China’s demand for vegetable oil for food use is projected to decrease by 4.1% in the 2025/26 marketing year, reaching an estimated 34.7 million tonnes, according to a recent report by the US Department of Agriculture (USDA). This anticipated decline marks a continuation of the downward trend from the previous year, with the latest forecast 1.9% lower than the USDA’s estimate of 35.36 million tonnes for 2024/25. The agency attributes this reduction to a combination of factors including slower economic growth, changing consumer behavior, and demographic shifts.
Economic uncertainty has led to reduced dining out, as reflected in food service revenue figures from China’s National Bureau of Statistics (NBS). In the first half of 2025, food service revenue reached CNY2.75 trillion (US$387 billion), a 4.3% increase year-on-year. However, the growth rate slowed to just 0.9% in June, suggesting weaker momentum in consumer spending on food outside the home. Additionally, tighter government regulations on official dining are expected to impact hotels, restaurants, and institutional sectors, further curbing vegetable oil consumption.
China’s population dynamics are playing a critical role in shaping vegetable oil demand. The country’s population has declined for three consecutive years, according to the Population Report 2024, with a net decrease of 1.39 million people from 2023. While there was a slight rebound in births—about 9.54 million babies were born in 2024, up 5.7% from the previous year—this does not offset broader demographic trends. The population is also aging rapidly: NBS data show that individuals aged 60 and above accounted for 18.7% of the total population in 2020, rising to 22% by 2024.
Older consumers typically eat less vegetable oil, which offsets potential increases from urbanization and growing per capita income. As a result, overall demand is expected to remain subdued despite some positive economic indicators. Nutritionists and public health organizations in China have also urged caution regarding vegetable oil intake due to high per capita consumption rates.
While food use remains the largest category for vegetable oil consumption in China, other segments such as feed and industrial use also factor into overall demand projections. The August China Agriculture Supply and Demand Estimates (CASDE) report forecasts total vegetable oil consumption at about 34.11 million tonnes for 2025/26, down from 34.85 million tonnes the previous year.
Vegetable oil use for animal feed is expected to remain stable at approximately 1.3 million tonnes through both marketing years, while combined feed and other uses are projected at around 2.54 million tonnes—slightly higher than last year’s figure of 2.50 million tonnes. Lower prices for major feed ingredients like soybean meal and corn are likely to limit growth in vegetable oil use for feed purposes. Typically, when wheat and rice replace more expensive corn in feed formulations, vegetable oil inclusion rises to improve calorie content and palatability.
The USDA has also revised its estimates downward for industrial palm oil usage due to reduced imports caused by higher global prices. Slower production growth and increased domestic consumption in Indonesia and Malaysia have contributed to rising palm oil costs worldwide.
China’s imports of vegetable oils are forecasted to decline sharply amid sufficient domestic supply and weakened consumption demand. According to USDA data, imports for the 2024/25 period are estimated at just 6.4 million tonnes—a significant drop from the previous figure of 9.7 million tonnes—driven primarily by reductions in palm oil and sunflowerseed oil purchases.
For the upcoming year, total vegetable oil imports are forecast at around 6 million tonnes as domestic crushing capacity meets most of the country’s needs. The report suggests that overall declines in consumption—including palm oil—may be linked to reduced export demand for used cooking oil (UCO), which previously supported higher import volumes.
In summary, China’s vegetable oil market is undergoing notable changes influenced by economic conditions, health awareness campaigns, demographic trends, and shifts within key industry sectors. These factors are collectively shaping a more subdued outlook for both domestic consumption and import demand through at least the next marketing year.
