Liquid Shortening - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2026-2031)

The liquid shortening market size was valued at USD 0.84 billion in 2025 and estimated to grow from USD 0.88 billion in 2026 to reach USD 1.17 billion by 2031, at a CAGR of 5.78% during the forecast period (2026-2031). This report is segmented by Source (Vegetable-Based, Animal-Based, and Blended Oils), Application (Bakery Products, Confectionery, Snacks and Savory, Frozen Desserts and Ice Cream, Ready To Eat and Prepared Meals, Other Applications), and Geography (North America, Europe, Asia-Pacific, South America, and the Middle East and Africa). The Market Forecasts are Provided in Terms of Value (USD).

Global Liquid Shortening Market Trends and Insights

Rising Demand from the Commercial Bakery Industry

Commercial bakeries continue to drive significant demand in the liquid shortening market. Solid block shortenings do not integrate easily with high-speed automated dosing systems. In contrast, pumpable liquid products connect directly to continuous mixing and weigh-batching equipment, reducing manual handling and ingredient losses. This advantage supports investments in liquid-shortening infrastructure across large bakeries in Europe, North America, and Southeast Asia. Manufacturers in India, Vietnam, and Indonesia are also adopting bulk liquid supply formats as organized food channels expand. High-performance frying requirements further strengthen demand, as industrial snack and foodservice lines need consistent flow, extended fry life, and oxidative stability. For bakery operators, liquid shortening delivers value through predictable processing rather than a simple change in ingredient format. Bulk delivery also reduces the need to store and manually break solid blocks before production. These operational benefits make liquid products more relevant as facilities increase throughput and standardize recipes across sites.

Growing Adoption of Non-Hydrogenated and Trans-Fat-Free Formulations

Regulation continues to shape product development in the liquid shortening market. In April 2024, the Food and Drug Administration finalized the revocation of prior sanctions related to the use of partially hydrogenated oils in certain foods or as a direct or indirect food substance. Research based on scanner data found that compliance gaps persisted among some smaller retailers and private-label supply chains, creating opportunities for compliant suppliers. Early replacements based on fully hydrogenated oil blends created texture and stability challenges in some bakery applications. As a result, demand remains strong for stable, non-hydrogenated liquid formulations and vegetable-based blends that meet labeling requirements. Suppliers must preserve aeration, texture, and shelf stability while removing ingredients that are no longer acceptable. This technical requirement makes reformulation an ongoing process rather than a one-time regulatory response. It also favors suppliers that can tailor fats to specific bakery and prepared-food applications.

Volatility in Vegetable Oil Prices

Vegetable oil price volatility remains an immediate commercial constraint on the liquid shortening market. The Food and Agriculture Vegetable Oil Price Index reached 192.0 points in June 2026, 23.3% above its June 2025 level. The increase in the index reflected the combined effect of higher palm and rapeseed oil quotations and broadly stable sunflower oil prices, which more than offset lower soy oil prices. Producers without long-term coverage may face pressure from higher input costs and industrial customers that resist price increases. This pressure may encourage the use of blended and non-palm formulations when they provide a more manageable cost and supply profile. It may also make vertical integration and hedging more important competitive tools. Food manufacturers often require stable supply terms, as sudden cost changes can disrupt pricing for bakery, snack, and prepared meal products. Suppliers that offer multiple oil bases can respond more effectively when one input becomes scarce or expensive. As a result, procurement decisions increasingly consider supply resilience alongside product performance.

Other drivers and restraints analyzed in the detailed report include:

• Surging Consumption of Convenience and Ready-To-Eat Foods
• Innovation in Vegetable-Based and Blended Oil Formulations
• Sustainability Concerns around Palm Oil Production

Segment Analysis

Vegetable-based products accounted for 82.42% of the liquid shortening market size in 2025. This position reflects the wide availability of soybean, canola, palm olein, and sunflower oils for commercial bakery, frying, and prepared-food production. Their functional range supports use across multiple processing conditions. Palm-derived products face greater scrutiny in Western markets due to deforestation-related compliance requirements. Canola and high-oleic sunflower variants are gaining attention as buyers seek different sourcing and nutritional profiles. Animal-based liquid shortenings remain a niche option in traditional frying applications in North America and South America. Manufacturers use them where lard-based fats provide flavor characteristics that vegetable alternatives do not replicate. The liquid shortening industry continues to rely on vegetable inputs because processors can manufacture them at an industrial scale.

