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.

Available through November, the seasonal variety features 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.

Dairy consumption growing

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, 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.” DF