Market Overview
The global fats and oils market was valued at USD 225.1 billion in 2020 and is projected to reach USD 290.3 billion by 2026, growing at a CAGR of 4.2% during the forecast period (2021-2026). The growth of the market is attributed to factors such as increasing demand for fats and oils in various food applications, such as bakery, confectionery, and convenience foods, rising demand for biofuels, and growing consumer awareness regarding the health benefits of certain types of fats and oils, such as olive oil and coconut oil. The market is also driven by the increasing adoption of plant-based oils and fats by consumers.
The global fats and oils market is a large and diverse industry, encompassing a wide range of products used in food, industrial, and personal care applications. Fats and oils are essential ingredients in many food products, providing flavor, texture, and nutritional benefits. In addition, they are widely used in the manufacture of industrial products such as biofuels, plastics, and lubricants. The fats and oils market is segmented by product type, source, application, and region. Product types include vegetable oils, animal fats, and specialty fats. Sources can be plant-based, such as soybean, palm, or sunflower oil, or animal-based, such as tallow or lard. Applications include food and beverage products, animal feed, personal care products, and industrial applications.
The market is driven by several factors, including increasing demand for convenience foods, growing awareness of the health benefits of certain oils, and the use of oils in the production of biofuels. In addition, the market is affected by government regulations, sustainability concerns, and changing consumer preferences. The major players in the global fats and oils market include companies such as Cargill, Archer Daniels Midland (ADM), Wilmar International, Bunge Limited, and IOI Corporation. These companies are engaged in the production and sale of a wide range of fats and oils products, and also work to develop new and innovative products, improve production processes, and address sustainability concerns.
The global fats and oils market is driven by various factors, including:
• Increasing demand in the food industry: Fats and oils are widely used in the food industry for various applications, such as frying, baking, and as ingredients in processed foods. The growing demand for convenience foods and processed foods is driving the growth of the fats and oils market.
• Health and wellness trends: Consumers are becoming more health-conscious and are looking for healthier alternatives to traditional fats and oils. This has led to an increase in demand for healthier oils such as olive oil, avocado oil, and coconut oil.
• Growing demand for biofuels: Fats and oils are used as feedstocks for the production of biofuels, which are renewable sources of energy. The increasing demand for biofuels as a cleaner and greener alternative to traditional fossil fuels is driving the growth of the fats and oils market.
• Growing population and urbanization: The global population is increasing, and so is the demand for food. Urbanization is also leading to changes in dietary habits and an increase in demand for convenience foods, which are driving the growth of the fats and oils market.
• Increasing adoption of plant-based oils and fats: With the growing trend towards plant-based diets, there is an increasing demand for plant-based oils and fats such as soybean oil, canola oil, and palm oil.
These are some of the key drivers of the fats and oils market, and companies in this industry are likely to benefit from these trends in the coming years.
Product Type Insights
The largest product type segment in the fats and oils market varies depending on the region and other factors, but globally, vegetable oils are generally the largest product type segment. Within the vegetable oils segment, palm oil is the largest sub-segment, accounting for a significant portion of the market share due to its widespread use in food and non-food industries. Other large sub-segments of the vegetable oils market include soybean oil, sunflower oil, and rapeseed oil.
Animal fats and specialty fats also have significant market shares, with tallow, lard, and butter being the largest sub-segments of the animal fats market, while cocoa butter equivalents and substitutes are the largest sub-segments of the specialty fats market. However, the growth of these segments may be affected by factors such as consumer preferences, regulations, and sustainability concerns.
Application Insights
The fats and oils market has several application segments, including food, industrial, and personal care. Among these, the food segment is the largest application segment for fats and oils, accounting for a significant share of the market.
Fats and oils are widely used in the food industry for various applications, such as frying, baking, and as ingredients in processed foods. The demand for convenience foods and processed foods is driving the growth of the fats and oils market. In addition, the increasing adoption of plant-based diets is leading to an increase in demand for vegetable oils, such as soybean oil and canola oil.
Within the food segment, the largest sub-segments for fats and oils are bakery, confectionery, and processed foods. In the bakery segment, fats and oils are used as ingredients in various products such as bread, cakes, and pastries. In the confectionery segment, fats and oils are used as coatings and fillings for products such as chocolates and candies. In the processed foods segment, fats and oils are used as ingredients in products such as snacks, ready-to-eat meals, and frozen foods.
Overall, the food segment is expected to continue to be the largest application segment for fats and oils in the coming years, driven by the growing demand for convenience foods and the increasing adoption of plant-based diets.
Regional Insights
The largest region in the global fats and oils market is Asia Pacific, which accounted for a significant portion of the market share in 2020. The region is home to some of the largest consumers of vegetable oils, such as India, China, and Indonesia, due to the widespread use of these oils in traditional cuisines. The growing population and urbanization in these countries have also contributed to the increasing demand for fats and oils in the region.
North America and Europe are also significant markets for fats and oils due to the high consumption of processed foods and growing demand for healthy and sustainable ingredients. The Middle East & Africa and Latin America regions also have significant market shares, with growing demand for fats and oils in the food and industrial sectors. However, the growth of these regions may be affected by factors such as political instability, economic downturns, and environmental concerns.
Key Companies Insights
The global fats and oils market is highly competitive, with numerous players operating in the market. The competitive landscape of the market is influenced by factors such as product innovation, pricing, brand recognition, and distribution channels. Product innovation: Companies are investing in R&D activities to develop new and innovative products that cater to the changing consumer preferences, such as healthier fats and oils. Furthermore, established players in the market enjoy a strong brand recognition due to their long-standing presence in the market and investments in marketing and advertising. Also, companies are expanding their geographic reach to cater to the growing demand for fats and oils in emerging markets. Some of the prominent players operating in the global fats oils market include:
• Archer Daniels Midland Company
• Cargill, Incorporated
• Bunge Limited
• Wilmar International Limited
• IOI Group
• Sime Darby Plantation Berhad
• Louis Dreyfus Company B.V.
• AAK AB
• Associated British Foods plc
• Ajinomoto Co., Inc.
These companies operate in various segments of the market, including vegetable oils, animal fats, specialty fats, and others. They are also involved in various stages of the supply chain, including production, processing, distribution, and marketing of fats and oils. The market is highly competitive, and companies are investing in R&D activities and new product launches to maintain their market share and expand their customer base.

Segments
By Product Type
• Vegetable oils
• Animal fats
• Specialty fats
By Source
• Plant-based
• Animal-based
By Functionality
• Cooking
• Frying
• Flavouring
• Nutritional
• Emulsifying
• Texturizing
• Others
By Application
• Food and beverage
o Bakery
o Confectionery
o Dairy
o Convenience food
o Others
• Industrial
o Biofuels
o Lubricants
o Personal care and cosmetics
o Others
• Animal feed
By Geography
• North America
o U.S.
o Canada
o Mexico
• Europe
o U.K.
o Germany
o France
o Italy
o Spain
o Russia
• Asia-Pacific
o Japan
o China
o India
o Australia
o South Korea
o ASEAN
• Latin America
o Brazil
o Argentina
o Colombia
• MEA
o South Africa
o Saudi Arabia
o UAE
o Egypt