Global Fats & Oils Market Size, Trend & Opportunity Analysis Report, by Type (Fats—Butter, Tallow; Oils—Soybean Oil, Rapeseed Oil, Palm Oil, Coconut Oil, Olive Oil, Cottonseed Oil, Sunflower Seed Oil, and Others), Application (Food—Confectionery, Bakery,

Market Definition and Introduction

The global fats & oils market was valued at USD 116.70 billion in 2024 and is anticipated to reach USD 268.70 billion by 2035, expanding at a CAGR of 4.42% during the forecast period (2024–2035). Fats and oils exist in a complex interplay of distinct uses in nutrition, functionality, and commercial viability. An oil is needed to give flavour or stabilise texture in a food system ranging from bakery, confectionery, and dairy to packaged food, with palm oil, soybean oil, and rapeseed oil being among the most favoured options. The culinary richness of the world is enhanced by the cultural and regional importance that animal fats-tallow, ghee, and butter-provide. Consumers are now driving the market and asking for healthier, plant-based oils with a supposed low saturated fat content, like olive oil and sunflower seed oil, with the aim that none of these interventions might interfere with their normal cooking, frying, and formulation performance.

Growing demand for industrial uses of animal feeds is now being fueled by the dual pressure of population growth and feed security. Oils are thus being reformulated and blended for better shelf-life, oxidation, and bioavailability. Sustainability issues, of which palm oil is probably the main environmental focus, are thus giving rise to more sustainable-certified sourcing, oil extraction innovations, investment in waste minimisation, and circular economy approaches.

In the supply chain, different large players are extending their production networks and investing in the growth of plant-based oils and value-added derivatives in order to be able to compete sufficiently within the marketplace. Rapid urbanisation, dietary trends, and innovations in fortified and functional food products are continuously reshaping the consumption skew. With fats and oils straddling between the traditional and modern value chains, this is an industry in strategic renewal, forcing its players to consider the balance between tradition, innovation, and sustainability.

Recent Developments in the Industry

Strategic collaboration for the advancement of sustainable oil production

Cargill had earlier this year, that is April 2024, entered into multi-stakeholder partnerships with producers of palm oil and sustainability certifiers at the development of traceability systems whereby the plans seek to minimise deforestation footprints. This is designed to enhance compliance while strengthening the market's sustainability credentials.

Product launch in fortified oil innovation

OmegaLife™ fortified soybean oil is owned by Wilmar International and was extended into the markets of Asia in February 2025, catering to a range of health-conscious customers seeking cardiovascular benefits. Functional nutrition is taking on growing importance in daily edible oil choices by innovating in these areas.

Regulatory framework shifts in the EU oil market

The European Union has established more rigid labelling and sustainability reporting with regard to fats and oils in the Green Deal initiative for the year 2023. Such provisions include a requirement for producers to state the source, such as what country or countries they hail from, and/or carbon impact - a movement importantly connected to the expanding portfolios of eco-certified products.

Capital Investment in Refining Capacities

In June 2024, Archer Daniels Midland Company made an investment pledge amounting to 500 million US dollars regarding the development of its North America oilseed processing facilities. This is in response to the demand for high-protein meals and refined edible oils. The expansion underscores the criticality of upstream capacity in balancing supply chains.

Expansion in applications toward animal feed oils.

In September 2023, Bunge Limited increased operations in Brazil by introducing oil blends specifically designed for animal feeding. It is learned that agricultural players rely on oils to transform their product lines and create a new answer to changing nutritional demand in livestock production.

Innovation in Alternative Oil Sources

AAK AB announced, in December 2024, its pilot program for algae-based oil alternatives that will buttress conventional oil plant-based. This innovation is expected to give a high-yield and sustainable alternative to traditional oils while appealing to vegans and environmentally sensitive consumers.

Innovation in alternative oil sources

In December 2024, AAK AB revealed its pilot programme focusing on algae-based oil alternatives to complement traditional plant-based oils. The innovation is projected to offer a high-yield, sustainable substitute for conventional oils while appealing to vegan and eco-aware demographics.

Market Dynamics

Plant-based oil adoption across food applications is set to flourish amidst a rising health-aware consumer base.

Consumers all over the globe are increasingly demanding oils that are not just good for cooking but also deliver some health benefits. Plant oils such as olive, sunflower, and canola are becoming popular because of their fatty acid profiles for heart health and antioxidant content linked to cholesterol minimisation. Such requirements had changed demand patterns and caused manufacturers to recreate and reformulate processed foods, baked foods, and dairy alternatives blended with healthier oils. This trend is also allowing the integration of these oils with vitamins, omega-3s, and bioactive compounds, as suggested by the government and health-based organisations.

