Protein fever fuels dairy M&As
Reading time
4 min read
Date
Aug 18, 2026
Author
Carolina Reis - Associate Partner, Consumo, Varejo & Educação, igc Partners
A wave of mergers and acquisitions has swept through the dairy sector over the past year.
Well-known consumer brands—such as Piracanjuba, Tirolez, and Italac—have been on a shopping spree, a move that combines the pursuit of a larger presence in high-demand, higher-value-added segments with regional diversification. But why now?
Part of the explanation can be attributed to the recent protein craze. The unbridled consumer demand for protein-rich foods has put whey—a byproduct of cheese manufacturing—in the spotlight for both local and international investors.
"Whey is increasingly becoming an important revenue stream for the dairy industry that produces cheese," says Valter Galan, a partner at MilkPoint, one of the leading consultancies for the dairy sector in Brazil.
Data compiled by MilkPoint illustrates the growing relevance of this byproduct. In July, the price of whey powder was R$ 9.54 per kilogram, an increase of nearly 35% compared to the same month the previous year.
The demand for this byproduct has been driving M&A activity even outside of Brazil. In January, the Dutch multinational cooperative Royal FrieslandCampina acquired the American company Wisconsin Whey Protein—which focuses precisely on this market.
"Today, 71% of consumers are actively prioritizing protein intake, a notable increase from 59% in 2022 and 67% in 2023," FrieslandCampina stated. According to the company, the whey protein market is expected to grow at a rate of 6.6% per year through 2030.
The fact that whey has become a kind of golden goose helps draw attention to the cheese sector in Brazil, providing recent support to other structural factors that make this market attractive in the country.
According to data from Abiq (Brazilian Cheese Industry Association), per capita consumption is at seven kilograms per year—still well below nations like Argentina, which consumes about 12 kilograms annually, and also lower than European countries like Greece and France.
Beyond the growth potential in volume, the cheese market also offers room for diversification. More than a third of Brazilian consumption consists of commodity cheeses, such as mozzarella, which delivers an EBITDA margin in the 4% to 6% range, according to MilkPoint.
Fine cheeses tend to have higher margins—and they are attracting interest. The acquisition of the Minas Gerais-based Básel Lácteos by Piracanjuba in January of this year is an example of this trend, which is crossing national borders, according to Carolina Reis, an associate partner at the M&A boutique igc.
“Especially for foreign investors who aren't here yet, specialty cheeses—burrata, Gruyère, provolone, and so on—have been catching their attention,” she says.
One factor that may stimulate this demand is the income elasticity of consumption (the more wages improve, the more cheese consumption tends to increase).
Another point is the search for healthiness combined with protein intake—since cheese provides protein and calcium right off the bat. “There is even a matter of new occasions for people to consume cheese as snacks,” adds Reis.
While consumers remain eager for protein-rich foods, on the production side, the fragmentation of the dairy sector in Brazil provides additional support for mergers and acquisitions.
“There are many regional players. The top five don't even account for 50% of milk collection. It is this long tail that fuels mergers and acquisitions,” summarizes Reis.
Through M&As, companies can access other milk basins—that is, hubs in different producing regions. “When a large company buys a regional one, it usually keeps the procurement team; very little changes in that relationship,” says Galan.
The Southeast and South regions hold the country's largest dairy basins, but the Northeast has been gaining prominence with accelerated growth in dairy production over the last few years—a trend that has caught the attention of outside companies.
Between 2014 and 2024 (the most recent edition of the IBGE's monthly livestock survey, the PPM), the Northeast was the only region in Brazil to see actual growth in milk production.
The region saw a 65% increase during this period, reaching 6.4 billion liters. The country as a whole remained virtually stable during this time (1.7% growth), with a total production of 35 billion liters.
According to Galan, from MilkPoint, this progress stems from overcoming more challenging production conditions, driven by increased grain production in the Matopiba region and the integration of irrigation systems with compost barns (a type of housing for dairy cattle).
Investment in the region is also driven by demand. "The Northeast is, perhaps after the Southeast, the main consumer market for dairy products in Brazil. And it has a significant production deficit," says Galan.
To put the deficit into perspective, in 2025 alone, milk production in the Northeast grew by 14% compared to the previous year, with increases in virtually every state in the region. Even so, the trade deficit grew by more than 10% in the same period, as shown in a study conducted by researcher Kamilla Ribas Soares for the Bank of the Northeast.
"We have been hearing from buyers interested in entering the region to diversify their cooperative base and gain better bargaining power with clients. If you add new products, you ultimately achieve a stronger presence on the shelf," says Reis.
