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

Earlier Report Observations

The market volume for unmodified coconut, palm kernel, and babassu oils in Malaysia declined from 2 088 thousand tonnes in 2018 to 1 721 thousand tonnes in 2021, with a notable contraction of over 14% in 2020.

A surge in oleochemical demand for cleaning and disinfectant products during the COVID-19 pandemic drove market growth to 1 992 thousand tonnes in 2022, supported by extensive state-backed oil palm plantations. The market then fell to 1 805 thousand tonnes in 2023 as lower palm oil prices boosted export competitiveness and structural issues like heavy reliance on foreign labor constrained production.

In 2024, significant price increases for palm kernel oil occurred due to higher export activity, while stagnant planted area and continued foreign labor dependency limited production expansion. Ongoing structural challenges, including slow replanting of aging trees, are influencing the market into 2025.

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

In kind, 2018-2021, K t

On a global scale, Malaysia ranked as the world's second-largest producer of coconut, palm kernel, or babassu oil and fractions from 2018 to 2021.

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

Malaysia's production of coconut, palm kernel, or babassu oil and fractions declined for the second year in a row. In 2021, the country produced 2 103 K t, which represents a 6.7% decrease compared to 2020. Over the 2018-2021 period, production fell by 10.1%, with an average annual decline of 3.5%. The highest production level was recorded in 2019 at 2 369 K t, which also saw the largest annual increase of 1.3%.

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

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

Exports in kind, K t

Following two years of growth, Malaysia's exports of coconut, palm kernel, or babassu oil and fractions declined in 2021. Exports totaled 962 K t that year, marking a 9.9% year-over-year decrease. Between 2018 and 2021, exports overall increased by 25.6%, translating to an average annual growth rate of 7.9%. The peak export volume was reached in 2020 at 1 067 K t, which also experienced the largest annual increase of 20.7%.

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

From 2018 to 2021, the Netherlands, China, and the United States were the key export partners for Malaysia in terms of volume. The Netherlands accounted for 28.8% of exports, China for 19.2%, and the United States for 9.4%, together making up 57.3% of total export flows.

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

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

Exports in value, M $ US

Malaysia's exports of coconut, palm kernel, or babassu oil and fractions in value terms grew for the second consecutive year. In 2021, exports reached 1 411 M $ US, showing a sharp increase of 54.6% compared to the previous year. Over the 2018-2021 period, export value rose by 72.6%, with an average annual growth rate of 19.9%. The lowest value was recorded in 2019 at 639 M $ US, which also saw the largest annual decline of 21.9%.

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

In the 2018-2021 period, the Netherlands, China, and the United States formed the main cluster of markets for Malaysia's exports in value terms. The Netherlands held a 28.2% share, China 17.5%, and the United States 8.9%, collectively accounting for 54.6% of total export value.

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

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

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

Imports in kind, K t

Malaysia's imports of coconut, palm kernel, or babassu oil and fractions increased for the third consecutive year. In 2021, imports amounted to 1 000 K t, reflecting a 9.1% year-over-year rise. Between 2018 and 2021, imports grew by 12.8%, equivalent to an average annual increase of 4.1%.

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

From 2018 to 2021, Indonesia, Thailand, and the Philippines remained the primary suppliers of coconut, palm kernel, or babassu oil and fractions to Malaysia in volume terms. Indonesia contributed 56.3% of imports, Thailand 22.4%, and the Philippines 12.6%, together accounting for 91.4% of total import volume.

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

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

Imports in value, M $ US

The import market showed significant volatility during these years. Imports reached their lowest point in 2019 at 343 M $ US, which also experienced the largest annual decline of 29.9%. By 2021, imports had surged to 776 M $ US, marking a steep increase of 71.0% compared to the previous year. Overall, from 2019 to 2021, imports changed by a factor of 2.3.

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

In the 2018-2021 period, three main markets—Indonesia, Thailand, and the Philippines—collectively absorbed 89.9% of the total import value of coconut, palm kernel, or babassu oil and fractions into Malaysia.

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

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