Sustainable Palm Oil Market Size was valued at USD 0.9 Billion in 2022. The sustainable palm oil market industry is projected to grow from USD 0.95 Billion in 2023 to USD 1.359 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 4.50% during the forecast period (2024 - 2032). The sustainable palm oil market is predicted to grow due to market drivers such as rising demand for palm oil in a variety of industries, including food & beverage, cosmetics and personal care, restaurants, and even at home.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
One factor driving the growth of the sustainable palm oil market CAGR is an increase in consumer consciousness, which is ignited by environmental and social issues associated with traditional palm oil production. Nowadays, people are more enlightened about making products that are not sourced from palm oil plants because of the negative impacts related to deforestation, loss of wildlife habitat, extinction of plant and animal species, and human rights abuses resulting from palm oil cultivation. Also, consumers pay close attention to product labeling and certification, showing whether or not responsible production has been achieved in relation to the environment as well as society through sustainable sourcing for palm oil. Consequently, many companies have adopted sustainability based on their policies and obtained certifications from institutions such as Roundtable on Sustainable Palm Oil (RSPO) or engaged suppliers who have been approved for having sustainable practices. This is why businesses in sectors like the food, cosmetics, and personal care industries that are heavily reliant on palm oil are paying more attention to sustainability in their procurement practices due to changing consumer choices and protecting their brand names. As a result, the market is growing with this increasing demand for sustainable palm oil, leading manufacturers to adopt eco-friendly and socially responsible methods, thus promoting growth in the sustainable palm oil industry.
The effects of consumer choices on the environment and society are coming into greater focus. There is a growing market for items made with palm oil that is supplied sustainably; thus, companies that can supply this requirement will have an advantage over their competitors. Furthermore, uses for sustainable palm oil extend beyond the food industry. It finds application in diverse fields, such as cosmetics and biofuels. By examining these markets, new business opportunities may present themselves. Companies can choose to engage in producer and consumer education initiatives. Promoting the use of sustainable palm oil and raising awareness of its advantages could result from this. Moreover, Research & development spending to create more sustainable palm oil variants or substitutes for palm oil in products can be quite profitable. Thus, driving the sustainable palm oil market revenue.
The sustainable palm oil market segmentation, based on type, includes Palm Kernel Oil, Red Palm Oil, White Palm Oil, and Fractional Palm Oil. The Fractional Palm Oil segment dominated the market. The fractional palm oil is available at an affordable price and easy accessibility. Since it is readily available and reasonably priced for the general public, low-income countries really appreciate its popularity. The product's constituent composition allows for increased manufacturing abundance.
The sustainable palm oil market segmentation, based on distribution channel, includes Online and Offline. The offline category generated the most income. The rise of consumer consciousness, together with the search for environmentally sustainable products, has resulted in this. Offline channels such as supermarkets, specialized outlets, or organic markets provide direct contact to customers who are interested in sustainable solutions and provide them with opportunities to participate while learning.
Figure 1: Sustainable Palm Oil Market, by Distribution Channel, 2023 & 2032 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
The sustainable palm oil market segmentation, based on end-use, includes Food, Soap and Detergents, Cosmetics, Bakery Products, Confectionery Products, Margarine, Ice Cream, and Pet Food. The food segment dominated the market. Food products have a substantial market share because of the industry's growing use of it for end products and the rise in product portfolios that call for palm oil as a raw component. Moreover, the growing food category's growth is influenced by population growth, which has also increased demand for products on the market worldwide.
By region, the study provides the market insights into North America, Europe, Asia-Pacific and the Rest of the World. The North American sustainable palm oil market area will dominate this market because sustainable palm oil is quickly becoming popular in many businesses and because the people in the region are becoming more conscious of inexpensive oils. Additionally, the introduction of new rivals is expected to accelerate the growth of the local sector.
Further, the major countries studied in the market report are the US, Canada, Germany, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.
Figure 2: SUSTAINABLE PALM OIL MARKET SHARE BY REGION 2023 & 2032 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Europe sustainable palm oil market accounts for the second-largest market share as a result of growing customer demand for ethically and sustainably produced palm oil. The European Union's 2020 target of using entirely sustainable palm oil is likely to drive up demand for certified sustainable palm oil. Additionally, the rising demand for processed goods and snacks in the food industry is a major factor driving the need for sustainable palm oil in Europe. Further, the German sustainable palm oil market held the largest market share, and the UK sustainable palm oil market was the fastest growing market in the European region.
The Asia-Pacific Sustainable Palm Oil Market is expected to grow at the fastest CAGR from 2024 to 2032. This is attributed to both increased consumption and population expansion because of the region's expanding population and growing demand from end-use businesses like the food and beverage industries. The fast population increase, erratic demographic trends, and varied food consumption of the countries in the region are the reasons behind the high consumption of palm oil. Moreover, China's sustainable palm oil market held the largest market share, and the Indian sustainable palm oil market was the fastest growing market in the Asia-Pacific region.
