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U.S. manufacturers sales of fats and oils totaled $8.8 billion in 2003, up 16.3% despite a 1.5% decline in volume consumption. The rise in manufacturers sales can be attributed largely to higher average prices in many market segments compared to the prior year. Until prices stabilize, this trend is expected to continue, with declining consumption and increasing value anticipated through 2005. In 2006, Business Trend Analysts estimates that both volume consumption and the value of sales should rise, although lower prices should translate into a slower rate of growth in value. For the period from 2003 to 2013, Business Trend Analysts projects that U.S. manufacturers sales of fats and oils will rise at an average annual rate of 1.5% to reach $10.2 billion at the close of the period. In the coming years, it is expected that sales and consumption of vegetable oils will be affected by factors such as the increased use of biotech crops, the U.S. governments new labeling
regulations, and research into food production alternatives. Factors such as changes in supply and the popularity of the Atkins and South Beach diets will impact the market for animal fats and oils. It is anticipated that the effects of shifts in end-use
The 2005/2006 Market Outlook for Fats and Oils c Business Trend Analysts, Inc., 2005 demand and fluctuations in pricing will be apparent in both of these segments. All of these issues are discussed in further detail later in this report.
Vegetable oils account for the majority of sales in this industry; they represented an estimated 57.5% of the total value in 2004. This market share will not fluctuate significantly, as similar growth rates are anticipated in the vegetable and animal fats and oils segments from 2003 to 2013. In 2013, it is projected that sales of vegetable oils will reach $5.8 billion, or 56.7% of the industry total, compared to 56.6% at the beginning of that period. The volume consumption picture is slightly different. In 2003, volume consumption of both vegetable and animal fats and oils declined. In that year, vegetable oils accounted for 85.8% of total consumption. Through 2005, however, it is expected that volume consumption of vegetable oils will continue to decline while consumption of animal fats and oils will post its largest gains since 1999. Positive growth is anticipated in both categories in 2006. By that time, however, it is estimated that vegetable oils volume share of the market
will have dipped to 84.7%. | 
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