Sustainability concerns create constraints around palm oil dependency.

Palm oil is the most widely produced edible oil, yet it has a bad reputation for being linked with deforestation, loss of biodiversity, and human rights violations. Rising regulatory regimes and a backlash from consumers have increasingly constrained the oil's unfettered expansion. Certification schemes such as RSPO provide some risk mitigation; however, supply bottlenecks, certification costs, and public perception still create significant hurdles. Palm oil will continue to be relevant because of its versatility and cost; however, the transition to more traceable, certified, and alternative oils will define the sector's sustainability journey.

Market stability threatened by crop yield volatility and climate change challenges

The fats and oils market is heavily dependent on agricultural production, which is under constant threat from climate irregularities. Droughts, floods, and pest infestations have affected very key oilseed crops, including soya and sunflowers, providing disruptions to supply chains and price inflation. Extreme climate events also render regional yield fluctuations, making global sourcing and raw material diversification a must. Stakeholders are being forced to deal with these specific challenges by investing in resilient varieties of crops, in good logistics, and risk-hedging mechanisms to secure long-term growth.

Emerging opportunities in functional and fortified oil categories

Almost unexploited riches are available under these categories, with the growing consumer trend of fortified oils endowed with nutritional advantages. Firms are innovating with oils rich in omega-3, not only mixed with vitamin-enriched blends but also cholesterol-reducing formulations, in line with preventive health trends. Also gaining considerable attention are oils for use in sports nutrition, infant formulas, and medical food markets. This trend towards “nutritional customisation” is progressively shifting oils from traditional commodity-anxiety perspectives and transforming them into value-added products which drive the industry closer to health and wellness.

Technological advancement and trends are propelling change in oil extraction and processing innovation.

With the rising efficacy, yields, and product quality, oilseed crushing, solvent extraction, and cold-pressing technologies are changing fast in the sector. Automation, digitisation, and AI-enabled traceability systems are being embraced with increasing appeal for optimisation throughout refining and distribution. The rise of exploring non-traditional sources, algae or microbial oils, is the industry's signal for long-term alternatives to crop dependency. Combined, these innovations signify an ongoing shift towards technologically advanced, sustainable, and diversified production models appealing to industries and end customers.

Attractive Opportunities in the Market

Plant-Based Growth Surge – Rising consumer shift toward healthier, plant-based oils increases penetration in bakery and packaged foods.
Sustainable Palm Expansion – Certified and traceable palm oil programmes unlock opportunities for eco-conscious product portfolios.
Functional Nutrition Oils – Fortified oils enriched with omega-3, vitamin D, and antioxidants cater to wellness-driven consumers.
Animal Feed Applications – Growth of livestock industries spurs oil demand in feed for energy and nutrient supplementation.
Alternative Oil Innovation – Algae and microbial oil innovations offer scalable substitutes for conventional oilseed-based systems.
Regulatory Compliance Edge – Companies adhering to EU labelling and carbon disclosure standards capture regulatory-led market advantages.
M&A Consolidation Trends – Strategic mergers and acquisitions strengthen global processing and refining capacities.
Technology-Driven Efficiency – Advanced oil extraction and refining systems boost yield quality and operational competitiveness.
Fortified Food Markets – Demand for fortified dairy, bakery, and confectionery products enhances high-value oil utilisation.
Asia-Pacific Consumption Boom – Rapid industrialisation and urban dietary shifts fuel oil demand across multiple applications.

Report Segmentation

By Type: Fats (Butter, Tallow), Oils (Soybean Oil, Rapeseed Oil, Palm Oil, Coconut Oil, Olive Oil, Cottonseed Oil, Sunflower Seed Oil, Others)

By Application: Food (Confectionery, Bakery, Dairy Products, Others), Industrial, Animal Feed

By Source: Plant-Based, Animal-Based

By Region: North America (U.S., Canada, Mexico), Europe (UK, Germany, France, Spain, Italy, Spain, Rest of Europe), Asia-Pacific (China, India, Japan, Australia, South Korea, Rest of Asia-Pacific), LAMEA (Brazil, Argentina, UAE, Saudi Arabia (KSA), Africa Rest of Latin America)

Key Market Players

Archer Daniels Midland Company, Bunge Limited, Cargill Incorporated, Wilmar International Limited, Unilever PLC, IOI Corporation Berhad, Fuji Oil Holdings Inc., Associated British Foods plc, AAK AB, and Richardson International Limited.

