North America: Vegetable Oil Consumption

Demand for vegetable oils in North America is expected to rise significantly, according to a recent report by Fortune Business Insights. Consumption amounted to 22.9 million tonnes in 2018 and is projected to reach 32.9 million tonnes by the end of 2026 (Figure 1), registering a compound annual growth rate (CAGR) of 4.7%.

This is being driven by the growing processed food and food service sectors, as well as expansion of the oil processing industry in Mexico and Canada. At the same time, there is greater awareness of the adverse health effects of consuming saturated and unrefined fats from animal sources. Resilient marketing strategies are being adopted to promote the sale of healthy vegetable oils. In 2018, food applications utilised 70% – the biggest market-share – of vegetable oils in North America.

Vegetable oils are also used for the production of biofuels and bio-based and natural products. Non-food applications are set to grow at a CAGR of 7.6% by 2026.

Palm oil, soybean oil and canola oil are popular in the bakery, food service and food processing sectors (Figure 2). In 2018, soybean oil held the biggest market-share in North America, being the most widely consumed oil across the USA and Canada. This was due to domestic production of soybean and easy availability of the oil across the region. The corn oil segment is expected to see significant growth of 6.1% CAGR by 2026.

Largest consumer
The USA is the largest consumer of vegetable oils, accounting for about 80% of the volumetric share of the regional market in 2018. This is attributed to increasing use of vegetable oils for biofuels production and in the manufacture of food products for export.

The country sustained net imports of 17 oils and fats, according to the latest US Census Bureau data. The cumulative total stood at 0.7 million tonnes for the quarter up to April/June 2019, or up 45% year-on-year. Exports, however, plunged by 23%, primarily because of soybean oil.

Malaysian Palm Oil Board statistics show that the USA is the top importer of Malaysian palm oil in North America, recording 347,393 tonnes for the first half of 2019 (Table 1). This represented an increase of 77,335 tonnes (29.6%) compared to the 270,058 tonnes imported over the same period in 2018.

Favourable prices contributed to the growth of palm oil imports. Higher demand for edible oils, including palm oil, during the summer months was another major contributor to the expansion of demand and consumption in the USA.

MPOC USA