Edible Animal Fat Market Size, Share & COVID-19 Impact Analysis, By Type (Butter, Tallow, Lard, and Others), By Source (Cattle, Pig, and Others), By Applications (Food and Non-Food) and Regional Forecast, 2021 – 2028

The global edible animal fat market size was USD 41.50 billion in 2020. Due to the zoonotic origin of COVID-19, its outbreak has impacted global market growth. Based on our analysis, the global market exhibited a huge decline of 15.0% in 2020. This could be mainly attributed to the altered meat consumption habits, decline in animal fat demand, and animal by-product prices. The market is projected to grow from USD 45.65 billion in 2021 to USD 63.98 billion in 2028 at a CAGR of 4.9% during the 2021-2028 period. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

The importance of animal fat in the production of different food products drives the growth of the market. Animal fats are used for cooking, baking, and frying. Along with other components, edible animal fats are used in meat products, margarine, bakery products, sauces, and soups. Due to their excellent taste and texture, these fats are widely used in food service and households and have high demand in animal feed applications. Hence, these factors have boosted the growth of the market.

COVID-19 Impact on Meat Production and Consumption to Reduce the Availability of Edible Animal Fat

COVID-19 has affected many people and their businesses. In several countries, the functioning of slaughterhouses was also impacted due to government-imposed lockdown and shortage of laborers. The impact on slaughterhouses further had a negative effect on the production of animal fat. Also, according to the Food and Agriculture report, many new human diseases are directly linked to food and ingredients of animal origin; this further reduced meat consumption in many nations.

Therefore, the impact on meat production and consumption has further led to a reduction in animal fat availability for human consumption.

LATEST TRENDS

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Urbanization and Rising Income are an Emerging Trend

In developing nations, rising income has led to an increase in the availability and consumption of energy-rich high-fat diets. This has led to the increasing consumption of a fat-based diet in the key regions such as South and South-Eastern Asia and the Middle East Asia.

In addition to the rising income, urbanization has played an important role and has impacted dietary fat consumption in developing and transition economies. Urbanization has stimulated improvement in infrastructure, including cold chains that permit trade in perishable goods. Compared with a less diversified diet in rural communities, the city dwellers consume a varied diet rich in animal proteins and fats. According to the World Health Organization (WHO), the American, Asian, and European regions are large consumers of animal products.

Thus, the trend of urbanization and the rising disposable income in developing nations would support the global edible animal fat market growth.

DRIVING FACTORS

Increasing Adoption in Food Industry to Augment Growth

Edible animal fats are considered to be rich sources of energy, vitamins, and fatty acids. Moreover, they help in enhancing food taste and texture. Thus, many food processors and bakery producers prefer these fats such as tallow and butter. Besides, animal fats contain significant levels of oleic acid, which is associated with various health benefits.

Consumable animal fats such as tallow and lards are highly preferred during food production due to their appealing taste and excellent cooking and baking properties. For instance, tallow is considered an outstanding frying agent due to its ability to withstand high cooking temperatures and reduce oxidation sensitivity. Whereas lards soft consistency and crystalline structure make it suitable fat for shortening pastry. Therefore, chefs and home cooks constantly choose animal fats for their superior flavor and texture.

In Germany and France, goose fat and lard are popular spreads, while in America, tallow is used as frying French fries. Hence, the high adoption of animal fats in the food industry is likely to boost its demand worldwide.

Growing Preference for Sustainable Animal Fat Oil to Propel Market Growth

According to the European Food Hygiene Regulations, edible animal fats are obtained from animals specifically bred, reared, slaughtered, and processed for human consumption. Also, unlike vegetable oils, particularly palm and sunflower oil that are specifically cultivated for their oil content. Further, animals that produce these fats are raised and nurtured predominantly for their dairy, meat, and wool. Thus, animal fats are responsible for the environmental cost of animal husbandry with their co-products.

Besides, the proportion that each product endures is frequently based on the economic value of these fats. Therefore, co-products such as animal fats are held responsible for a smaller share of the overall impact on the environment. Furthermore, the carbon footprint of most animal fats is less as they are produced using renewable energy derived from animal by-products. Therefore, such animal fats are considered sustainable when compared to vegetable oils such as palm, sunflower, and coconut. This is expected to contribute to the growth of the global market in the forthcoming years.

RESTRAINING FACTORS

Rising Health Concerns to Limit Growth

Consumers across the world are becoming highly conscious about the foods and food ingredients used. Hence, food manufacturers are very cautious while developing any product. Also, the health problems resulting from high consumption of animal products lead to a reduction in the use of saturated fats. For instance, in the late 1950s and early 1960s, cholesterol consumption was related to heart disease, according to nutritionists. Hence, the food industry decreased the usage of animal fats in animal foods.

Since solid fats play a key role in some foods, vegetable oils such as palm oil, palm kernel oil, coconut oil, and partially hydrogenated oils started replacing animal fats. Therefore, these factors are likely to impede the growth of the market during the forecast period.

