Palm oil is an edible vegetable oil derived from palm fruits. With rapid increase in the per capita human consumption of vegetable oils, the demand for palm oil has increased in recent years. Palm oil is mainly used in food products, detergents, cosmetics, and biofuels. Boosting demand for this oil in all these products is estimated to heighten the sales of the market.
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In 2014, the worldwide palm oil market was valued at around USD 61,000 million. It is projected to experience significant growth in the next few years. The demand for the market has also grown due to the cost effectiveness coupled with low-fat content of palm oil. However, widespread deforestation for the production of palm oil has resulted in the extinction of several animals.
This has also led to climatic changes. All this has indirectly affected the market. The rapidly growing demand for palm oil from end-use industries is likely to remain the key driving factor of the market. Few agencies and governments have taken initiatives to restrain the consumption of trans-fat in the last few years. This has taken place considering health concerns.
The regulations concerning the blending of fuels with bio-based ones and growing usage of palm oil as bio-diesel have gained acceptance in the last few years. Environmental concerns regarding lubricants, surfactants and bio-based cosmetics and shifting customer preferences have also prompted the sales of the palm oil market.
In 2014, crude palm oil led the worldwide market. It was followed by kernel oil and cake. Palm kernel cakes are primarily utilized in the industry of animal feed. Rising demand for animal feed in Asia Pacific and North America is expected to assist the demand for palm kernel cakes. Accentuating demand for the cosmetics industry is also estimated to be beneficial for the palm oil market.
The global market was dominated by edible oil. It was followed by surfactants, lubricants and bio-diesel. Health apprehensions with respect to the consumption of trans-fat have shifted the preferences of consumers to low trans-fat from vegetable oils and animal fats consisting of high-trans fat.
In 2014, the palm oil market was dominated by Asia Pacific. The Middle East, Asia Pacific and Africa would experience rapid growth in the manufacturing and food sectors. Indonesia and Malaysia presently lead the worldwide production of palm oil.
They are the prime exporters of palm oil and envelop a vast chunk of businesses.
Due to the existence of favorable climatic conditions and arable land, the regions of Africa, and Central and South America are estimated to undergo fast develoment coupled with increasing production capacities.
Key Market Participants
The players of the palm oil market are taking steps to gain a robust foothold on the worldwide market. They are also aiming at augmenting their product line. Few of the leading participants are Alami Group, IOI Corp., Sime Darby, Godrej Agrovet Limited, Kulim Bhd and PT Astra Agro Lestari Tbk. The rest are Golden Agri Resources Ltd., Wilmar International Ltd, Musim MAs Group and London Sumatra.
Information Source: Grand View Research