Global Cooking Oil Market - 2023-2030

Global Cooking Oil Market - 2023-2030

Market Overview

Cooking oil is obtained primarily from plants used in baking, frying and other types of cooking. It can also be in flavorings that do not involve heating directly, such as for dressing and others. With the increase in lifestyle ailments such as diabetes, high cholesterol, and obesity, health and fitness has gained the focus of attention among individuals. They are becoming more aware of using the appropriate quantity of cooking oils. Due to this, manufacturers have produced cooking oils with less fatty matter and high nutrient value.

Growing incidences of cardiovascular diseases across the globe have caused people to consume healthy cooking oils. It can impact the growth of the cooking oil market during the assessment period. The impact of advertisements on consumers is a significant factor affecting the market's growth and is a primary driver of brand and cooking oil type switching among customers.

The global cooking oil market was valued at USD YY million in 2022. It is forecasted to reach USD YY million by 2030, growing at a CAGR of 4.56% during the forecast period (2023-2030).

Market Dynamics: Increasing consumption of processed food is expected to drive the market growth

The global cooking oil industry is anticipated to witness massive growth, mainly due to growing trends in processed food and changing food habits. Moreover, increasing urban working culture along with fast-moving lifestyles has led to limited availability of time for cooking and preparing meals. According to the U.S. Department of Agriculture (USDA), importing cooking/edible oil into developing countries is expected to increase by 34%, accounting for 79% of global import growth due to tourism and population growth. Therefore, these factors are expected to drive market growth in the coming years. Therefore, processed foods such as snacks and ready-to-eat products that require frying oil are becoming popular among urban areas, thereby driving the market for cooking oil.

The higher demand for edible oil for processed foods is already leading market players to innovate strategies for sustaining their position in the market. For instance, in May 2021, Cargill, an American privately held global food corporation, announced that they are in partnership with Frontline International, a U.S.-based creator and manufacturer of smart oil management equipment and collaboration. They launched an oil management system known as the “New Kitchen Controller oil management system.” The main aim of this system is to monitor oil filtration, disposal and automation. Also, this system helps to determine the quality of oil; therefore, it will maintain the quality and consistency of fried foods, improving profitability. These types of initiatives from market leaders are also predicted to drive market growth.

However, from a nutritional perspective, the purity of edible oils has been a concern for years. The adulteration of popular and expensive oil with cheaper oil is high, and it is a potential threat to human health. For instance, in March 2021, eight 15-liter tins of counterfeit Fortune soybean oil, a Wilmar International Ltd brand, were seized by the Indian police. In addition, a total of 119 labels and 481 round stickers were also seized from the shop worth USD 4,910. In Nigeria, palm oil counterfeiting rose in major open markets in 2020. The research showed that more than 90% of marketed oil is contaminated and improperly stored, despite palm oil’s widespread use. While the codex standards for oils are gradually changing to improve their usefulness in addressing authenticity issues, increased oil counterfeiting is expected to hamper the market growth.

Market Segmentation: Household segment is expected to hold major market share in the global cooking oil market

Households witness significant growth due to the increased use of branded oils for cooking, especially in urban households, to maintain good health. The changes in living standards have led people to choose high-quality products for their diet. According to data from Bizom, a retail intelligence platform, the sales of branded oils in India increased by 28.2% in 2020 due to consumers' shift toward in-house consumption of soft cooking/edible oils. Thus, increased household penetration and the relevance of healthy cooking are expected to lend impetus to the segment's growth. The food service sector is the fastest growing segment owing to the rising number of restaurants and fast food chains that have led the manufacturers to embrace the blending concept of two or more oils. It helps to achieve high cooking oil smoke points and balanced fatty acid levels. Furthermore, the rise in the working population has led to a shift in consumers toward such outlets for immediate food consumption, aiding the growth of this segment. Furthermore, increasing the use of vegetable oil filters by these outlets ensures the high food quality of fried food, which attracts more customers and contributes to the segment's sales growth.

Moreover, strategies are adopted by market players to stay in the competition. For instance, Adani Group, an Indian multinational conglomerate, in May 2021, announced that they had launched a mobile application that will help customers to order cooking oils under the fortune brand online from their homes. This app is available on iOS and Android. For instance, in September 2020, IFFCO acquired 3F Fuji Foods, India, from Fuji Oil Group, “A Japanese company specializing in vegetable oils and fats, industrial chocolate and emulsified. 3F Fuji Foods Pvt. Ltd is located in Hyderabad and specializes in manufacturing & distributing a range of cream products (whipping & cooking creams, soft ice cream mixes) across India. These factors strengthen the growth of the segment during the forecast period.

