Chicago, March 01, 2023 (GLOBE NEWSWIRE) -- The global fats and oils market is projected to grow at a CAGR of 3.8% to reach USD 285.2 billion from USD 236.7 billion in 2021. Oils and fats are naturally occurring food ingredients that are derived from plants and animals. There are nearly 30 different types of vegetable oils and animal fats that are being traded commercially. Palm oil, soybean oil, rapeseed oil, and sunflower oil are the four main types of oils accounting for nearly 80% of global edible oil production. Global economic growth has led to an increase in changing dietary patterns, which in turn has led to an increase in the demand for processed food and confectionery products. In emerging economies such as India and China, the growing urban population with changing food habits is driving the demand for processed food, fueling the demand for specialty fats & oils.
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Scope of the Report:
| Report Metrics | Details |
| Market Size Forecast 2026 | USD 285.22 Billion |
| Estimated CAGR | 3.8 % |
| Forecast Year | 2021-2026 |
| Forecast units | Billion (USD) |
| Segments covered | Type, Application, Form, Source, Region |
| Geographies covered | North America, Europe, Asia Pacific, South America, and RoW |
| Dominant Geography | Asia Pacific |
| Companies covered | Associated British Foods PLC (UK), Archer Daniels Midland Company (ADM) (US), Bunge Limited (US), Wilmar International Limited (Singapore), United Plantations Berhad (Malaysia), Unilever PLC (UK), Ajinomoto Co. Inc. (Japan), Mewah International Inc. (Singapore) |
Food manufacturers are formulating their products because of technical characteristics such as taste, shelf life, and nutritional characteristics of fats & oils imparted to many food products. Fats & oils contribute to the tenderness of cakes, aerate batter to render the required texture in cakes, add flavor to food products, act as lubricants for food products and their processing equipment, and add moisture to food products.
The consumption of olive oil is projected to observe the fastest growth in the fats and oils market soon. It consists of a mixture of triacylglycerol, with some fatty acids, majorly palmitic, palmitoleic, oleic, and linoleic acids. The health benefits associated with the regular use of Olive oil in the human diet ranges from increasing metabolism, preventing heart diseases, curing depression, and cancer prevention. It is also known to help lower the Low-Density Lipid (LDL) cholesterol and reduce the risk of Type 2 diabetes, cardiovascular diseases, and certain types of cancers, including breast cancer.
Vegetable oils with qualities such as low-fat, low-cholesterol, and low-calorie content are registering growth in the fats & oils market. Emerging markets offer wider opportunities for vegetable cooking oils in the form of high market penetration and an increase in per capita consumption. Markets in developed regions are witnessing innovations in terms of different flavors and fortifications of oils and an increase in the number of end-use applications. Thus, vegetables are emerging as the key source for fats and oils production.
According to Food and Agriculture Organization (FAO), India, the second-largest consumer country in the world, closely behind China, and the world's top importer of vegetable oil, is expected to maintain a high per capita consumption growth of 3.1% per annum and reach 24 kg (52.9 pounds) per capita in 2027. Thus, high rate of consumptions in the region is estimated to account for the larger market share of Asia Pacific region in the global market.
The Key players in this market include Associated British Foods PLC (UK), Archer Daniels Midland Company (US), Bunge Limited (US), Wilmar International Limited (Singapore), United Plantations Berhad (Malaysia), Unilever PLC (UK), Ajinomoto Co., Inc. (Japan), Mewah International Inc. (Singapore), Cargill, Incorporated (US), Richardson International Limited (Canada), International Foodstuff Company (UAE), Goodhope Asia Holdings Ltd. (Singapore), Vega Foods (Singapore), Welch, Holme & Clark Co., Inc. (US), Oleo Fats (Philippines), CSM Ingredients (US), AAK International (UK), Fuji Oil Co., Ltd. (Japan), Gemini Edible & Fats India Pvt Ltd. (India), and K S Oils (Singapore).
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Growth Drivers of Fats and Oils Market from Macro to Micro:
Macro Factors:
- Increasing Population: The growing global population is one of the major drivers of the fats and oils market. As the population grows, the demand for food products also increases, which in turn drives the demand for fats and oils.
- Economic Growth: The economic growth of a country plays a significant role in the growth of the fats and oils market. Economic growth leads to an increase in income levels, which drives the demand for processed and convenience food products that use fats and oils.
- Urbanization: The increasing urbanization of the world population has led to a shift in dietary patterns. Consumers are increasingly opting for convenience food products that use fats and oils, such as ready-to-eat meals, snacks, and baked goods.
- Health and Wellness: Consumers are becoming more health-conscious, leading to an increased demand for healthier fats and oils, such as olive oil, avocado oil, and coconut oil.
Micro Factors:
- Product Innovation: Companies are continually innovating and introducing new products to the market, such as low-fat oils and trans-fat-free oils, to meet the changing consumer preferences.
- Branding and Marketing: Effective branding and marketing strategies help companies differentiate their products and increase their market share.
- Supply Chain Efficiency: Companies are continuously striving to optimize their supply chain to reduce costs and increase efficiency.
- Industry Consolidation: The fats and oils market are highly consolidated, with a few major players dominating the market. Mergers and acquisitions are common in the industry, leading to increased market concentration.
- Regulatory Environment: Regulations related to labeling, safety, and health claims can significantly impact the fats and oils market. Companies must comply with these regulations to ensure their products can be marketed and sold.
Hypothetic Challenges of Fats and Oils Market in Near Future
- Health Concerns: Consumers are becoming increasingly health-conscious, leading to a shift towards healthier oils and fats. This trend may impact the demand for traditional oils and fats, such as palm oil, which has been associated with health concerns.
- Sustainability: There is growing concern about the environmental impact of the fats and oils industry, particularly with respect to deforestation, greenhouse gas emissions, and water usage. Companies may need to adopt more sustainable practices to meet the changing consumer demand and regulatory requirements.
- Volatility in Raw Material Prices: The prices of raw materials, such as soybean, palm, and coconut, can be volatile and subject to supply chain disruptions. This volatility can impact the profitability of companies in the fats and oils market.
- Changing Regulatory Environment: Regulations related to labeling, safety, and health claims can significantly impact the fats and oils market. Companies must comply with these regulations to ensure their products can be marketed and sold.
- Competition from Alternative Sources: Alternative sources of fats and oils, such as algae and insects, are gaining traction in the market. These sources may provide a more sustainable and cost-effective alternative to traditional fats and oils, leading to increased competition for companies in the industry.
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Few Use Cases of Fats and Oils Market:
- Food and Beverage Industry: Fats and oils are essential ingredients in many food products, such as snacks, baked goods, and processed foods. They provide texture, flavor, and help to improve the shelf life of the products.
- Personal Care Industry: Fats and oils are commonly used in the personal care industry to make cosmetics, soaps, and shampoos. They help to moisturize and nourish the skin and hair.
- Biofuel Industry: Vegetable oils are used as a feedstock to produce biodiesel, which is an alternative to petroleum-based diesel fuel. The use of biodiesel can help to reduce greenhouse gas emissions and improve air quality.
- Animal Feed Industry: Animal fats and oils are used in the animal feed industry to provide essential nutrients to livestock and improve their health and productivity.
- Industrial Applications: Fats and oils are also used in a wide range of industrial applications, such as lubricants, surfactants, and solvents. They provide unique properties, such as viscosity and lubricity, that make them useful in these applications.
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