Mergers and acquisitions reshaped the world’s largest dairy companies, as the industry entered what the RaboResearch’s 2026 ranking report called a “new phase defined by consolidation, specialization and a greater focus on value creation.”
The Global Dairy Top 20 ranking predominantly uses estimated dairy sales based on 2025 financial results and accounts for mergers and transactions completed as of July 1, 2026.
The top three remained in the same spot from a year ago, with Lactalis at No. 1 at $40.2 billion, followed by Nestlé at $23.7 billion and Dairy Farmers of America at $23.1 billion.
Beyond acquisitions, dairy companies are focusing on higher-value segments such as nutrition, protein ingredients, specialty cheeses and functional dairy products, according to RaboResearch.
“After decades in which growth was often driven by increasing milk volumes and geographic expansion, leading dairy companies are now prioritizing scale, profitability and strategic focus,” the report noted.
M&A changing the dairy landscape
Dairy’s biggest shift is taking place in market consolidation, according to RaboResearch, noting large deals such as Lactalis’ (France) acquisition of General Mills’ US yogurt business and Fonterra’s Mainland (New Zealand) consumer business.
The three biggest shifts in the annual rankings were driven by M&A, according to Tom Booijink, RaboResearch senior analyst of dairy in Europe and Africa.
Booijink noted that Arla Foods (Denmark) moved up two spots to No. 4, with estimated dairy sales of $23 billion in 2025, following its merger with Germany’s DMK Group, which ranked No. 18 last year.
Fonterra’s divestment in the deal with Lactalis moved the company to the No. 10 spot, down three places from 2024.
RaboResearch said Lactalis’ acquisition of Fonterra’s Mainland was the most significant development of the year, calling it “a transaction that significantly strengthens Lactalis’ footprint across Australia and Asia and adds an estimated $3.4 billion to revenue.”
Additionally, the purchase of General Mills’ US yogurt business added an estimated $1.4 billion in sales to Lactalis’ portfolio. “The acquisition further strengthens Lactalis’ position in chilled dairy, now one of the company’s most important growth categories,” the report noted.
Lactalis also pursued targeted acquisitions in 2025 through its integration of Queijos Tavares in Portugal and Granja Pocha in Uruguay, according to the report.
Meanwhile, Unilever spun off its ice cream business to The Magnum Ice Cream Company, leading to the departure of Unilever from the 11th spot, where Magnum replaced it.
Nestlé and Unilever separate ice cream operations
Nestlé and Unilever have moved to separate ice cream from their directly operated portfolios, although both retained ownership interests in standalone ice cream companies.
“The market and (frozen) supply chain having too little in common with the rest of their businesses,” Booijink said in an email.
He added that “specialization and focus are the themes of this year.”
Nestlé is among the world’s largest dairy companies, but its $11.7 billion milk products and ice cream segment represents a declining share of its broader food and beverage portfolio, according to the report.
In February 2026, Nestlé announced it was in negotiations to transfer its remaining ice cream businesses, generating roughly $1.1 billion in annual sales, to Froneri, its 50/50 joint venture with private equity firm PAI Partners.
Nestlé’s focus on high-growth categories means a relative decline for the company’s dairy business, despite the company’s scale, according to RaboResearch.
“While dairy remains a significant source of business, Nestlé increasingly operates as a diversified food and beverage company rather than a dairy-focused competitor, in contrast to acquisitive dairy specialists such as Lactalis,” the report noted.
Dairy Farmers of America to eclipse Nestlé?
The largest dairy co-op in the US, Dairy Farmers of America (DFA), could eclipse Nestlé for the No. 2 spot, according to Booijink.
The report noted that DFA continued to expand its processing footprint through targeted acquisitions in 2025, including the purchases of Winona Foods’ Lineville cheese facility and W&W Dairy, both in Wisconsin.
RaboResearch noted that DFA’s investments in ingredients, cheese and consumer dairy products makes it “one of the world’s most vertically integrated dairy organizations and a critical force in the North American industry.”
DFA is a credible strategic acquirer with a proven ability to execute large-scale dairy transactions, according to Booijink, adding that a small acquisition could put the organization into second place.