Geographical Penetration: Asia Pacific the dominating region during the forecast period

Asia Pacific dominated the global market and stood at USD YY million in 2021. Urbanization, dietary changes, increased prevalence of processed foods, and improved living standards primarily drive significant growth in the region. Increasing consumer interest in tasty foods with health and nutritional benefits is expected to be a major driver of market growth. The rising urbanization in China, India, and Indonesia have led consumers to shift toward processed foods. According to 2020 data from United Nations, 90% of future urban population growth will occur in Asia and Africa, which will regulate the eating pattern in the regions. The region's rapidly expanding distribution network will likely contribute significantly to sales.

Furthermore, most of the market leaders involved in the global cooking oil market are continuously implementing various effective business strategies, such as product innovations. For instance, Marico Limited, India's leading consumer goods company, offers various types of cooking oil. One of them is Saffola Gold, a cooking oil that is very healthy for the heart and body. It can improve heart health by up to 50%. It has a good source of Vitamins A & D and provides a well-balanced diet. All such elements are expected to eventually foster the Asia-Pacific cooking oil market in the upcoming years.

Europe is the second largest market and has grown rapidly in recent years, owing to rising health consciousness in consumers and their demand for cooking oils that are organic and label-claimed. The U.K., France, and Germany are among the others that import premium oils of sunflower, rapeseed, olive, and others, which contain an appropriate amount of unsaturated fats. It helps manufacturers market these oils based on these attributes, thus helping them achieve strong brand positioning and subsequent sales growth. The opportunity for peanut oil in Europe is shifting from the popular segment to the niche market. France offers an opportunity for the region for cold-pressed, virgin, and baking oils due to their health-benefiting and textural attributes. The presence of regulations associated with the sales of edible oil across the European Union to ensure high-quality products is accessible to consumers further contributes to escalating the market across the region.

Competitive Landscape:

The cooking oil market has organic and inorganic growth strategies. Various companies focus on organic growth strategies such as product launches, product approvals, and others, such as patents and events. Inorganic growth strategy activities witnessed in the market were acquisition, partnerships, and collaborations. These activities have paved the way for expanding market players' business and customer base. The market players from the cooking oil market are anticipated to have lucrative growth opportunities with the rising demand for cooking oil in the global market. Some key players in the cooking oil market are Cargill Inc., Archer Daniels Midland Company, Bunge Limited, Wilmar International Ltd., FUJI OIL CO. LTD., ConAgra Brands, Inc., IFFCO Group, Ottogi Co. Ltd., Associated British Foods plc, CJ Cheiljedang Corporation are implementing various marketing strategies, such as new product launches, geographical expansion, merger and acquisitions, partnerships and collaboration, to identify potential buyers.

For instance, on August 2021, the Government of India announced a new national plan to produce palm oil to increase agricultural income. The National Edible Oil Mission Oil Palm (NMEOOP) plan aims to achieve self-sufficiency in cooking oil with an investment of over USD 1,470.6 million. The plan is designed to encourage palm oil production, reduce reliance on imports, and help farmers profit from large markets.

In June 2021, Cargill Inc. announced its plans to build a new palm oil refinery worth USD 200 million in Lampung, Indonesia, to meet the growing demand for sustainable and traceable edible palm oil. The company is eyeing South-East Asian countries for business expansion as they offer opportunities due to their favorable weather conditions, growing economy, and rising population.

In November 2021, Cargill acquired an edible oil refinery in Nellore in Andhra Pradesh. Cargill’s investment to acquire and upgrade the facility will significantly expand its edible oil production capacity and footprint in southern India and strengthen its existing supply chain to meet growing customer demand.

COVID-19 Impact: Positive impact on the global cooking oil market

The increase in people eating at home led to increased household cooking/edible oil consumption per capita owing to the initial stockpiling and panic purchasing, storage and the shift from food service to retail. It is one of the first categories limited to each customer in large retail chains. According to the Chinese National Bureau of Statistics, in 2020, food products retail sales in China had grown by 9.7%, and the oil section was a part of this surge. In addition, the price of oil has risen sharply amid the pandemic. According to the Department of Consumer Affairs of India, groundnut, soya, sunflower, palm, and mustard oil prices rose from 20% to 56% in 2020. The prices soared in the U.S., Brazil, and other international markets due to export duties, labor issues, and poor rapeseed and sunflower seed harvests in Europe and the Black Sea region. Furthermore, COVID-19 and the resulting lockdown of countries in the region led to a shift toward consumer purchases of packaged food products for home consumption, further driving the sales of cooking for food processing.

The global cooking oil market report would provide access to approximately 69 market data tables, 71 figures and 170 pages