SEGMENTATION

By Type Analysis

Butter Segment to Dominate Owing to Greater Application in Food Industry

Based on type, the market is segmented into butter, lard, tallow, and others. 

The butter segment is likely to gain significant edible animal fat market share due to its higher price per metric tons and the rising consumer spending.

The lard segment is the second-largest segment. Lard is used in many cuisines as shortening or cooking fat. In some instances, lard is used as a replacement for butter, and hence, it is highly preferred in western cuisines. According to our analysis, Europe, Asia Pacific, South America, and the Middle East, and Africa are the major consumers of lard as animal fat.

By Source Analysis

Cattle Segment to Hold Highest Share Owing to Increased Demand for Butter and Tallow

Based on source, the market is segmented into cattle, pig, and others.

High consumer preference for cattle-based animal fat such as butter and tallows makes the cattle a dominant segment. Also, cattle animals are widely available, thereby leading to greater availability of animal fats.

The pig segment is driven by increasing demand for lard, which has high application in the food industry for frying, roasting, grilling, and baking.

By Application Analysis

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Non-Food industry to Exhibit Fastest Growth due to its Increased Application in animal feed

Based on application, the market is segmented into the food and non-food industry.

Being fit for human consumption, edible animal fat has high application in the food industry. Thus, the food industry is likely to hold a major share in the market.

The application of edible animal fat in the non-food industry is likely to grow in the future due to its high demand in the animal feed and oleochemicals industry.

REGIONAL INSIGHTS

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Asia Pacific stood at USD 12.64 billion in 2020 and is likely to dominate the global edible animal fat market in the forthcoming years. This dominance is attributed to the high consumption of butter and lard in countries such as China, India, Australia, and other South-East Asian countries. The demand is further driven by the increasing utilization of animal fats in the bakery industry.

North America is expected to hold a significant share in the market due to the increasing utilization of animal fat in both the food and non-food industry. Among all animal fats, butter is highly preferred by consumers in the U.S and Canada. Furthermore, along with butter, the demand for tallow and lard is high for other industrial applications such as animal feed and oleochemical industry. However, strict regulation in the country for dietary fats is likely to restrain the market growth.

The market in Europe is mainly driven by the large utilization of the product across the foodservice industry in countries such as Germany, Russia, U.K., and Belgium. In U.K. and Belgium, tallow is used to prepare fish, chips, and french fries. While in Germany and France, animal fats such as lard and duck fat are used as spreads. Household cooking, bakery, confectionery, and foodservice channels are the major consumers of edible animal fats in the region.

Butter is the major animal fat consumed in South America, and its high consumption is driven by changing perceptions around the health impact of butter. Brazil is the key country in the region. The demand for the product is primarily driven by increased fat intake as a source of calories and the substitution of animal fats with vegetable fats.

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Lower prices compared to vegetable oils and the ability to withstand high cooking temperatures can boost the demand in the Middle East and Africa. Turkey, Saudi Arabia, United Arab Emirates, Egypt, Morocco, and Iran are key consumers.

KEY INDUSTRY PLAYERS

Companies Focus on Expansions for Broadening their Share in the Global Market

In the global market, few key players such as Cargill, Inc, SARIA Group, and Ten Kate Holdings hold significant shares due to their wide geographical presence, huge customer base, and strong brand reputation. These leading players are focusing on growing their market share in the global market by expanding. For instance, in July 2019, PTUE SARIA, a part of the SARIA Group, opened a new production facility in Belarus for manufacturing products with animal-by products as a raw material.

LIST OF KEY COMPANIES PROFILED:

• Ten Kate Holdings (Musselkanaal, Netherlands)


• Cargill, Inc. (Wayzata, United States)


• Darling Ingredients, Inc. (Irving, United States)


• Archer Daniels Midland Company (Chicago, United States)


• Bunge Limited (Chesterfield, United States)


• Sanimax (Montréal, Canada)


• Baker Commodities Inc. (Vernon, United States)


• York Foods Pty Ltd (Goulburn, Australia)


• Saria Group (Selm, Germany)


• Colyer Fehr Tallow Pty Ltd. (Mount Druitt, Australia)

KEY INDUSTRY DEVELOPMENTS:

• November 2018 - Darling Ingredients, Inc., a U.S.-based producer, and developer of sustainable ingredients acquired PPH Conto Ltd, a Poland-based food-grade animal processor.


• September 2017: SARIA Polska, part of SARIA Group, merged with JKK Group, a Poland-based company. This merger is expected to propel SARIA Polska to expand its product portfolio.

REPORT COVERAGE

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The edible animal fat market research report provides a detailed analysis of the market and focuses on key aspects such as competitive landscape, type, source, and application. Besides this, it offers insights into the market trends and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several factors contributing to the market's growth in recent years.

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