PHO and Non-PHO-based Oil and Fat Market

PHO- and Non-PHO-based Oil and Fat Market Outlook (2024 to 2034)

The valuation of the global PHO and non-PHO-based oil and fat market is estimated at US$ 269.5 billion in 2024. Worldwide revenue is projected to reach US$ 469.2 billion by the end of 2034, increasing at a CAGR of 5.7% between 2024 and 2034.

PHOs are oils and fats with an iodine value (IV) greater than 4 that have undergone hydrogenation but have not reached full or nearly full saturation. PHOs are the main dietary source of trans-fatty acids produced industrially because, in contrast to other edible oils, they are naturally trans-fatty acid-containing and are purposefully produced to alter the qualities and functionality of the oils as well as the food to which they are added.

Key Market Growth Drivers

• PHO and non-PHO-based oil and fat market growth is largely driven by regulatory changes about trans fats. Partially hydrogenated oils, or PHOs, have long been used in the food industry but are currently being phased out because of their detrimental effects on health, especially cardiovascular health.
• Food makers are forced to find substitute fats and oils that do not contain trans fats as governments and health organizations are imposing stricter regulations or outright banning PHOs.
• There is a significant market need for oils and fats that are not derived from PHO as a result of this regulatory push. Food manufacturers are searching more and more for healthier substitutes that have the same functional qualities as PHOs but none of the negative health effects.
• The rising popularity of non-PHO-based oils and fats is also attributed to consumer awareness of and preference for healthier food options.
• Consumers are actively looking for products that use healthier fats and oils as they are becoming more aware of the health risks linked to trans fats, thus setting PHO- and non-PHO-based oil and fat market trends. Food producers are further encouraged to reformulate their products with non-PHO alternatives as a result of this shift in consumer demand.

Report Attribute	Detail
PHO- and Non-PHO-based Oil and Fat Market Size (2024E)	US$ 269.5 Billion
Forecasted Market Value (2034F)	US$ 469.2 Billion
Global Market Growth Rate (2024 to 2034)	5.7% CAGR
East Asia Market Share (2024E)	22.4%
North America Market Share (2024E)	23.9%
Sales of Partially Hydrogenated Oils (2024E)	US$ 125.3 Billion
Key Companies Profiled	Oleo-Fats Inc.; De Wit Specialty Oils; Mewah International Inc.; IOI Corporation Berhad; Archer-Daniels-Midland Company; Bunge Ltd.; AAK AB; The Hain Celestial Group Inc.; Ventura Foods; IFFCO Group; 3F Industries Limited; Musim Mas Holdings; Fuji Oil Holdings Inc.

What is Driving Popularity of PHO- and Non-PHO-based Oils and Fats?

“Focus on Gradually Eliminating Trans Fats from Food and Non-Alcoholic Beverages”

Concerned food safety authorities and organizations have been taking action to limit the use of trans-fatty acids in most consumed food products because of the rise in some deadly diseases linked to the consumption of fatty food products. Leading the charge to restrict the use of trans-fatty acids in food production, the WHO has caused a sharp drop in the market for PHO oils, which in turn has increased demand for non-PHO-based oils and fats.

• In response to WHO guidelines against trans-fat consumption, the food safety regulatory body in India, FSSAI (Food Safety and Standards Authority of India), which also happens to be one of the largest markets for fats and oils, had set guidelines to limit trans fats in oil by 2% by 2022. Currently, trans fats are permitted at a level of 5%. The study on the worldwide market for PHO and non-PHO-based oils and fats goes into great detail about these laws and includes the most recent data on the anti-trans-fatty acid laws of the major nations that have put them into effect.

Leading food and non-alcoholic beverage manufacturers are gradually removing trans fats from their products as part of the WHO's objective to eradicate industrially produced trans-fat by the end of 2023.

What are the Key Challenges Faced by Producers of PHO- and Non-PHO-based Oils and Fats?

“Regulatory Restrictions and High Cost Associated with Reformulation Efforts”

One of the most significant challenges is the increasing regulatory restrictions on trans fats, which are found in PHOs. Since PHOs are linked to cardiovascular disease and other health risks, many countries have either outlawed them completely or are in the process of doing so. It is necessary to find substitute ingredients or reformulate products to comply with these regulations.

Consumer awareness of the dangers trans fats are posing to their health is rising due to this, there is a high demand from consumers for healthier food options, such as those that are either completely free of trans fats or have substantially lower trans-fat content. To meet the demands of health-conscious consumers, suppliers are providing alternatives.

Suppliers are facing high costs and time commitments when reformulating products to eliminate or reduce PHOs. To find suitable replacements that preserve the functionality, flavor, and texture of the original products, research and development efforts are necessary. Additionally, retooling manufacturing processes and retraining employees are also incurring costs, thus impeding the expansion of the PHO- and non-PHO-based oil and fat market size.

Country-wise Insights

North America is expected to hold 23.9% of the global PHO- and non-PHO-based oil and fat market share in 2024. Food safety regulations in several parts of the world are creating a positive impact on the market. The PHO- and PHO-based oil and fat market in East Asia is projected to expand at a CAGR of 6% from 2024 to 2034.

Several countries in East Asia, including Japan, South Korea, Taiwan, and China, are implementing or are considering regulations to reduce trans fats in food products. Since PHOs have detrimental effects on health, the regulatory environment is becoming more and more restrictive, promoting the use of non-PHO alternatives.

Why is Consumption of PHO- and non-PHO-based Oils and Fats Rising in the United States?

