Coconut, palm kernel or babassu oil and fractions market in Indonesia

Earlier Report Observations

From 2018 to 2019, the market volume for coconut, palm kernel or babassu oil and fractions increased from 2.9 million tons to 3.0 million tons. This growth coincided with the mandatory ISPO sustainability certification for palm oil plantations and the introduction of the compulsory Indonesian National Standard (SNI) for palm cooking oil in 2019, which aimed to improve product quality. In 2020, the market contracted to 2.8 million tons, a period that also saw the enforcement of regulations requiring palm oil to be sold in packaged form and the Domestic Market Obligation policy to prioritize domestic supply.

A significant market expansion occurred in 2021, with volume reaching 3.3 million tons. This surge was directly driven by the government's imposition of ceiling retail prices (HET) and the launch of subsidy schemes for palm oil, making it more affordable and stimulating consumption. The upward trend continued into 2022, with the market growing to 3.5 million tons, supported by the Minyak Goreng Curah Rakyat (MGCR) program and the subsequent removal of the HET policy, which helped alleviate previous supply shortages. By 2023, the market stabilized at 3.5 million tons, reflecting reported stagnation in palm oil production and concurrent government efforts to promote downstream processing within the industry.

Regulatory measures further shaped the market landscape in 2024 and 2025. Key developments included the launch of the branded MINYAKITA packaged palm oil initiative, reinforced distribution roles for state-owned enterprises like Perum Bulog, and the expansion of the national biodiesel mandate to B40, which significantly increases domestic palm oil consumption for fuel production.

Production coconut, palm kernel or babassu oil and fractions in Indonesia

In kind, 2018-2021, K t

Indonesia was one of the world's top producers of coconut, palm kernel, or babassu oil and fractions from 2018 to 2021, ranking first globally by production volume.

Top producers of coconut, palm kernel or babassu oil and fractions, 2018-2021

World map of production of coconut, palm kernel or babassu oil and fractions, 2018-2021

In 2021, Indonesia produced 5 272 K t of coconut, palm kernel, or babassu oil and fractions, representing a 4.4% increase compared to the previous year. Production reached its lowest point in 2020 at 5 048 K t, while the peak was recorded in 2019 at 5 473 K t. The most significant decline occurred in 2020, with a drop of 7.8%.

Annual dynamics of production in Indonesia in kind, 2018-2021, K t

Exports coconut, palm kernel or babassu oil and fractions from Indonesia

Exports in kind, K t

Indonesia's exports of coconut, palm kernel, or babassu oil and fractions declined for the second year in a row. In 2021, exports amounted to 2 030 K t, marking a 10.8% decrease from 2020. Over the period from 2018 to 2021, exports fell by 17.1%, which translates to an annualized decline of 6.1%. The highest export volume was in 2019 at 2 548 K t, with the largest increase that year at 4.1%.

Annual dynamics of product's exports from Indonesia in kind, 2018-2021, K t

From 2018 to 2021, China, the United States, and Malaysia were the primary destinations for Indonesia's exports of coconut, palm kernel, or babassu oil and fractions in volume terms. Together, they accounted for 56.0% of total exports, with China leading at 29.1%, followed by the United States at 13.8%, and Malaysia at 13.1%.

Structure of product's exports in kind by countries, 2018-2021

World map of product's exports from Indonesia in kind, 2018-2021

Exports in value, M $ US

Indonesia's exports of coconut, palm kernel, or babassu oil and fractions in value terms increased for the second consecutive year. In 2021, exports reached 2 885 M $ US, a 54.0% rise compared to 2020. Between 2018 and 2021, exports grew by 19%, with a compound annual growth rate of 6.0%. The lowest value was recorded in 2019 at 1 712 M $ US, which saw the largest decline of 29.4%.

Annual dynamics of product's exports from Indonesia in value, 2018-2021, M $ US

During 2018–2021, China, the United States, and Malaysia were the main markets for Indonesia's exports of coconut, palm kernel, or babassu oil and fractions in value terms. Collectively, they made up 55.1% of total export value, with China contributing 27.4%, the United States 15.3%, and Malaysia 12.5%.

Structure of product's exports in value by countries, 2018-2021

World map of product's exports from Indonesia in value, 2018-2021

Imports coconut, palm kernel or babassu oil and fractions to Indonesia

Imports in kind, K t

Indonesia's imports of coconut, palm kernel, or babassu oil and fractions increased for the third year in a row. In 2021, imports totaled 70 K t, up by 67.0% from the previous year. From 2018 to 2021, imports surged by 387.3%, with a compound annual growth rate of 69.5%.

Annual dynamics of product's imports to Indonesia in kind, 2018-2021, K t

From 2018 to 2021, the Philippines was the dominant source for Indonesia's imports of coconut, palm kernel, or babassu oil and fractions in volume terms, holding an 84.6% share of total imports. The remaining volume was distributed among various other countries.

Structure of product's imports in kind by countries, 2018-2021

World map of product's imports to Indonesia in kind, 2018-2021

Imports in value, M $ US

Indonesia's imports of coconut, palm kernel, or babassu oil and fractions in value terms rose for the third consecutive year. In 2021, imports were approximately 107 M $ US, showing a dramatic increase of 153.1% compared to 2020. Between 2018 and 2021, imports grew by 531.2%, with an annualized rate of 84.8%.

Annual dynamics of product's imports to Indonesia in value, 2018-2021, M $ US

During 2018–2021, the Philippines remained the key source for Indonesia's imports of coconut, palm kernel, or babassu oil and fractions in value terms, accounting for 87.3% of total imports. Other destinations played a much smaller role in the import structure.

Structure of product's imports in value by countries, 2018-2021

World map of product's imports to Indonesia in value, 2018-2021