Palm Derivatives
29 March 2019
Palm products, particularly palm oil and its derivatives, play a crucial role in global trade, especially within the B2B commodities sector. With increasing demand across various industries, from food to fuel, understanding the fundamentals and emerging trends of palm products is essential for informed decision-making. Whether you're sourcing raw materials or exploring new market opportunities, here are the key facts about palm products that you should know in 2025.
The global palm oil industry is expected to see steady growth in 2025, driven by strong demand in Asia-Pacific and Africa. According to the USDA, world production of palm oil reached 79 million metric tons in 2024 and is forecast to exceed 80 million tons in 2025. Indonesia and Malaysia remain the top producers, accounting for nearly 85% of global supply.
Major importing countries include India, China, the European Union, and Pakistan. Price trends suggest moderate increases due to tight supply from weather disruptions and increased demand for biodiesel blending mandates in Southeast Asia.
Derived from the kernel of the palm fruit, PKO is widely used in cosmetics, soaps, and confectioneries. It has a high lauric acid content, making it ideal for surfactants and cleaning agents.
A by-product of the refining process, PFAD is used in biodiesel production, animal feed, and laundry soap.
These are refined, bleached, and deodorized oils separated into liquid (olein) and solid (stearin) forms. Olein is mainly used in cooking oil, while stearin is utilized in bakery fats and industrial frying.
A derivative of palm oil used in pharmaceuticals, cosmetics, and personal care products.
Palm oil remains the most efficient oil crop, yielding 3.5 – 4 tons per hectare compared to 0.7 for soybean. This high productivity explains why it's used in over 50% of supermarket products, including snacks, detergents, and candles.
Key industries:
FMCG: Palm derivatives in processed food and personal care
Pharmaceutical: Glycerin and fatty alcohols
Bioenergy: PFAD and palm oil methyl esters
Logistics-wise, Southeast Asia supplies large volumes via Singapore and Malaysian ports, often headed to major refineries in India, China, and Europe.
Sustainability is now a market requirement. RSPO (Roundtable on Sustainable Palm Oil) and ISPO certifications are now standard expectations among buyers.
Top facts:
Over 19% of global palm oil production is RSPO-certified.
Companies like Nestlé, Unilever, and Procter & Gamble have committed to 100% traceable palm oil sourcing.
New tech, such as satellite tracking and blockchain, is being used to verify sourcing data and prevent deforestation.
Despite historical environmental concerns, palm oil’s high yield actually reduces the need for land expansion compared to other oil crops.
Palm biomass (leaves, shells, fibers) is used to produce bioenergy, fertilizer, and even construction materials.
Palm oil contributes significantly to rural economies in Indonesia and Malaysia, supporting millions of smallholders.
Palm-based oleochemicals are replacing petrochemicals in green chemistry, enabling a more sustainable chemical industry.
Palm products are more than just a commodity; they're a cornerstone of global manufacturing, food, and energy. In 2025 and beyond, understanding the complex world of palm derivatives, sustainability commitments, and market dynamics will be critical for B2B buyers.
Stay informed, source responsibly, and engage with suppliers like Tradeasia who prioritize both quality and sustainability.
United States Department of Agriculture. (2025). Oilseeds: World Markets and Trade. https://ipad.fas.usda.gov/cropexplorer/cropview/commodityView.aspx?cropid=4243000&sel_year=2025&rankby=Production
Zion Market Research. (2024). Palm Kernel Oil Market By Applications (Edible Oil, Cosmetics, Biodiesel, Lubricants, Surfactants And Others): Global Industry Perspective, Comprehensive Analysis And Forecast, 2024–2032. https://www.zionmarketresearch.com/report/palm-kernel-oil-market
PW Consulting. (2024). Worldwide RBD (Refined, Bleached and Deodorised) Palm Olein Market Research Report 2025, Forecast to 2031. https://pmarketresearch.com/product/worldwide-rbd-refined-bleached-and-deodorised-palm-olein-market-research-2024-by-type-application-participants-and-countries-forecast-to-2030/
Global Growth Insights. (2025). Glycerin Market Size, Share, Growth, and Industry Analysis, By Types (Technical Grade Glycerin, USP Grade Glycerin), Applications (Food and Beverages, Pharmaceutical, Cosmetics, Industrial, Others) and Regional Insights and Forecast to 2033. https://www.globalgrowthinsights.com/market-reports/glycerin-market-115100
See, G. (2025). RSPO's next frontier: Scaling sustainable palm oil in Asia's emerging markets. Eco-Business. https://www.eco-business.com/news/rspos-next-frontier-scaling-sustainable-palm-oil-in-asias-emerging-markets/
Sustainable Palm Oil Choice, More facts - Sustainable Palm Oil Choice. https://www.sustainablepalmoilchoice.eu/more-facts/
World Wildlife Fund. (2023). Palm Oil. https://www.worldwildlife.org/industries/palm-oil
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