Canola Oil Market

Canola Oil Market Outlook (2025 to 2035)

Global canola oil market expected to reach USD 657.8 million by 2035, up from USD 443.2 million in 2024. During the forecast period (2025 to 2035), the industry projected to expand at a CAGR of 3.7%.

Canola oil plays a vital role in the global edible oils market due to its versatility, heart-health benefits, and rising demand for plant-based cooking solutions. With its low saturated fat content and high omega-3 levels, it appeals to health-conscious consumers. The market’s rapid growth reflects shifting dietary preferences and expanding food-processing applications, especially across developing economies and sustainable food systems.

What are the drivers of the Canola Oil Market?

The canola oil market is advancing rapidly, fueled by its integral role in both nutritional and industrial innovation. In addition to its standard application, the use of canola oil in the culinary industry, it is being considered as a desirable base in both the nutraceuticals and functional food item formulations because it contains high proportions of alpha-linolenic acid and tocopherols. The use of these bioactive compounds in cardiovascular health studies as well as antioxidant support is also gaining prominence thus making canola oil a strategic ingredient in the development of foods targeted in the health food sector.

Institutional and foodservice demand is expanding as well, particularly in quick-service restaurants (QSRs) that seek cost-effective, long-lasting frying oils. Canola oil's oxidative stability and low reversion flavor make it particularly suited for high-volume frying, reducing waste and enhancing operational efficiency.

Global dietary shifts toward Mediterranean and flexitarian diets have further drove the penetration of the oil in the market due to the need of the consumers to have healthier fat profiles without compromising the taste and performance. In addition, the rising demand for clean-label products has propelled the use of minimally processed, cold-pressed canola oil, especially in premium retail segments.

From a supply-side perspective, favorable agronomic traits and government-backed incentives for oilseed crop rotation have made canola an economically viable alternative for farmers, enhancing production scalability and stabilizing regional supply networks. This dual role of nutritional superiority and agronomic adaptability continues to drive sustained market growth.

What are the regional trends of the Canola Oil Market?

The dynamics of regional demand of the canola oil market incorporate a mixture of food culture, industry infrastructure, and policy structure. The oil in North America and especially Canada enjoys the advantage of being in close vicinity of the large scale cultivation and the state of the art crushing facilities.

The dynamics of canola oil consumption in Europe are often defined by the dual status of the oil as foodstuff and as raw material of the renewable feedstock. Besides domestic consumption, large quantities are diverted to the second-generation biodiesel manufacture as part of the EU renewable energy directive II (RED II) most notably in Germany and the Netherlands. This regulatory integration of food and fuel markets reinforces demand stability.

Asia-Pacific's ascent is underpinned by structural dietary transitions and the proliferation of modern retail formats. The increasing influx of health stores chains in Chinese, Indian and South East Asian cities has enhanced access of consumers to high-quality edible oils such as canola. Furthermore, Japan and South Korea exhibit sophisticated demand anchored in culinary finesse and high-margin value-add segments such as organic and non-GMO oils.

Meanwhile, Africa’s import-reliant demand is increasingly shaped by geopolitical sourcing strategies. Governments in Nigeria and Kenya are investing in domestic oilseed crushing capacity to reduce dependency on imports, creating long-term opportunities for canola integration. Latin America, though relatively emerging, is recording sustained growth owing to modernization of the food industry in Argentina and Chile.

What are the challenges and restraining factors of the Canola Oil Market?

The canola oil market faces a multifaceted set of constraints that stem from agronomic, regulatory, and geopolitical challenges. Volatility in climatic conditions is one of the most burning challenges today, as precipitation and temperature patterns have grown more irregular, which influences the quality and the volume of canola crops. Being a cool crop, canola is vulnerable to temperature fluctuations and water stress and the market is subjected to constant shortages.

Trade dependencies also complicate the global flow of canola oil. The growing trade tensions especially those associated with giant manufacturers such as Canada and China have brought in conditions of tariff uncertainties and logistic bottlenecks. This may discourage investment in long-term supply contracts making the global market less fluid.

On the regulatory front, the canola oil industry must navigate an increasingly stringent landscape regarding trans fats, processing residues, and traceability. Emerging food safety frameworks, particularly in ASEAN and African markets, are demanding more robust documentation and quality assurance protocols, raising the compliance burden for exporters.

