The North American bakery industry is one of the largest and most developed food sectors in the world, supported by strong and consistent consumer demand for products such as bread, pastries, cakes, cookies and bakery snacks. Driven by evolving consumer preferences and continuous product innovation, manufacturers continue to expand their product offerings to meet changing market needs. As a result, demand for functional food ingredients, including palm oil and palm-based specialty fats, continues to grow across the region.
The strength of the North American bakery market is reflected in its significant global standing, with the region remaining the second-largest bakery market worldwide. Retail sales reached USD 105.24 billion in 2025, accounting for 20.37% of the global bakery market. As one of the world’s leading bakery consumption and production hubs, North America generates substantial demand for ingredients used in bakery manufacturing, creating opportunities for functional fats and oils.
Growth in the North American bakery market is being driven by strong demand across both staple and indulgent product categories. In the United States, bread remains the largest bakery segment, valued at USD 34.1 billion, supported by its role as an everyday staple and growing consumer interest in whole-grain and high-fibre varieties. Cakes hold a strong market position at USD 30.8 billion, while pastries represent a sizeable market worth USD 24.2 billion. Dessert pies and tarts also continue to attract consumer interest, driven by indulgence trends and increasing demand for convenient, on-the-go snacks.
Palm Oil Relevance
As demand continues to grow across both traditional and industrial bakery segments, opportunities for palm oil and palm-based specialty fats are expected to expand, particularly in shortenings, margarines, fillings and other bakery formulations. These ingredients are widely used to provide texture, stability, volume and extended shelf life in bakery products. Palm oil continues to play an important role in these applications due to its versatility and functional performance. Therefore, the sustained growth of major bakery categories is expected to reinforce the importance of palm-based ingredients throughout the North American bakery value chain.
Malaysia exported 586,203 tonnes of palm oil and palm products to North America in 2025, with more than 80% of the volume shipped to the United States, followed by Mexico at 11.51% and Canada at 8.14%. Among the key products exported, RBD palm olein shipments reached 47,241 tonnes to the United States, 6,955 tonnes to Canada and 681 tonnes to Mexico. RBD palm stearin exports were also significant, with 52,895 tonnes shipped to the United States, 2,201 tonnes to Mexico and 1,093 tonnes to Canada.
Meanwhile, exports of palm-based finished products increased by 0.96% to 33,773 tonnes. Canada imported 4,116 tonnes of finished products, with shortening being the leading product, while Mexico imported 4,253 tonnes, primarily cocoa butter equivalent. The United States alone imported 25,404 tonnes of finished products, representing an increase of 16.36%, with cocoa butter equivalent (30.9%) and vegetable fats (22.17%) accounting for the largest shares.
Increasing Consumer Demand Across the Region
The North American bakery industry is supported by strong consumer demand and a well-developed manufacturing base across the United States, Mexico and Canada. In the United States, nearly 53,000 bakery companies operate nationwide, led by major players such as Grupo Bimbo, Flowers Foods, General Mills, Mondelez International and Kellanova, with Bimbo Bakeries USA as the largest producer. The presence of established brands such as Sara Lee in bread and Entenmann’s in cakes and pastries further reflects the maturity and competitiveness of the United States bakery market. Mexico’s bakery sector is driven by high demand for bread, pan dulce, cakes, pastries, cookies and tortillas, supported by both industrial manufacturers and a large network of traditional bakeries. Industrial bakeries account for a significant share of Mexico’s bakery production, highlighting the importance of large-scale manufacturing alongside artisanal consumption. In Canada, bread remains a staple food, while premium and artisanal bakery products continue to gain popularity among consumers. Canada’s bakery market is also supported by a strong retail and manufacturing base, with bakery establishments concentrated mainly in Ontario, Quebec and British Columbia.
Bakery demand across North America is expected to remain resilient, supported by changing lifestyles, urbanisation and growing demand for convenient food options. As consumers balance busy work schedules, longer commuting times and fast-paced lifestyles, ready-to-eat and on-the-go bakery products such as bread, pastries, muffins, cookies and snack cakes continue to gain popularity. Convenience remains one of the key drivers of packaged food consumption, as consumers seek products that require minimal preparation while still offering taste, affordability and portability. The expansion of e-commerce, food delivery services and convenience retail channels is also improving access to bakery products across the region.
At the same time, the bakery market is becoming more segmented. Middle- and lower-income households are increasingly shifting towards affordable baked goods and smaller pack sizes, while higher-income consumers continue to support demand for unpackaged, artisanal and premium bakery products. The future of bread consumption reflects this divide between value-oriented purchasing and indulgence-driven consumption. In addition, rising demand for healthier and functional bakery products, including whole-grain, high-fibre, gluten-free and clean-label offerings, is encouraging manufacturers to reformulate products and reduce artificial ingredients across their portfolios. These trends are expected to support continued growth in bakery consumption and reinforce demand for ingredients used in bakery manufacturing, including palm-based shortenings, margarines and specialty fats.
Looking Ahead
While Malaysian palm oil already maintains a presence in North America’s food manufacturing sector, the region’s large and evolving bakery industry presents significant opportunities for greater utilisation of palm-based ingredients. As demand grows for packaged baked goods, premium pastries, snack products and convenience-oriented bakery items, manufacturers are expanding their product portfolios and increasingly require functional fats and oils that can deliver product quality, consistency and extended shelf life.
This trend is expected to support continued demand for versatile ingredients used in bakery formulations, including palm oil and palm-based specialty fats. As the North American bakery industry continues to expand and diversify, opportunities for Malaysian palm oil are expected to grow across a broad range of bakery applications, reinforcing its position as a versatile and functional ingredient in modern food manufacturing.
Prepared by:
Nuradibah Razali