Blended oils are forecasted to grow at a CAGR of 6.81% from 2026 to 2031. Producers combine base oils with high-oleic variants, interesterified fractions, and emulsifier systems to meet targeted performance requirements. These combinations can support fatty-acid targets while maintaining labeling compliance. Scientific research supports their potential to preserve structural and sensory performance with lower saturated-fat content. Interesterification and fractionation provide established routes for trans-fat-free alternatives. Blends can also reduce dependence on a single raw material when supply conditions change, making them relevant to manufacturers serving regulated export markets. The liquid shortening industry is using these systems to address both technical and procurement requirements. The commercial value depends on whether suppliers can deliver these benefits consistently at the volumes required by large food manufacturers. Development teams must evaluate each blend against the customer’s process conditions rather than assuming that a lower-cost oil substitution will be suitable. This creates a role for pilot testing and technical collaboration before a formulation moves into routine supply.

Complete Report Scope:

• By Source
  • Vegetable-based
  • Animal-based
  • Blended Oils
• By Application
  • Bakery Products
  • Confectionery
  • Snacks and Savory
  • Frozen Desserts and Ice Cream
  • Ready to Eat and Prepared Meals
  • Other Applications
• By Geography
  • North America
    • United States
    • Canada
    • Mexico
    • Rest of North America
  • Europe
    • Germany
    • United Kingdom
    • Italy
    • France
    • Spain
    • Netherlands
    • Poland
    • Belgium
    • Sweden
    • Rest of Europe
  • Asia-Pacific
    • China
    • India
    • Japan
    • Australia
    • Indonesia
    • South Korea
    • Thailand
    • Singapore
    • Rest of Asia-Pacific
  • South America
    • Brazil
    • Argentina
    • Colombia
    • Chile
    • Peru
    • Rest of South America
  • Middle East and Africa
    • South Africa
    • Saudi Arabia
    • United Arab Emirates
    • Nigeria
    • Egypt
    • Morocco
    • Turkey
    • Rest of Middle East and Africa

Geography Analysis

Asia-Pacific accounted for 36.73% of the liquid shortening market size in 2025 and is forecast to grow at a CAGR of 6.43% through 2031. This position reflects the expansion of food processing, rapid urbanization, and rising demand for non-hydrogenated alternatives. China, India, and Southeast Asian countries remain central to regional demand. India’s trans-fat limit continues to support reformulation in bakery shortening and vanaspati applications. Indonesia’s biodiesel policy may tighten palm oil availability for food applications while supporting investment in downstream refining. Cargill’s planned refinery investment in Lampung reflects continued interest in Indonesia’s downstream palm oil value chain.

North America is the second-largest regional area in the liquid shortening market. High per-capita bakery and foodservice consumption supports demand, along with an established cold chain. Industrial bakeries and quick-service restaurant chains use non-hydrogenated liquid frying shortenings in high volumes. Specialty customers are also adopting high-oleic formulations. Europe has a mature bakery and confectionery base, along with strict sustainability-linked sourcing expectations. Buyers in the region are shifting toward certified and palm-reduced formulations as European Union traceability requirements take effect. This shift creates a procurement environment distinct from regions where price and local availability have greater influence. Suppliers that can document their inputs and offer alternatives have a clearer route to European customers. The region, therefore, remains important for premium and compliance-led product development.

South America and the Middle East and Africa are smaller but growing regions in the liquid shortening market. Brazil has a developed fast-food culture and an expanding food-processing sector, which support commercial demand for liquid shortening products. The Gulf Cooperation Council has large foodservice and institutional catering operations that require consistent industrial supplies. Import-dependent markets remain more exposed to vegetable oil cost volatility, which can increase interest in blended formulations that offer supply flexibility. The liquid shortening market also rewards suppliers that can adjust formulations quickly for local customers. Local demand patterns also vary across bakery, quick-service restaurant, institutional catering, and packaged food channels. A formulation that meets regional expectations for handling and finished-food quality can help a supplier build longer customer relationships in the liquid shortening market.

List of Companies Covered in this Report:

• Marina Foods Inc,
• Spectra Foods
• AAK AB
• Cargill, Incorporated
• Stover & Company
• Ventura Foods
• PASTORELLI FOODS LLC
• Catania Oils
• American Vegetable Oils, Inc
• Bakers Authority
• Bunge Limited
• Perfecta
• Golden Agri-Resources Ltd.
• Puratos Group
• Versa
• First Street
• Kirkland
• Manildra Group
• Vantage Specialty Chemicals, Inc.,
• Oasis

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support