Leading market players are investing heavily in research and development in order to expand their product lines, which will help the sustainable palm oil market grow even more. Market participants are also undertaking a variety of strategic activities to expand their footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, sustainable palm oil industry must offer cost-effective items.
Manufacturing locally to minimize operational costs is one of the key business tactics used by manufacturers in the sustainable palm oil industry to benefit clients and increase the market sector. In recent years, the sustainable palm oil industry has offered some of the most significant advantages to medicine. Major players in the sustainable palm oil market are attempting to increase market demand by investing in research and development operations, including Golden Agri Resources Limited, Hap Seng Plantation Holdings Berhad, SIPEF group Belgium, Kuala Lumpur Kepong, IOI Corporation Berhad, Sime Darby Plantation Sendirian Berhad, New Britain palm oil limited, Wilmer International Limited, Cargill, and Kulim Berhad.
Agribusiness and palm oil plantation enterprise Golden Agri-Resources Ltd (GAR), a Flambo International Ltd subsidiary, manufactures a variety of palm-based products. The company uses fresh fruit bunches to make palm kernel (PK) oil and crude palm oil (CPO). In addition to producing a variety of goods, such as cooking oils, margarine, shortening, products derived from soybeans, biodiesel, and specialty fat products, it refines CPO. In addition, GAR manufactures sunflower oil, sugar-based products, fatty acids, glycerine, oleochemicals, noodles, snack food, and palm product merchandise.
Wilmar is a processor of agricultural goods, owned by Wilmar International Ltd. Oil palm plantation, edible oil refining, oilseed crushing, sugar milling and refining, oleochemical production, biodiesel production, specialized fat manufacture, fertilizer manufacturing, and flour and rice milling are among the company's business operations. Its operations encompass the whole value chain of the commodities processing industry, including the production and sale of consumable food items, medium and bulk packaging, industrial agri-products, animal feeds, and branding, merchandising, and distribution.
Sustainable Palm Oil Industry Developments
October 2023: Planet Palm is a new line of RSPO-certified sustainable palm oil products designed specifically for UK bakery and food makers, offered by KTC Edibles Ltd (KTC), the leading edible oil supplier in the UK. Planet Palm Oil is among the first products available; specialty products with a focus on sustainability and traceability include Planet Palm Cake Margarine, Pastry Margarine, and Shortening. By promoting sustainable practices, the launch seeks to dispel myths about palm oil.
October 2022: Thailand Sustainable Palm Oil Alliance (TSPOA) was introduced by the Roundtable on Sustainable Palm Oil (RSPO) and the Thailand Environment Institute (TEI) to encourage cooperation amongst palm oil sector participants in Thailand. Through the cooperation, ethical palm oil production will be encouraged countrywide and sustainable practices will be advanced. International sustainability standards are crucial, according to RSPO CEO Joseph D'Cruz.
| Report Attribute/Metric | Details |
| Market Size 2022 | USD 0.9 Billion |
| Market Size 2023 | USD 0.95 Billion |
| Market Size 2032 | USD 1.359 Billion |
| Compound Annual Growth Rate (CAGR) | 4.50% (2024-2032) |
| Base Year | 2023 |
| Market Forecast Period | 2024-2032 |
| Historical Data | 2019-2022 |
| Market Forecast Units | Value (USD Billion) |
| Report Coverage | Revenue Forecast, Market Competitive Landscape, Growth Factors, and Trends |
| Segments Covered | Type, Distribution Channel, End-use, and Region |
| Geographies Covered | North America, Europe, Asia Pacific, and the Rest of the World |
| Countries Covered | The US, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil |
| Key Companies Profiled | Golden Agri Resources Limited, Hap Seng Plantation Holdings Berhad, SIPEF group Belgium, Kuala Lumpur Kepong, IOI Corporation Berhad, Sime Darby Plantation Sendirian Berhad, New Britain Palm Oil Limited, Wilmer International Limited, Cargill, and Kulim Berhad. |
| Key Market Opportunities | Growing consumer spending on natural or eco-friendly items, including sustainable palm oil |
| Key Market Dynamics | Increasing number of individuals are experiencing cardiovascular disease Rising use of sustainable palm oil in the manufacturing of necessities like ice cream, soaps, cosmetics, detergents, and other items |
Frequently Asked Questions (FAQ) :
The sustainable palm oil market size was valued at USD 0.95 Billion in 2023.
The market is projected to grow at a CAGR of 4.50% during the forecast period, 2024-2032.
North America had the largest share in the market
The key players in the market are Golden Agri Resources Limited, Hap Seng Plantation Holdings Berhad, SIPEF Group Belgium, Kuala Lumpur Kepong, IOI Corporation Berhad, Sime Darby Plantation Sendirian Berhad, New Britain Palm Oil Limited, Wilmer International Limited, Cargill, and Kulim Berhad.
The Fractional Palm Oil category dominated the market in 2023.
The food category had the largest share in the market.
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