Palm Oil Market Currently Growing at a CAGR of 4.3 percent, says Beroe Inc

04 September, 2019

Palm Oil Market Currently Growing at a CAGR of 4.3 percent, says Beroe Inc
PR Newswire

RALEIGH, North Carolina, September 4, 2019 - The global supply and consumption for palm oil is currently estimated to be 69.72 MMT and 65.04 MMT respectively, according to Beroe Inc., a procurement intelligence firm. The supply for palm oil is expected to increase by 4 percent compared to past years due to an expected increase in palm production.

Indonesia and Malaysia are the largest palm oil exporting countries holding almost 91 percent of global exports, while India is the largest palm oil importing country. The world’s consumption is expected to increase by 3.9 MMT to reach 68.4 MMT mainly due to an increase in demand from Indonesia, EU, China, and India.

https://www.beroeinc.com/category-intelligence/palm-oil-market

Beroe, which is based in North Carolina, further stated that procurement experts can access this report on its recently launched market intelligence platform Beroe LiVE: live.beroeinc.com

An innovation in the palm oil industry is the production of palm-based mayonnaise. Soft oils such as palm oil are commonly used as salad oil in mayonnaise production. Palm olein, the liquid fraction of palm oil can be fractionated into oils with different iodine values. The normal palm olein (IV 56-58) is used for frying and is not suitable for mayonnaise or salad dressing as the end-product hardens during storage at refrigeration temperature. Higher IV (60-67) palm oleins are suitable both as a salad oil or for making salad dressing.

Based on Porter’s Five Forces analysis, the palm oil suppliers have high power to influence the prices as they are large integrated players such as KLK, IOI, etc. There is no product differentiation and the industry operates on economies of scale, the barriers to new participants, and the intensity of a rivalry is medium to high.

Key Findings:

  • Malaysia and Indonesia are the major soybean producing areas and together export nearly 91 percent of the global palm oil. In the coming years, Indonesia is expected to surpass US and Brazil in biodiesel production; hence, its consumption rates are expected to increase.
  • Palm oil is the most widely consumed vegetable oil in the world. India is the major palm oil consuming country with its main end-use application being for food use.
  • The emerging sourcing destinations for palm oil are Thailand and Colombia. In the past five years, production in Thailand and Colombia have increased at a CAGR of 2 percent and 7 percent, respectively.
  • In Malaysia, palm oil prices and contract structures are fixed by Malaysian suppliers using MPOB (Malaysian Palm Oil Board) three-month futures prices and adding the freight costs. The profit margin depends on the time of buying and selling of the raw material.
  • Palm oil can be easily substituted by soybean oil and other vegetable oils.

The research methodology adopted for the report included:

  • Experts with twenty years of domain experience
  • Interaction with buyers
  • Inputs from supply chain partners

The Indonesian palm oil prices are expected to decrease by almost 4.5 percent by the end of 2019. High export demand with the revival in the palm supplies due to expected El-Nino conditions is expected to be the key price driver in the palm oil industry. However, the Malaysian crude palm oil prices are at an increasing trend even during the harvest months due to the affordable palm oil stocks.

The report also includes:

Market Analysis:

  • Value Chain Analysis
  • Global Market Outlook -
  • Current Market Size
  • Demand - Supply Trends and Forecast
  • Key End-use Industries
  • Trade Dynamics
  • Regional Market Outlook (Indonesia, Malaysia)
  • Current Market Size
  • Demand - Supply Trends and Forecast
  • Key End-Use Industries
  • Trade Dynamics
  • Palm Oil Derivatives (Global, Indonesia, and Malaysia)

Industry Analysis:

  • Industry Outlook
  • Drivers and Constraints for the Industry
  • Innovations
  • Porter’s Five Forces Analysis

Supplier Analysis:

  • Profiling of Major Suppliers
  • Wilmar International Ltd.
  • Cargill Inc.
  • Bunge Limited
  • KLK Berhad
  • IOI Corporation Bhd

Cost & Price Analysis:

  • Price Analysis (Indonesia and Malaysia)
  • Price Forecast for Palm Oil
  • Price Forecast for RBD Palm Olein & RBD Palm Stearin

About Beroe Inc.:

Beroe is the world's leading provider of procurement intelligence and supplier compliance solutions. We provide critical market information and analysis that enables companies to make smart sourcing decisions—leading to lower costs, greater profits and reduced risk. Beroe has been providing these services for more than 13 years and currently works with more than 10,000 companies worldwide, including 400 of the Fortune 500 companies.

To learn more about Beroe Inc., please visit: http://www.beroeinc.com

Media Contact:
Debobrata Hembram

debobrata.hembram@beroe-inc.com