Palm kernel or babassu oil and fractions market in South-eastern Asia

Earlier Report Observations

The market volume for palm kernel and babassu oil in Southeast Asia expanded from 4 699 thousand tons in 2018 to 4 805 thousand tons in 2020. This initial growth was supported by rising regional demand, driven by palm oil's functional properties as a trans-fat substitute and its lower production cost compared to alternatives like soybean oil, which increased its use in cooking and food manufacturing.

Growth accelerated from 2021 onward, with the market reaching 5 520 thousand tons by 2023. A primary driver was Indonesia's policy to increase the mandatory biodiesel blend to B40, which significantly boosted domestic palm oil consumption. This period also saw substantial investments and the launch of new refinery facilities in Malaysia and Indonesia, enhancing production capacity and efficiency to meet rising demand.

Production palm kernel or babassu oil and fractions in South-eastern Asia

In kind, 2017-2020, K t

Top producers of palm kernel or babassu oil and fractions, 2017-2020

World map of production of palm kernel or babassu oil and fractions, 2017-2020

Southeast Asia's production of palm kernel or babassu oil and fractions saw a two-year period of growth before declining. In 2020, the region produced 6,928 K t, marking a moderate decrease of 3.7% compared to the previous year. Looking at the broader period from 2017 to 2020, production increased by 7.8%, which translates to an average annual growth rate of 2.5%. The highest production level was recorded in 2019 at 7,196 K t, with the largest year-on-year increase occurring in 2018 at 8.0%.

Annual dynamics of production in South-eastern Asia in kind, 2017-2020, K t

Exports palm kernel or babassu oil and fractions from South-eastern Asia

Exports in kind, K t

In 2020, Southeast Asia exported 2,433 K t of palm kernel or babassu oil and fractions, showing no change from the previous year. The lowest export volume was in 2018 at 2,388 K t, while the peak was in 2019 at 2,437 K t. The most significant decline occurred in 2018 with a drop of 1.9%, and the largest increase was in 2019 at 2.1%.

Annual dynamics of product's exports from South-eastern Asia in kind, 2017-2020, K t

From 2017 to 2020, the main destinations for Southeast Asia's exports in kind were China, accounting for 28.5% of exports, the Netherlands at 16.6%, and the United States at 10.8%. Together, these three countries represented 56.0% of total export flows.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from South-eastern Asia in kind, 2017-2020

Exports in value, M $ US

After two consecutive years of decline, Southeast Asia's exports of palm kernel or babassu oil and fractions in value terms rebounded. In 2020, exports totaled 2,084 M $ US, reflecting a substantial increase of 20.9% compared to the previous year. Over the period from 2017 to 2020, however, exports decreased by 34.9%, averaging an annual decline of 13.3%. The lowest value was recorded in 2019 at 1,723 M $ US, which also saw the largest drop of 30.3%.

Annual dynamics of product's exports from South-eastern Asia in value, 2017-2020, M $ US

Throughout 2017 to 2020, China, the Netherlands, and the United States remained the key partners for Southeast Asia's exports in value terms. China accounted for 26.8% of exports, the Netherlands for 16.9%, and the United States for 11.8%. Collectively, these three markets made up 55.5% of total export flows.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from South-eastern Asia in value, 2017-2020

Imports palm kernel or babassu oil and fractions to South-eastern Asia

Imports in kind, K t

The data shows irregular fluctuations, pointing to a volatile market environment. Imports reached their lowest point in 2019 at 44 K t and peaked in 2020 at 310 K t, representing a 7.1-fold difference between these years. In 2020, Southeast Asia's imports of palm kernel or babassu oil and fractions amounted to 310 K t, a dramatic increase of 607.8% compared to 2019. The most significant decline occurred in 2019 with a drop of 70.1%.

Annual dynamics of product's imports to South-eastern Asia in kind, 2017-2020, K t

From 2017 to 2020, Papua New Guinea consistently held the top position as the leading source for Southeast Asia's imports in kind of palm kernel or babassu oil and fractions, accounting for 0.9% of total import flows.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to South-eastern Asia in kind, 2017-2020

Imports in value, M $ US

Following a two-year decline, Southeast Asia's imports of palm kernel or babassu oil and fractions in value terms increased. In 2020, imports amounted to 301 M $ US, showing a rise of 36.6% compared to 2019. Over the 2017-2020 period, imports decreased by 34.5%, with a compound annual growth rate of -13.2%. The lowest value was in 2019 at 220 M $ US, which also experienced the largest decline of 46.6%.

Annual dynamics of product's imports to South-eastern Asia in value, 2017-2020, M $ US

Between 2017 and 2020, Papua New Guinea was the primary market for Southeast Asia's imports in value terms, representing 0.9% of total import flows.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to South-eastern Asia in value, 2017-2020