Global Specialty Fats and Oil Market worth is expected to be USD 6.28 billion by 2026 from USD 3.2 billion in 2019, at a CAGR of 10.10 % from 2020 to 2026. An increasing gap between demand and supply of cocoa butter, (a substitute for Specialty Fats and Oils) is expected to drive the growth of the market over the projected period. Apart from this, a noticeable surge in the intake of prescribed diet and confectionery will steer the development of the Specialty Fats & Oils industry over the forecast period. Also, the rise in the foreign direct funding and alliances observed in the food industry will enlarge the market scope over the coming years. Additionally, the use of specialty fats & oils as a cocoa butter substitute will multiply the request for specialty fats & oils.
Growth Drivers
Growth in the Consumption of Confectionery and Processed Foods
Global economic development has led to growth in disposable incomes and busy routines, which has led to a surge in the request for treated food and confectionery products. The worldwide demand for confectionery and chocolates across the globe is impelling the specialty fats & oils market largely. According to the Statistical Bulletin of CAOBISCO (Association of the Chocolate, Biscuit & Confectionery Industries of the EU), the biscuits, confectionery, and chocolate industry contributed mainly towards the European economy. Intake of confectionery food products is expected to see improvement in the future, acting as an impetus for the development of the specialty fats & oils market.
Health Conscious Customers to Drive Demand
The customers have initiated following strict health norms to improve the quality of their life. In this quest, people have decreased their intake of cholesterol, which has mellowed down the recognition of traditional cooking oils. Hence, the demand for specialty oils and fats across the globe has reached new heights over the past few years. The confectionery industry has also played a vital part in improving the global market and, is expected to contribute to market development. The nutritional value in specialty oils and fats is also substantially higher than in other forms of oil, which also popularizes the former.
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Restraint
Despite the presence of many supportive factors for market growth, the supply of these products depends on good crop yield, which has been faltering in many areas because of an erratic rainfall pattern and changing climatic conditions. Moreover, agricultural land has also been decreasing. Specialty oils such as palm are subject to concerns about the release of harmful gases during their production. These reasons are likely to inhibit development during the forecast period.
Impact of COVID-19 in industry
The Specialty Fats and Oil Market is among the most open verticals to the effect of the ongoing COVID-19 outbreak and, is currently amidst exceptional uncertainty. COVID-19 is expected to significantly impact the supply chain and product demand in this sector. The supply chain and distribution network have been adversely affected.
Global Specialty Fats and Oil Market: Segmentation
Based on type, the specialty fats - oils market is segmented into specialty fats and specialty oils. The specialty fats segment is again segmented into cocoa butter equivalents, cocoa butter substitutes, cocoa butter improvers, dairy fat replacers, and other specialty fats. The specialty oils segment is further segmented into cottonseed oil, palm oil, soybean oil, coconut oil, rapeseed oil, and other specialty oils.
Based on the application, the Specialty fats - oils market is divided into chocolates & confectioneries, dairy products, bakery products, processed foods, and others. The chocolates & confectioneries segment is likely to register at the maximum production rate for the specialty fats market during the forecast period.
Based on the form of specialty fats & oils, the liquid form of specialty fats & oils is expected to rise at a higher rate. High stability oils in the liquid form support in the efficient, smooth, and fast manufacturing of sweets and bakery products. Products such as liquid limitations provide excellent moisture-holding in baked products such as cakes. These factors contribute to the adoption of the liquid form of specialty fats & oils.
Geographically, the Specialty Fats and Oil Market has been divided into North America, Europe, Asia Pacific, South America, and the Middle East & Africa. The Asia Pacific dominated the specialty fats & oils market in 2019 and is perhaps the firmest-growing market over the next six years. The growing income, higher purchasing power, the fast growth of the middle-class population, and consumer demand for treated products, ensure promising prospects for growth and modification in the region's specialty fats & oils sector. The use of specialty fats is probable to surge at a higher rate due to the demand from the chocolate & confectionery industry.
Global Specialty Fats and Oil Market: Regional Insights
The Asia Pacific dominated the regional fats & oils market and is anticipated to witness fast growth over the next six years. Emerging economies such as India, Indonesia, China and Malaysia are characterized by increasing disposable incomes, higher consumption of processed food & edible oil, and growing consumer consciousness towards health & wellness. North America and Latin America have witnessed the major shift towards substitute industrial uses of fats & oils in the recent past. In terms of revenue, Asia Pacific accounted for the maximum share in the Global Specialty Fats and Oil Market in 2019, and LAMEA is estimated to display an extraordinary development rate during the forecast period.
Competitive landscape
The leading players in the Global Specialty Fats and Oil Market are AAK AB, IOI Group, D&L Industries, Wilmar International, Mewah International, Cargill, Bunge, Manildra, Musim Mas, IFFCO, and The Nisshin Oillio Group. and other noticeable players.
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