Report Aspects

Base Year: 2024
Historic Years: 2022, 2023, 2024
Forecast Period: 2024-2035
Report Pages: 293

Dominating Segments

Oils Segment Leads the Global Market, Driven by Widespread Applications Across Food and Industrial Uses.

Oils have an outright supremacy in the global fats and oils sector due to their ubiquitous mode of operation in food processing and their prominence in the formulation of industrial applications. Palm, soybean, and rapeseed oils are together the most consumed oils for their versatility, cost efficiency, and good functional properties. The importance of soybean oil in bakery products, processed foods, and dairy substitutes goes without saying, while palm oil still boasts the foremost position worldwide in confectionery and packaged foods despite the opposite opinion towards sustainability. Rapeseed oil, on the other hand, is steadily forging a niche in the health segment due to its low saturated fat content, while the increasing demand for fortified and cold-pressed oils has accelerated the growth of this segment and has strengthened its footing in mass-market and premium segments.

Food Applications Segment Holds Firm at the Top, Billed by Ever-Increasing Consumption of Confectionery, Bakery, and Dairy Products.

Food applications stand out as the largest end-use category for fats and oils and are an irreplaceable ingredient for flavour, texture, and stability enhancement in the foods currently produced. There has always been a high demand for oils in bakery and confectionery products, whereby aeration, softness, and shelf-life extension are the contributions of oils. In dairy products like margarine, spreads, and cheese analogues, the trend is toward reformulation with healthier options and plant-based alternatives. Urbanisation and processed foods consumption have also been boosting the market of oils in ready-to-eat meals and packaged products. In the end, food-grade fats and oils continue to generate most of the market revenues, being irreplaceable for either traditional cuisines or innovations in modern food.

Plant-Based Segment Outpaces Growth, Driven by Health Consciousness and Sustainability Trends Worldwide.

Plant-based oils led by soybean, sunflower, and olive oils are fast gaining ground as consumers shift toward healthier, vegan, and eco-friendly options. The higher content of unsaturated fatty acids and the general perception that they are more sustainable compared to animal-based fats are putting plant-based fats in mainstream use in food and industrial applications. With the longstanding discussions regarding the sustainability of palm oil, the market is increasingly putting these concerns onto certified and traceable alternatives, namely sunflower and rapeseed oils. The other factor is the growing popularity of functional and fortified plant-based oils, which expand their territory into mass and premium markets. Animal fats retain cultural standing, but are increasingly confronted with health and environmental criticisms.

Key Takeaways

Oils Dominate Globally – Soybean, palm, and rapeseed oils drive demand due to versatility, affordability, and broad applications.
Food Industry Stronghold – Bakery, confectionery, and dairy segments remain the largest consumers of fats and oils globally.
Plant-Based Growth Surge – Rising preference for plant-based diets accelerates demand for healthier and sustainable oils.
Palm Oil Scrutiny – Sustainability challenges restrict unchecked expansion, but certification programmes offer growth opportunities.
Fortified Oils Rise – Innovation in nutrient-enriched oils unlocks premium product portfolios aligned with wellness trends.
Climate Challenges Persist – Agricultural dependency exposes the sector to climate variability and crop yield risks.
Asia-Pacific Momentum – Rapidly industrialising economies dominate consumption growth across both food and industrial uses.
Technological Innovations – Cold-pressed, algae-based, and fortified oil innovations reshape industry dynamics.
Industrial and Feed Growth – Expanding livestock and industrial applications strengthen non-food oil consumption.
Regulatory Edge Matters – Compliance with eco-labelling and carbon disclosure drives competitive advantage in developed markets.

Regional Insights

North America is defined by New Avenues in food, Industrial applications, and standardisation regarding Regulatory Affairs.

The fats and oils industry in North America has been nurtured by a very strong food manufacturing industry, growing consumer consciousness about health, growing preference for healthy oils, and a very powerful regulatory structure that demands transparency. The US has continued to dominate the regional market as far as consumption is concerned, with soybean oil leading the front due to high domestic production and wide usage in bakery, dairy alternatives, and food processing. Moreover, the health-conscious consumer’s focus has shifted to fortified or functional oils, which may, in time, at least in theory, provide them with wellness advantages. Additional demand has come from Canada and Mexico for processed food and animal feed oils, pushing further overall growth in North America, solidifying its uniqueness as a food and innovation hub.

