The France-based company's narrow dominance reflects the diversified nature of the global dairy industry.
According to Euromonitor, the top ten dairy manufacturers account for just 23.1 per cent of total sales, leaving room for manoeuvre for competitors around the world.
Leading players' nutrition mission With commodity prices for raw milk increasing on the back of a tightening supply, both market leader Danone, and rival multinational Nestle - which accounts for 4.1 per cent of total dairy sales - have moved towards nutrition.
Danone announced a proposed acquisition of nutrition group Numico in July this year for €55 per ordinary share in cash, amounting to a total of €12.3bn.
The move is expected to propel it into a top three spot in major markets for nutrition and infant products.
The France-based company will hold 100 per cent of the specialised nutrition company upon completion of the deal.
Despite the nutrition focus, Danone has said it will concentrate its operations on dairy production, which is expected to account for 51 per cent of company sales.
Additionally, beverages will account for 27 per cent of the group's earnings, and nutrition, the new "third pillar", 22 per cent, Danone claims.
Danone is not alone with these nutrition aims though, as Nestle has also made significant investments into nutrition.
The company announced in April this year that it was moving for infant formula group Gerber, which is worth $5.5bn (€4bn), highlighting Nestle's continuing expansion into a nutrition, health and wellness.
The company has also acquired Jenny Craig, the Australian cereal business Uncle Toby's, and Novartis Medical Nutrition within the past year.
Kraft Foods Kraft, which this year announced it had entered into a deal to purchase Danone's biscuit division, was in third place in terms of dairy sales for the year, with a 3.2 per cent market share.
The sales reflected the groups' presence in production of natural, processed and cream cheeses.
Dean Foods US-based Dean Foods was in joint fourth position with a 2.2 per cent market share.
The company also has operations in the UK, where it is a producer of organic yoghurts.
Vive la France Besides Danone, two over major French dairy producers were included in the top ten dairy producers list, despite growing difficulties for some producers in the market related to commodity prices and competitiveness.
Groupe Lactalis, which like Dean Foods accounts for 2.2 per cent of total global sales, continues to look to emerging growth markets like Croatia to boost sales of its products.
Meanwhile, national counterpart Sodiaal SA posted a 1.8 per cent share of the global dairy market in 2006, Euromonitor said.
The company has restructured itself in the wake of reforms to the European dairy sector, by merging its cheese production facilities with those of national rival Bongrain in a move the company claims will boost productivity.
Parmalat
The restructured Italian firm has bounced back from the financial scandal, which drove it to bankruptcy in 2003, last year claiming a 1.7 per cent share of dairy products market.
Under a new management structure, the company is now moving to expand into new markets like Russia, in a bid to tap potential in the country's dairy sector.
Arla Foods
The Scandinavian cooperative held a 1.6 per cent market share of the dairy market during 2006, though like a number of its European rivals has moved to restructure its operations for greater profitability from the supply chain.
As a result of this focus, the company this year announced plans for a temporary cut in cheese production, whilst encouraging its member - which also act as suppliers - to turn to higher-value organic production.
Yakult Honsha Japan-based Yakult Honsha rounded up the top ten by accounting for 1.2 per cent of global sales of dairy products.
The firm, which holds a strong presence in probiotic products increasingly linked to health and nutrition benefits, announced in May that it was strengthening its R&D relationship with Danone.
Danone is the largest shareholder within the company, holding a 20 per cent stake in Yakult's operations.