American Industry Overview: Shortening, Table Oils, Margarine and Other Edible Fats and Oils
Many of the goods classified in this industry are long-time staples of the American kitchen, including shortening, butter, and margarine. U.S. sales of butter, margarine, and table spreads totaled $5.2 billion in 2007. Although this figure represented an increase from the early years of the decade, when the market was estimated at $4 billion, the main reason for the increase was rising dairy prices, not increased consumer usage. Despite numerous challenges for this segment of the industry, 80 percent of Americans still used the products in the late 2000s and total sales were expected to increaseincrease by nearly $1.2 billion through 2012.
Margarine, a key product in this industry, was invented in France in 1869. Market share in the United States was initially impeded by quality concerns, then by the efforts of a powerful butter lobby. After technical improvements and fairer tax legislation, margarine gained greater acceptance and came to be largely regarded as a healthier and cheaper alternative to butter. By the mid-1990s, however, the $1.5 billion margarine industry began to falter, while butter increased its market share. Many consumers who had switched from butter to margarine as a healthier alternative became disillusioned after learning that vegetable shortenings raise the risk of cardiovascular disease. Of particular concern to many health practitioners was the presence of trans fatty acids (TFAs) in margarine. The U.S. Food and Drug Administration mandated the labeling of all products containing TFAs as of January 2006. When the mandate took effect, it applied only to retail products, not foodservice. However, consumer awareness of trans fats led some restaurants to stop using products containing TFAs, and some communities, including New York City, passed ordinances banning those products from use in restaurants.