, which in turn affects its overall demand and popularity.

Furthermore, expanding distribution networks and retail channels present significant cheese sauce market opportunities for the cheese sauce industry by enhancing accessibility and availability. With traditional and online grocery channels expanding worldwide, more consumers can access a broader range of food products. For instance, the FMI Survey, which represented more than 11,000 stores by 36 companies, found that 84% of participating food retailers have implemented strategies focused on nutrition, health, and well-being. In addition, the rapid rise of ecommerce in food retail is transforming consumer grocery shopping habits. The increase in convenience stores, which experienced a 7-9% sales growth in 2022 according to the National Association of Convenience Stores (NACS), also provides new retail avenues for cheese sauces aimed at on-the-go consumers. These expanded channels enable cheese sauce producers to tap into new markets, particularly as the demand for convenient, ready-to-use food products grows in both physical and online stores.

The cheese sauce market segmentation includes analysis by cheese type, source, end user, distribution channel, and region. By cheese type, the market is divided into cheddar, mozzarella, parmesan, American cheese, blue cheese, provolone, gouda, Montero jack, and others. By source, the market is divided into organic and conventional. By end user, the market is divided into households and foodservice. By distribution channel, the market is segmented into convenience stores, hypermarkets/supermarkets, specialty stores, direct, online channels, and others. Region-wise, the market is analyzed across North America (the U.S., Canada, and Mexico), Europe (the UK, Germany, France, Russia, Italy, Spain, and the rest of Europe), Asia-Pacific (China, Japan, India, South Korea, Australia, Indonesia, and the rest of Asia-Pacific), and LAMEA (Brazil, South Africa, Saudi Arabia, UAE, Argentina and rest of LAMEA).

By type, the market is segmented into cheddar, mozzarella, parmesan, American cheese, blue cheese, provolone, gouda, Montero jack, and others. The cheddar segment accounted for a major position in the cheese sauce market share in 2023 and is expected to grow at a significant CAGR during the cheese sauce market forecast period. Cheddar is off-white, sharp tasting, and hard cheese, which originated in the village named Cheddar in Somerset, southwest England as the temperature and humidity in this region were ideal for maturing of cheese. Presently, cheddar cheese sauce is being consumed worldwide, and has become an indispensable and important part of fast food.

By source, the market is segmented into organic and conventional. The conventional segment dominated the global cheese sauce industry. Conventional cheese is often more convenient due to its longer shelf life and widespread availability that makes it easily accessible for consumers. In addition, it requires no special preparation or storage, allowing for quick incorporation into meals and snacks, which aligns well with busy lifestyles.

By end user, the market is segmented into households and food services. The foodservice segment holds a major market share owing to increase in demand from restaurants, cafes, and catering services that incorporate cheese sauces into a variety of dishes. The rise of quick-service restaurants and the growing trend of comfort food contribute to the popularity of cheese sauces in menu offerings.

By distribution channel, the market is segmented into convenience stores, hypermarkets/supermarkets, specialty stores, direct, online channels, and others. The direct segment is expected to account for a major share in the global market during the forecast period. People who want to purchase from the comfort of their homes take advantage of online shopping rather than having to travel to actual stores. Customers who reside in rural or remote places or who have restricted mobility pay particular attention to this. Online sales channels also enable a higher level of personalization of the buying experience, due to features such as personalized product recommendations and the simplicity of searching and filtering for specific products.

Region wise, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA. The Europe cheese sauce industry accounted for a major share in 2023 and is expected to grow at a significant CAGR during the forecast period. The main drivers of the cheese sauce market growth in Europe are the developing trend of fast-food chains, the rise in demand for ready-to-eat food, and the growth in desire for convenience food products

The major players operating in the market focus on key market strategies, such as mergers, product launches, acquisitions, collaborations, and partnerships. They have been also focusing on strengthening their market reach to maintain their reputation in the ever-competitive market. Some of the key players in the cheese sauce market size include Campbell Soup Company, Conagra Brands, Inc., Kerry Group Plc., Unilever Plc., Gehl Foods, LLC., AFP Advanced Food Products, LLC., Tatua, Nestle S.A., The Kraft Heinz Company, and TreeHouse Foods, Inc.

Key findings

• Based on type, the cheddar segment dominated the market in 2023, and is expected to retain its dominance throughout the forecast period.
• By source, the conventional segment was the major shareholder in 2023.
• Depending on end-user, the foodservice accounted for highest share in the market in 2023.
• By distribution channel, direct holds major position in 2023.
• In cheese sauce market analysis, Europe dominate the market in 2023.