Shortening and Bakery Products Market set to Rise US$1.24bn

The global shortening market is rapidly expanding, as changing tastes and innovation are projected to drive growth of US$1.24bn by 2027.
According to Technavio, the global research and advisory firm, shortening, which is the solid fat used in baking to create tender and flaky textures in pastries and baked goods, is experiencing a surge in demand driven by an increase in consumption of bakery products worldwide.
With this market evolution, there is a notable shift towards plant-based and vegan alternatives, reflecting changing consumer preferences.
However, the industry faces challenges as health concerns associated with traditional shortenings come to the forefront.
This landscape presents both opportunities and obstacles for manufacturers and retailers in the baked goods sector, as they navigate the delicate balance between consumer demand and health considerations.
The rise of plant-based and vegan shortenings
The increase of plant-based and vegan shortenings is changing the global food industry, driven by consumers' increasing preference for healthier, more sustainable options.
Major players like Cargill, the American global food corporation, and Bunge Limited, the agribusiness and food company, are spearheading this transformation, developing innovative shortenings derived from palm, sunflower and soybeans.
These companies are not only responding to consumer demands but also addressing health concerns associated with traditional shortenings.
The new generation of plant-based shortening offers lower saturated fat content and zero cholesterol, aligning with growing health consciousness among consumers and this shift is expected to significantly impact the expansion of the global shortening market in the coming years.
Health concerns and product innovation
However, the industry faces challenges, particularly regarding the high trans fat and saturated fat content in traditional shortenings. To overcome these hurdles, manufacturers are developing improvised formulations with dietary fibres and fortified shortenings.
The focus is on creating healthier alternatives that maintain the desired functional properties for various baked goods. Leading the industry to explore innovation surrounding the use of only essential oils, micronutrients, and fortified shortenings for healthier products.
These advancements aim to address health concerns while preserving the plasticity and consistency necessary for baking applications.
Companies like Fuji Oil, the construction of oils and fats processing plant and Wilmar International, Asia's leading agribusiness group, directing the charge in developing healthier alternatives.
Large corporations and smaller, specialised companies alike are investing in research and development to create shortenings with improved nutritional profiles and these innovations include low-trans fat and reduced saturated fat options, clean-label shortenings, and organic and non-GMO products.
Manufacturers are focusing on creating healthier alternatives that maintain the desired functional properties for various baked goods and formulations. Premiumisation and organic, clean-label (meaning products that only contain natural, synthetic-free ingredients), are on the rise, catering to the growing demand for premium, health-conscious products.
These innovations aim to address health concerns, while still providing the plasticity and consistency necessary for various baking applications, ensuring that consumers can enjoy their favourite baked goods without compromising on health or taste.
Global market dynamics and future prospects
Whilst North America and Europe currently dominate the shortening market, the Asia-Pacific region is rapidly emerging as a key growth area.
This evolution is primarily driven by changing lifestyles, rising disposable incomes and an increasing demand for convenience foods across these regions.
Industry leaders such as Grupo Bimbo, the Mexican multinational food company, are capitalising by expanding their global presence. These companies are reformulating their products to incorporate healthier shortenings, as well as adapting to regional preferences, as the industry responds to consumer demands.
However, the market fragmentation presents a complex scenario, offering both challenges and opportunities for innovation.
Established brands face stiff competition from independent and private-label bakers, whilst new avenues for expansion are opening up in the food-service sector and deep-frying applications.
However, manufacturers are contending with significant production and storage challenges. Temperature considerations and shelf-life concerns remain critical factors in product development and distribution. These technical hurdles necessitate ongoing innovation and investment in research and development.
Furthermore, the rise of e-commerce is fundamentally altering distribution strategies. Companies are swiftly adapting their approaches, developing omnichannel strategies to reach consumers through multiple platforms, from traditional retail outlets to online marketplaces.
Despite these multifaceted challenges, the growth trajectory of the global shortening market remains robust. As the industry continues to innovate and adapt to changing consumer preferences and technological advancements, companies like Cargill may be positioned for sustained expansion in the coming years.
Brian Sikes, President and CEO of Cargill, says: “Working together, as One Cargill, we can build on our company’s many strengths, position ourselves and our customers for growth, and drive even greater global impact in the years to come.”
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