Country-Wise Insights

Countries	CAGR (2025 to 2035)
Canada	3.6%
China	4.5%
India	4.4%

Agronomic Optimization and Industrial Diversification in Canada

The Canadian canola oil industry is experiencing the strategy of change, which is marked by new consideration to improved agronomic practices and end diversification in industry. Producers increasingly use the precision agriculture practices including use of GPS-guided seeding, soil mapping and predictive analytics in effort to optimize the utilization of inputs and to increase yield efficiency.

This technology coordination equates to the enhanced, traceability and sustainability reports; which is vital in fulfilling emerging domestic and international requirements. In line with agronic productivity, policy-driven expansion of the renewable fuel industry is contributing to the rise of the demands of canola-derived feedstocks, which are triggering capital investments in dual-purpose crushing and refining facilities.

The demand of consumers is slowly changing towards clean-label (non-GMO) oils of regional origin, and thus the concept of premium segmentation appears steadily in the domestic market. These dynamics collectively signal a departure from traditional volume-centric export models toward a more integrated, value-driven ecosystem. The sector's forward trajectory is expected to hinge on its ability to balance food-grade innovation with industrial scalability under a regulatory environment focused on climate targets and supply chain transparency.

Health-Centric Positioning and Platform-Led Penetration in China

The canola oil market in China is on the rise owing to structural changes in diet, national health, and the spread of electronic trade. The increasing consumer concern about cardiovascular and nutritional sufficiency is creating a demand of low-saturated-fat cooking mediums of which canola oil is set to emerge as a functional substitute of regular cooking oils. This shift is being strengthened by the modernization of the food processing industry directed by the government, along with the stringent regulations dealing with the quality of edible oil. Manufacturers are countering with value accretive varieties such as cold-out and low residue oils, backed up by purer refining processes.

Digital retail platforms are playing a pivotal role in market penetration, offering curated, health-branded oil portfolios through livestream commerce, influencer channels, and mobile-integrated shopping experiences. Innovations in smart packaging and traceability features are bolstering consumer trust, especially in urban Tier 1 and Tier 2 cities. The development of this market is based on the correlation of three rather different factors, health-related consumption, regulatory assistance, and e-commerce facilitation, since canola oil could be used as an important ingredient in a high-quality edible oil blend in China.

Nutritional Repositioning and Cultural Compatibility in India

India's canola oil segment is progressively gaining relevance within a health-conscious, urbanizing consumer base seeking alternatives aligned with both modern nutrition and traditional culinary practices. While mustard oil continues to dominate in legacy regions, canola oil is being repositioned in metros and wellness-focused demographics as a light, heart-healthy solution suitable for diverse cooking styles.

Its neutral flavor spectrum and saturated fat level make it appealing to the dieting trend which is balance and digestion-focused according to Ayurveda trends. Local manufacturers are launching fortified and cold-pressed blends, many of which are promoted in health stores and specialty shops and via the web and social media.

Transparency of labeling, certifications of origin, and minimal processing are becoming frequent purchase motivators among aspirational purchasers. The convergence of urban lifestyle aspirations, regional food innovation, and nutritional awareness is fostering a niche but expanding space for canola oil. As premiumization gains ground, this segment is expected to scale through differentiated branding and integration into India's evolving food retail landscape.

Category-Wise Analysis

Processing Elevates Shelf Life and Commercial Utility

Refined oil has continued to be the stalwart of mass food production due to the unsurpassed consistency and stability at high temperatures. It boasts of a bland taste and long shelf life, which make it suitable in applications where standardized ingredients and minimal sensory impact are desired. The best trait about this segment according to manufacturers is that it is reliable in the batch processing which is mostly applicable in fried and pre-packaged products. As production volumes scale, processed oil provides operational assurance, reducing variability and product rework.

The segment benefits from improvements in refining technology that increase yield and purity, supporting lower per-unit costs. Foodservice providers and co-packers rely on its performance in high-temperature cooking and long storage cycles. Buyers increasingly value processed oil for its predictable quality and regulatory compliance across labeling standards. Its ability to integrate seamlessly into automated systems adds further value for processors optimizing throughput. With price sensitivity and production uptime as key purchasing factors, processed oil continues to secure high-volume demand across diverse packaged food and foodservice applications.

Virgin Extraction Aligns with Premium Product Positioning

Food processors are showing interest in virgin oil due to its focus on the premiums and health-conscious consumer. Extracted mechanically without chemical solvents, it retains natural antioxidants and essential fatty acids, which appeal to ingredient-conscious buyers. This segment thrives on its ability to support clean-label claims and meet consumer expectations for authenticity and minimal processing.

