U.S. Plant-based Oils Market Size, Share & Trends Analysis Report By Source (Palm Oil, Soybean Oil, Sunflower Oil), By Application (Food, Industrial, Animal Feed), And Segment Forecasts, 2020 - 2027

Report Overview

The U.S. plant-based oils market size was estimated at USD 14.07 billion in 2019. It is expected to expand at a compound annual growth rate (CAGR) of 0.5% from 2020 to 2027. Factors, such as the rapid growth of the food processing industry and increasing penetration of alternate fuel sources like biodiesel in the U.S. are expected to have a positive impact on market growth. Plant-based oils are primarily used in food product preparation including confectionery, bakery, dairy, and others. The steady growth in the food processing industry that uses plant-based oils for the deep-frying process is the key driver for the growth. The rising prevalence of cardiovascular diseases and increasing health awareness are the factors expected to fuel the demand for healthy oils such as olive oils. Also, plant-based oils are used in the production of biodiesel and oleochemicals. Higher demand for alternate and sustainable fuel is expected to increase the demand for plant-based oils in the U.S.

Plant-based oils are majorly produced from the soybean, sunflower, palm, coconut, olive, cottonseed, rapeseed, and others. Several manufacturers have successfully achieved backward integration and are cultivating raw materials. For instance, Wilmar International Limited has palm plantations spread across 232,940 hectares in countries including Indonesia, Malaysia, and some African countries.

Plant-based oils are primarily extracted using two processes, namely hydraulic or screw press-based process and solvent-based process. The hydraulic process is traditionally being used over a long period. Manufacturers are emphasizing more on the oil refining process to achieve maximum yield and reduce the manufacturing costs. Manufacturers are using the enzymatic degumming process over the traditional water or chemical degumming. Enzymes specifically target phospholipid impurities in oil leaving the major part of the oil untouched.

Fluctuating prices of raw materials is the major challenge faced by the industry. Changing climatic conditions impact the production output of raw materials, like soybean, sunflower, and others. Thus the raw material availability, along with its quality, are the key factors determining the final product cost.

An unprecedented outbreak of COVID 19 has temporarily affected the trade activities and the functioning of major oil manufacturers. The U.S. is the worst-hit country by COVID 19, with 12.8 million confirmed cases as of November 2020. Lockdown imposed due to the outbreak has affected the demand for plant-based oil from various food processing and industrial applications.

Source Insights

Soybean oil dominated the U.S. plant-based oils market with a revenue share of 55.24% in 2019 is expected to maintain a leading position over the forecast period. The U.S. is one of the largest producers of soybean leading to higher domestic consumption and high popularity. The country produced nearly 11.0 million tons of soybean in 2019, of which 7.7 % volume, was exported to various countries.

Rapeseed oil, also known as canola oil, is the second-largest consumed oil in terms of revenue in the U.S. The country is one of the leading importers of rapeseed oil, with imports levels nearing 1.8 million tons. Canada is the major rapeseed oil trade partner of the U.S. High health benefits and the wide availability of rapeseed oil in the neighboring countries is responsible for the high market share.

Palm oil is expected to witness the highest CAGR of 0.8% over the forecast period. Prices of palm oil are significantly lower than the other plant-based oil owing to cheap raw material available from the tropical region. Palm oil yield per hectare is highest compared to the other plant-based oil, which contributes to the lower cost. Cottonseed oil is one of the fastest-growing plant-based oil in the U.S., owing to the health benefits including anti-inflammatory effects and reduced risk of heart diseases when consumed in a limited amount.

Other plant-based oils include corn, mustard, algae, sesame, and peanut oil. Corn oil is expected to witness increasing demand owing to the presence of heart-healthy ingredients like vitamin E, phytosterols, and linoleic acid. Also, Sesame, mustard, and peanut oil are expected to gain popularity owing to high antioxidant content and their ability to maintain cholesterol levels in the body.

Application Insights

In 2019, food application dominated the market with a revenue share of over 68% and is expected to maintain the leading position by 2027. These oils have a high demand for the production of bakery, confectionery, dairy, and processed foods. Processed foods, which include products like salad dressings, margarine, mayonnaise, cookies, etc., dominated the food segment. Food processors prefer plant-based oil owing to their wide availability and polyunsaturated fatty acids content, which help in maintaining heart health.

The industrial application for the product is expected to witness the highest CAGR over the projected period. The segment consists of biodiesel and oleochemicals, of which biodiesel is expected to dominate in terms of market share and growth rate. Plant-based oils are derived from renewable sources such as plant fruits and seeds and have high energy content making them ideal for the production of biodiesel.

Oleochemicals are vegetable oil derivatives and are used as a raw material for the production of plastic additives, adhesives and sealants, coating and inks, agricultural chemicals, and lubricants. The robust industrial manufacturing sector in the country, which demands a high amount of oleochemicals is expected to a driving factor for the industry.

Furthermore, plant-based oils are also used as part of animal feed to enhances the utilization of dietary energy, improves digestion, increases animal stamina, and aids in the absorption of essential vitamins. Fat is an essential component in the animal diet, as it provides necessary fatty acid, enhances the utilization of dietary energy, increases animal stamina, digestion improvement, and helps in the absorption of essential vitamins. The U.S. animal feed industry is witnessing significant growth owing to the rising adoption of pets in the country. Increasing livestock production to meet the high demand for meat and dairy products is expected to increase the demand for animal feed in the country.

Key Companies & Market Share Insights

The market is highly consolidated owing to the presence of big players including ADM; CHS Inc.; and Ag Processing Inc. Increasing importance of plant-based oils as a functional ingredient in a food product is anticipated to create opportunities and intensify the competition in the U.S. market.

Recently, companies like ADM, Cargill Inc, Westmill Food have made significant investments significantly in the development and expansion of Non-GMO and Low cholesterol plant-based oil. Busy lifestyle and changing diet preferences in the working professionals in the U.S. is expected to increase the manufacturer's investments in coconut, olive, and sunflower oil production. Some prominent players in the U.S. plant-based oils market include:

• ADM

• Bunge Limited

• Wilmar International Ltd

• Cargill, Incorporated

• Westmill Foods

• CHS Inc.

• FUJI OIL ASIA PTE. LTD.

• Ag Processing Inc a cooperative

• Riceland Foods

• ACH Food Companies, Inc.

• Viterra Inc.

U.S. Plant-based Oils Market Report Scope

Segments Covered in the Report

This report forecasts volume and revenue growth on the country level and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For this study, Grand View Research has segmented the U.S. plant-based oils market based on source, and application.

• Source Outlook (Volume, Thousand Tons; Revenue, USD Million, 2016 - 2027)

  • Palm Oil

  • Soybean Oil

  • Sunflower Oil

  • Rapeseed Oil

  • Olive Oil

  • Coconut Oil

  • Cottonseed Oil

  • Others

• Application Outlook (Volume, Thousand Tons; Revenue, USD Million, 2016 - 2027)

  • Food

    • Confectionery

    • Bakery

    • Dairy Products

    • Processed Food

    • Others

  • Industrial

    • Biodiesel

    • Oleochemicals

  • Animal Feed