Natural Cheese Growth Reflects Shifting Consumer Preferences

With 4.3% growth, cheese category exceeds $21 billion in sales.

HART Insight Summary

Cheese remains one of the strongest-performing dairy categories, with strong growth driven by simplicity, versatility, and evolving consumer preferences. Recent sales data from Circana and insights from Euromonitor show that natural cheese is gaining momentum across multiple formats, including shredded, chunk, sliced, snack, and soft cheeses. Clean labels, protein content, and familiar ingredients are resonating with consumers, while innovation in formats and flavors is expanding how and when cheese is consumed.

Shredded cheese remains the largest segment by sales, while chunks, slices, snack cheeses, and refrigerated grated varieties are seeing notable year-over-year growth. Snack-oriented formats, particularly string and stick cheeses, continue to benefit from on-the-go consumption and meal replacement behaviors. At the same time, soft and spreadable cheeses are gaining traction as high-protein, lower-calorie options that align with wellness and clean-label expectations.

Innovation within the cheese case is also accelerating. Seasoned shredded cheeses, localized flavor profiles, seasonal offerings, and new natural American cheese formats are helping brands differentiate without moving away from core cheese types. European-style cheeses and Hispanic and Italian varieties are contributing incremental growth, especially in melting, topping, and specialty applications.

While processed cheese sales are declining overall, natural cheese formats are driving category expansion. Cheese consumption continues to rise in the U.S., supported by broader increases in dairy intake and renewed interest in protein-forward, functional foods. Looking ahead, analysts project cheese to remain one of the strongest growth drivers within dairy through the end of the decade.

Key Takeaways

• Natural cheese is growing in both sales and units, led by shredded, chunk, slice, snack, and soft formats.
• Clean-label positioning, protein content, and simple ingredients continue to influence purchasing decisions.
• Innovation is focused on formats, flavors, and usage occasions rather than entirely new cheese types.
• Snack and soft cheeses are gaining share as consumers seek convenient, functional options.
• Cheese remains a primary driver of overall dairy consumption growth.

At A Glance

Estimated Reading Time: 6 minutes
Original Publish Date: November 2025
Source: Dairy Foods

When it comes to natural cheese, “it’s almost heaven” for the category, which Chicago-based market research firm Circana notes is growing in both sales and units. In Irish singer-songwriter Niall Horan’s 2023 song, “Heaven,” he believes he “could die in your kiss,” proclaiming “it doesn’t get better than this.”

Simplicity in a song and simplicity in the natural, clean and simple ingredients found in cheese continue to be lauded by consumers. Horan’s lyrics encourage people to not give into societal pressures and timelines but to “live life in the moment.”

Cheese also is having its moment, belonging in its own class of greatness.

For one, the numbers don’t lie. 100% Natural cheese generated dollar sales of $21.1 billion, a 4.3% year-over-year (YoY) growth for the 52 weeks ending Sept. 7, according to Circana data.

Within the segments of natural cheese, shredded cheese, the No. 1 seller, saw 1.3% YoY growth to $7.4 billion, while chunks and slices are “hitting high notes” with a 9.4% and 2.3% YoY growth and dollar sales of $6 billion and $3.7 billion, respectively. Albeit from a smaller revenue stream, refrigerated grated cheese reached the mountain peak with sales of $224 million and a sharp YoY climb of 12.9%, the category’s largest percentage of growth.

Other claims contributing to dollar growth were kosher, gluten free, no added/not treated with hormones, and no/ low/less sugar.

Circana’s Melissa Altobelli, senior vice president of Client Insights, states, “Chunks, Slices and Snack cheese are seeing growth in the Natural Cheese category in the latest 52 weeks, with Chunks Cheese seeing the most significant gains, up 9.4%.”

As snacking and cheese continues to resonate with consumers, string/stick cheese are enjoying fame with $1.8 billion in sales and 5.2% YoY growth.

“Snack Cheese is up about 6% in the latest 52 weeks, with Snack String/Stick being the largest segment,” Altobelli notes. “The fastest growing subsegment in the Snack Cheese category is the Snacking Cracker Cuts. Consumers are snacking throughout the day and are looking for snacking options that can be eaten on the go or instead of meals both at home and at work.”

While processed cheese has been around for a long time, the overall category is down 2.9%, with sales of nearly $3.5 billion for the 52 weeks ending Sept.7, Circana data reports.

Slice Cheese, -4.3%, Loaf Cheese, -3.7%, and Spread Cheese, -8.1%, are on the decline, contributing to the overall decline in the Processed Cheese Category, Altobelli says. The Cheese Spreads/Balls segment, with dollar sales of $696 million, was the only processed cheese segment that demonstrated growth, in this case, 3.5%, per Circana data.

Within the alternative cheese category, shredded cheese, at 1.8% growth, is the only subcategory exhibiting growth, while the other plant-based subcategories are losing ground, Circana’s Altobelli says.

Yet, within the cheese case, two innovation areas are capturing stomach share, she adds. They are:

Seasonings in shredded cheese bring new flavor experiences beyond what can be achieved with cheese blends (red hot, dill pickle).
American cheese is experimenting with new product formulations and formats, i.e., natural American cheese sliced line at the start of 2025 or 8-ounce bricks for easy melting, whether in dips or favorite cooking recipes.