Virgin oil is a component used by processors in premium snacks, dressing on salads and wellness foods where value creation attributes like transparency and traceability are key influencers. It has a natural nature, which justifies high prices points allowing the brands to differentiate in terms of quality and purity.

With the increasing demand of non-GMO products, allergen-free foods and additive-free foods, virgin oil easily complement reformulated product lines. Manufacturers appreciate its compatibility with emerging sustainability narratives, especially when sourcing from verified, eco-conscious supply chains. The procurement teams are giving it much priority not just because of the nutritional properties but also due to the fact that it increases brand perception. Virgin oil is strategic in a market that has been focusing on realness and value-based consumption.

Pouch Packaging Drives Down Costs and Enhances Mobility

The pouch packing is transforming procurement and distribution channels through the introduction of a lightweight and cost effective alternative to hard textile/ rigid formats. The easy supply, cost-efficient production, and the potential to be easily compressed into a flat, weight diminishing layout that has an enhancing storage articulation is an added reason why manufacturers and bulk buyers are increasingly opting to use a pouch rather than a box to store their goods.

Lean supply chain models are advantageous to this section because pouches can be filled quickly, use cubes and waste can be dealt with easily. High-barrier films maintain oil integrity, reducing spoilage and extending usability in high-turnover environments. Pouches also meet evolving sustainability benchmarks with lower material input and growing recyclability.

Procurement managers see strong value in their lower total landed cost and operational flexibility, especially in private-label and institutional supply contracts. The format supports customization in volume and dispensing design, catering to foodservice, hospitality, and industrial kitchens that value convenience and safety. With growing pressure to streamline packaging costs without compromising product protection, pouch solutions are securing long-term adoption across segments seeking agility and scalability.

Competitive Analysis

Key players in the Canola Oil Market include Adani Wilmar Ltd., Ruchi Soya Industries Ltd., Associated British Foods, Archer Daniels Midland Company, Bunge Limited, Borges Mediterranean Group, Cargill Inc., Fuji Vegetable Oil, Inc., Adams Group, and American Vegetable Oils, Inc.

The market is expanding due to rising demand for heart-healthy, low-saturated-fat cooking oils and growing consumer preference for non-GMO and organic products. Innovations in oil extraction, fortified formulations, and cold-pressed variants are shaping the competitive landscape.

Companies are investing in sustainability through carbon reduction and eco-friendly packaging. Market reach is being extended through vertical integration, strategic alliances and development of regional markets. Leading players focus on clean-label trends, improved traceability, and efficient supply chains to stay competitive in this health-conscious segment.

Recent Development

• In January 2025, Neste and Bayer signed a memorandum to develop a winter canola ecosystem in the U.S. as part of a regenerative agriculture initiative. Winter canola, used as a rotational crop, offers lower-carbon vegetable oil, boosts soil health and biodiversity, and supports feedstocks for renewable diesel and aviation fuels.

Fact.MR has provided detailed information about the price points of key manufacturers of Canola Oil Market positioned across regions, sales growth, production capacity, and speculative technological expansion, in the recently published report.

Methodology and Industry Tracking Approach

Fact.MR’s 2025 report on the global canola oil market is based on detailed insights from 14,800 participants across 42 countries, with a minimum of 400 respondents per country. Of the total respondents, 68% represented direct users or producers, including companies in edible oil production, food processing, commercial catering, and renewable fuel sectors. The other 32% consisted of supply chain experts, compliance officers, sustainability advisors, and market intermediaries.

Survey responses were gathered from June 2024 through May 2025, ensuring full-year market visibility. The data reflects variations in regional consumption, investment activity, innovation focus, and procurement dynamics. Weighting was applied based on local market significance and population indicators.

Over 360 verified secondary sources such as academic publications, regulatory databases, and financial disclosures were analyzed. Fact.MR used predictive modeling and statistical methods to deliver accurate forecasts. Market monitoring has been ongoing since 2018 to support long-term industry evaluation.

Segmentation of Canola Oil Market

• By Product Type :

  • Processed
  • Virgin
  • Refined
  • Cold-Pressed
  • Blended Oils
  • Others

• By End Use :

  • Foodservice
  • Food Processor
  • Retail

• By Packaging Type :

  • Bottles
  • Pouches
  • Cans
  • Tins
  • Drums

• By Distribution Channel :

  • Modern Trade
  • Franchise Outlets
  • Specialty Stores
  • Online

• By Region:

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