Europe Leads by Example in Berth with Sustainable Practice Employing Eco-Certified Oils across the Breadth of Applications

Europe can always be singled out for the leadership it provides in all forms of sustainable endeavours regarding fats and oils, integration of green regulations, and consumer preferences. In countries like Germany, France, and the UK, eco-labelled and traceable oils, especially sunflower- and rapeseed-based over palm oil, are preferred. The implementation of the Green Deal has expedited efforts to source oils with larger council access to changes in labelling and in carbon reporting. A strong demand for olive oil stands at the top of the premium segment, grounded in Mediterranean diets and rising culinary export interest. Industrial applications like cosmetics and biobased formulations, availing elastic markets, also sustain development in Europe, as regional players also explore circular economy techniques.

Asia-Pacific Is Fast Catching Up with More Lipids Eaten in Both the Food and Feed Sectors

It is anticipated that the Asia-Pacific region would outdo other regions in growth, thanks to fast industrialisation, more consumers, and diversifying diets. Consumption is mainly driven by China and India through extensive use of oils, such as soybean and palm oil, which are very popular in the traditional cooking styles and also in pre-packed foods. The increasing use of fortified and premium oils extends with the stretching of wellness lifestyles in Japan and South Korea. Palm oil is widely consumed through imports to the region, but lately, it has gained negative political attention toward sustainable sourcing by the local administration. Refining capabilities and rising exports in the oils and fats segments in Asia-Pacific are thus solidifying the region as the engine of growth of the world.

LAMEA Shows Potential in Palm and Soybean Oil-Driven Increase in Demand in Both Food and Industrial Sectors

In their increasing urbanisation with industry following closely, Latin America, the Middle East, and Africa appear to command higher fortunes in fats and oils. Brazil stands tall, not just for vegetable oil, but particularly for soy oil. The country is the largest soybean oil-producing country. Still, Brazil has also cleverly utilised international exports to not only cater for local consumption but also to lead to some international integrated supply chains. The Middle East's edible oil reliance sees a greater reliance on packaged foods, bakery products, and confections due to imports. Africa is witnessing serious growth in soy and sunflower oils from the wave of increasing income classes and demand for a cheap cooking oil. This generation of transformation for the LAMEA region lies in strategies for diversifying demand and enhancing national investment in the fats and oils markets.

Core Strategic Questions Answered in This Report

What is the expected growth trajectory of the fats & oils market from 2024 to 2035?

The global fats & oils market is projected to grow from USD 116.70 billion in 2024 to USD 268.70 billion by 2035, registering a CAGR of 4.42%. This growth is driven by rising demand from food manufacturing, industrial applications, and fortified oil innovations, alongside a pivot toward sustainable and plant-based oils.

Q. Which key factors are fuelling the growth of the fats & oils market?

Several key factors are propelling market growth:

Rising global demand for processed foods, bakery, and dairy products
Growing preference for healthier plant-based oils and fortified alternatives
Expansion of sustainable sourcing and certification programmes
Industrial applications in feed and bio-based sectors
Regulatory compliance driving transparency and eco-labelling adoption

Q. What are the primary challenges hindering the growth of the fats & oils market?

Major challenges include:

Volatility in agricultural yields due to climate change
Sustainability concerns restricting palm oil expansion
High capital investment for refining and certification compliance
Consumer scepticism around genetically modified oilseed crops
Geopolitical risks disrupting global supply chains and trade routes

Q. Which regions currently lead the fats & oils market in terms of market share?

North America and Europe currently lead the fats & oils market. North America benefits from soybean oil dominance and a robust processed food sector, while Europe is spearheading sustainable oil adoption and eco-certified product portfolios. Asia-Pacific, however, is rapidly catching up and is expected to dominate future growth trajectories.

Q. What emerging opportunities are anticipated in the fats & oils market?

The market is ripe with new opportunities, including:

Expansion of fortified and functional oils for wellness markets
Growth of plant-based oil applications in vegan and flexitarian diets
Rising demand in the Asia-Pacific’s food and industrial sectors
Alternative oil innovations, including algae and microbial sources
Strengthened global sustainability certifications, driving eco-conscious consumer adoption

Key Benefits for Stakeholders

The report offers a quantitative assessment of market segments, emerging trends, projections, and market dynamics for the period 2024 to 2035.
The report presents comprehensive market research, including insights into key growth drivers, challenges, and potential opportunities.
Porter's Five Forces analysis evaluates the influence of buyers and suppliers, helping stakeholders make strategic, profit-driven decisions and strengthen their supplier-buyer relationships.
A detailed examination of market segmentation helps identify existing and emerging opportunities.
Key countries within each region are analysed based on their revenue contributions to the overall market.
The positioning of market players enables effective benchmarking and provides clarity on their current standing within the industry.
The report covers regional and global market trends, major players, key segments, application areas, and strategies for market expansion. Show more