Spreading The Growth

Within the dairy case, growth is driven by core cheese types like mozzarella, Colby jack and cheddar. European-style cheeses, like gouda and havarti, are showing strong growth but those are niche varieties, Altobelli says.

“Within Deli Specialty, leading the growth are Hispanic and Italian cheese types, though specialty set is highly fragmented by cheese varieties.” Altobelli explains. “Topping and melting cheeses lead the way for Hispanic cheese types, including queso fresco, chihuahua and cotija. Parmesan, mozzarella, burrata and Romano are key growth drivers among the Italian varieties.”

The cheese category is seeing strong momentum, particularly among soft and spreadable formats, according to Maria Mascaraque, senior insight manager at Chicago-based Euromonitor International.

“These products are increasingly positioned as high-protein, lower-calorie options that align with clean-label preferences, offering indulgence without compromising on health,” Mascaraque says. “Notably, soft cheese contributed the largest absolute growth in the dairy industry between 2020 and 2025, adding $15.6 billion in value globally.

“An interesting point for cheese is how brands are innovating with localized formats to tap into regional consumption habits, like Bel Brands’ adaptation of The Laughing Cow for Chinese breakfast occasions — this is a prime example of how cultural relevance can unlock new occasions,” she adds.

Companies also are capitalizing on the changing seasons to drive flavor interest and growth. Chicago-based Bel Brands USA, makers of The Laughing Cow and Mini BabyBel, unveiled Laughing Cow Pumpkin Spice.

The limited-edition cheese, which was available through November 2025, featured the warm flavors of cinnamon and pumpkin blended with The Laughing Cow’s signature creamy texture. Each individually wrapped wedge is made with real cheese, contains two grams of protein and is a good source of calcium, the company says.

Also adding a flavorful twist to its fresh goat cheese line, Malone, Wis-based LaClare Creamery unveiled two new seasonal chèvre varieties: Cranberry Orange and Cinnamon Spice, handcrafted to bring fall flair to everyday meals. Cranberry Orange balances the creaminess of the Original with sweet orange zest and tart cranberries, while Cinnamon Spice adds a blend of warm, autumnal spices.

Growing Dairy Consumption

The U.S. Food and Drug Administration (FDA) is updating what it means to be a “healthy” food in addition to proposing required front-of-package labels. This will have an impact on consumer buying decisions, Altobelli says.

The good news, however, is that cheese consumption continues to rise. Overall per capita consumption of dairy is increasing in the U.S., and cheese is mostly driving that growth. From 2013 to 2023, per-capita cheese consumption increased by 6.8 pounds.

Per-capita consumption of dairy in the United States reached a record 661 pounds per person in 2023, driven by increased demand for cheese and butter. Per capita cheese consumption has doubled in the last 50 years, and fluid milk consumption is growing for the first time since 2009, according to the International Dairy Foods Association.

Euromonitor’s Mascaraque suggests that the dairy industry’s growth in 2025 is largely led by pricing, with modest volume performance. “Retail value sales for dairy products and alternatives are projected to reach $705 billion globally this year, with volume growth at just 1.3%,” she says.

She also suggests that functional ingredients like dietary fiber, prebiotics, probiotics, and protein are enhancing the nutritional profile of cheese and other dairy products.

“Protein isolates, probiotics, prebiotics and botanicals are being incorporated across formats to support health benefits such as digestion, immunity and energy,” Mascaraque says. “Cheese is increasingly positioned as a functional snack, with innovations like high-protein cheese sticks and fortified spreads catering to wellness-conscious consumers.

“A notable example is Lactalis’ Lindahls, which launched high-protein cheese and milk drinks in the UK in July 2025, responding directly to consumer demand for convenient, protein-rich formats,” she concludes. “These products are part of a broader shift toward multifunctional dairy, where traditional formats are being reimagined to deliver targeted benefits. Cheese stands out as the category exceeding expectations in terms of absolute growth. It is projected to add nearly $30 billion in retail value by 2030, driven by its versatility and alignment with health trends.”

HART Perspective

Sustained growth across multiple cheese formats reinforces the operational complexity facing today’s cheese plants. While ingredient simplicity resonates with consumers, production environments are managing more SKUs, more formats, and more frequent changeovers. Shredded, sliced, chunk, snack, and soft cheeses each place different demands on forming, cutting, conveying, and packaging systems.
We’re also seeing how format-driven innovation increases the need for consistency and sanitation. Snack cheeses and high-protein formats rely on precise portioning and repeatable performance, while seasoned and specialty products require equipment that can handle inclusions, texture variation, and tighter quality tolerances. As cheese producers expand offerings without sacrificing efficiency, flexibility on the production line becomes increasingly critical.

What This Means for Cheese & Dairy Processors

• Format diversity is increasing: Plants must support shredded, sliced, chunk, snack, and soft cheeses on shared or adjacent lines.
• Changeover efficiency matters: More SKUs and seasonal products increase downtime risk without flexible equipment design.
• Consistency supports growth: High-volume snack and shredded products depend on repeatable cutting, forming, and packaging performance.
• Sanitation remains essential: Clean-label positioning heightens expectations around hygiene and process control.
• Scalable flexibility is a competitive advantage: Equipment that adapts to new formats helps processors keep pace with category growth.

Attribution

This article references industry reporting and data originally published by Dairy Foods. HART Design & Manufacturing has added independent analysis and dairy-processing context. The original publishers did not contribute to or review these additions.