“PHO- and non-PHO-Based Oils and Fats Popular among Sports Enthusiasts”

Attribute	United States
Market Value (2024E)	US$ 28.7 Billion
Growth Rate (2024 to 2034)	6.1% CAGR
Projected Value (2034F)	US$ 52 Billion

The United States is poised to hold a significant market share of 44.5% in North America in 2024. The United States FDA's determination that partially hydrogenated oils (PHOs) are not generally recognized as safe (GRAS) for use in human food has resulted in regulatory actions to limit their presence in the food supply. As a result, suppliers and manufacturers are actively looking for substitute oils and fats that don't contain PHOs.

What is the Sales Outlook for PHO- and Non-PHO-based Oils and Fats in Japan?

“Strict Regulations to Minimize Use of Trans Fats in the Country”

Attribute	Japan
Market Value (2024E)	US$ 17.4 Billion
Growth Rate (2024 to 2034)	6.2% CAGR
Projected Value (2034F)	US$ 31.9 Billion

To inform consumers and incentivize food manufacturers to reduce the amount of trans fat in their goods, Japan is implementing new labeling regulations for foods containing trans fats in 2023. This push for regulations is in line with global movements to minimize trans fats encouraging the use of non-PHO substitutes.

Consumers in Japan are becoming more conscious of the dangers trans fats pose to their health, especially their effects on cardiovascular health. The market for non-PHO-based oils and fats is growing as a result of this awareness, which is increasing demand for goods that are labeled as trans-fat-free or have lower levels of trans fats.

Category-wise Insights

The PHO- and non-PHO-based oil and fat market is categorized based on application and product type. In terms of product type, the market is categorized into partially hydrogenated oils and non-partially hydrogenated oils. Application-wise, it is segmented into industrial, commercial, and household, of which commercials account for hotels, restaurants, and cafes are expected to hold 43.4% of the global market in 2024.

Why are Sales of Non-Partially Hydrogenated Oils Rising Steadily?

“Superior Nutritional Profiles and Healthier Lipid Profile”

Attribute	Non-Partially Hydrogenated Oils
Segment Value (2024E)	US$ 144.2 Billion
Growth Rate (2024 to 2034)	5.6% CAGR
Projected Value (2034F)	US$ 247.7 Billion

Non-partially hydrogenated oils (non-PHO oils) provide several advantages over partially hydrogenated oils (PHOs), particularly in terms of health and functionality. The fact that non-PHO oils do not contain trans fats is one of their biggest benefits. Trans fats are known to raise LDL cholesterol levels, which are commonly referred to as "bad" cholesterol, and lower HDL cholesterol levels, which are considered "good" cholesterol. These effects can raise one's risk of developing heart disease. Using non-PHO oils to replace trans fats in the diet promotes heart health and lowers the risk of cardiovascular disease.

Due to their superior nutritional profiles, non-PHO oils and fats-such as high oleic oils or blends of healthier vegetable oils, are recommended. When compared to PHOs, non-PHO oils typically have a healthier lipid profile. Higher amounts of monounsaturated and polyunsaturated fats, which are good for the heart when eaten in moderation, are usually found in them. These beneficial fats can enhance overall lipid profiles and assist in lowering LDL cholesterol levels.

Why is the Foodservice Industry a Key End Use in This Market?

“High Consumer Demand for Healthier Food Options”

Attribute	Commercial
Segment Value (2024E)	US$ 117 Billion
Growth Rate (2024 to 2034)	6.2% CAGR
Projected Value (2034F)	US$ 214 Billion

Several regions across the globe are enacting regulations limiting the use of PHOs due to their negative health impacts. These regulations apply to commercial food service operators as well, and as a result, there has been a shift toward non-PHO alternatives that either contain no trans fats at all or significantly less. Across the commercial segment, consumers and institutions are increasingly preferring healthier food options.

Customers who are concerned about their health are becoming more aware of the dangers of trans fats and actively seeking out restaurants that use healthier fats and cooking oils. Suppliers of non-PHO fats and oils are essential in helping commercial foodservice operators by offering product knowledge, assistance with technical issues, and menu reformulation help. They work closely with kitchen staff and chefs to ensure that healthier fats and oils are seamlessly incorporated into menu items without sacrificing quality or taste.

Competition Analysis

To meet consumer demands for improved nutrition and ingredient transparency, key players in the PHO- and non-PHO-based oil and fat market are providing healthier options to consumers.

• In June 2021, Cargill announced plans to construct a new US$ 200 million palm oil refinery in Indonesia to expedite the development of a sustainable palm supply chain and offer customers verified products free of deforestation.
• To satisfy the rapidly increasing demand from customers in the food, feed, industrial, and biofuel sectors-including those who produce renewable diesel-ADM intended to construct its first-ever dedicated soybean crushing and refinery in the United States in May 2021.

Fact.MR provides detailed information about the price points of leading manufacturers of PHO- and Non-PHO-based oil and fat positioned across the world, sales growth, production capacity, and speculative technological expansion, in this updated market report.

Segmentation of PHO- and Non-PHO-based Oil and Fat Market Research

• By Product Type :

  • Partially Hydrogenated Oil
  • Non-Partially Hydrogenated Oil

• By Application :

  • Industrial
  • Commercial
  • Household

• By Region :

  • North America
  • Western Europe
  • Eastern Europe
  • Latin America
  • East Asia
  • South Asia & Pacific
  • Middle East & Africa