July 20, 2024

Soy Oil And Palm Oil Market Is Driven By Growing Edible Oil Consumption Across The Globe

Soybean and palm fruits are major sources of edible oils globally owing to their high oil content and year-round availability. Soy oil and palm oil find wide usage in cooking oils, margarine, shortenings and other food applications due to their neutral taste and higher smoke points. They also serve as economical substitutes for expensive oils such as olive and sunflower oils. Furthermore, soy oil and palm oil derivatives have applications as additives and ingredients in personal care products, biofuels and industrial applications on account of their emollient and lubricating properties.

The global Soy Oil and Palm Oil Market is estimated to be valued at US$ 109724.12 Mn in 2023 and is expected to exhibit a CAGR of 6.2% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:
Sustainability and traceability are emerging as key trends shaping the global soy oil and palm oil market landscape. There is growing consumer preference for sustainably and ethically sourced oils to address environmental and social concerns related to deforestation and exploitation of small farmers. As a result, producers are focusing on implementing sustainable cultivation and sourcing practices including adherence to No Deforestation, No Peat, No Exploitation (NDPE) policies and certification under the Roundtable for Sustainable Palm Oil (RSPO) standards. Traceability systems allow tracking oils from plantations to end products, giving consumers assurances regarding sustainability compliance. Sustainable and traceable oils command a premium over conventional oils and their demand is expected to rise substantially over the coming years, presenting lucrative opportunities for compliant producers.

Porter’s Analysis

Threat of new entrants: The soy oil and palm oil market has moderate threat of new entrants due to high capital requirements for machinery and processing plants.

Bargaining power of buyers: Buyers in this market have high bargaining power due to availability of substitutes and undifferentiated nature of products.

Bargaining power of suppliers:
Suppliers have moderate bargaining power due to availability of substitutes.

Threat of new substitutes:
Threat of substitutes is high as vegetable oils like canola, sunflower and corn oil are substitutes for soy and palm oil.

Competitive rivalry: The market is dominated by few large players resulting in high competitive rivalry.

Key Takeaways

The Global Soy Oil And Palm Oil Market is expected to witness high growth. Regional analysis comprises Asia Pacific dominates the global market and is expected to continue its dominance during the forecast period. Key factors contributing to its leading position include high availability of raw materials and growing food processing industry.

Regional analysis
The Asia Pacific region dominates the soy oil and palm oil market, accounting for around 65% of the global demand in 2023. Countries like Indonesia, Malaysia, China, and India are the major producers and consumers in this region. Increasing demand for cooking oil and rising consumption of packaged food has been driving the market growth.

Key players
Key players operating in the soy oil and palm oil market are Cargill, Inc., PT Astra Agro Lestari Tbk, Wilmar International Ltd, Carotino Sdn Bhd, Yee Lee Corporation Bhd, IOI Corporation Berhad, Archer Daniels Midland Company, Dow DuPont Inc., and Guangxi Long’an Ruifeng Industrial & Trading Co., Ltd. Cargill and Wilmar International are the largest players in the global market and have been expanding their production capacity and distribution networks across Asia Pacific and South America regions.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it