Market evolution: Crude palm oil (CN 151110) — 2015–2025

Introduction

This report analyzes the trade dynamics of crude palm oil (customs code 151110) for the European Union over the 2015-2025 period. The EU remains a major global consumer of this commodity, but the decade has been marked by a structural contraction in import volumes, a significant realignment of supply sources, and a persistent, though slightly improved, trade deficit. Key trends include a pivot away from traditional Southeast Asian suppliers towards Latin America, a rise in unit values, and a long-term strategy to diversify import origins to enhance supply resilience.

1. A Structural Contraction in Import Volumes and Value

The EU's import profile for crude palm oil underwent a profound contraction between 2015 and 2025, characterized by falling volumes and fluctuating, but ultimately lower, total value. This indicates a long-term reduction in demand or a substitution effect with other oils.

• Sharp Decline in Physical Imports: The quantity of crude palm oil imported into the EU fell from 4.83 million tonnes in 2015 to 1.68 million tonnes in 2025, a dramatic 65.3% decrease. The peak volume was recorded in 2017 at 5.34 million tonnes.
• Resilient but Ultimately Lower Import Value: Despite the volume collapse, the value of imports followed a more volatile path. It peaked at €3.43 billion in 2022 before declining to €1.85 billion in 2025, a 37.5% drop from the 2015 starting point. The disconnect between the sharper volume fall and the softer value decline is explained by rising prices.
• A Dramatic Increase in Unit Import Prices: The average import price per tonne surged from €614 in 2015 to €1,104 in 2025, an 79.9% increase. This price escalation reflects broader global market trends, including increased sustainability compliance costs and inflationary pressures.

Table 1: Evolution of EU Imports of Crude Palm Oil (2015 vs. 2025)

2. Geographic Reorientation: From Southeast Asia to Latin America

The most striking structural shift has been the reconfiguration of the EU's supply chain. Traditional giants Indonesia and Malaysia saw their market shares collapse, while suppliers from the Americas dramatically expanded theirs.

• Collapse of Traditional Suppliers: Indonesia's exports to the EU plummeted from €1.37 billion in 2015 to just €202 million in 2025, a 85.3% decrease. Malaysia's exports fell by 54.5%, from €957 million to €435 million. This decline is widely attributed to EU sustainability policies and market concerns over deforestation linked to palm oil production in the region.
• Rise of Central American Suppliers: In contrast, suppliers from Guatemala, Honduras, and Costa Rica significantly increased their exports to the EU. Guatemala's exports grew by 212.8%, becoming the third-largest supplier. Costa Rica experienced an explosive 6,934.2% increase, moving from a marginal supplier to a major one. This shift suggests EU importers have actively sought alternative sources, likely prioritizing those with certified sustainable practices.
• Diversification Reduces Supply Concentration: The Herfindahl-Hirschman Index (HHI) for import value concentration dropped sharply from 3,285 in 2015 to 1,490 in 2025, a 54.6% decrease. This move from a highly concentrated to a moderately concentrated market indicates a successful strategy to reduce dependency on a few key origins.

Table 2: Key Shifts in EU Import Partners (2015 vs. 2025)

3. The EU's Structural Dependency and Evolving Trade Flows

While the EU has reduced its import reliance slightly, it remains overwhelmingly dependent on external suppliers. Simultaneously, the bloc's own export patterns have evolved, particularly towards the United Kingdom post-Brexit.

• Persistent Net Import Dependency: The EU's net import reliance remained extremely high, moving from 96.8% in 2015 to 94.4% in 2025. This marginal improvement confirms that domestic production (which grew by 40% in volume) is negligible in meeting demand. The EU's trade deficit, though reduced by 37.9% to €1.84 billion in 2025, underscores this structural dependency.
• A Concentrated but Growing Export Profile: EU exports of crude palm oil grew from €3.5 million in 2015 to €13.9 million in 2025. This trade is highly concentrated and volatile, with the HHI for exports increasing by 94.3%. The United Kingdom became the dominant destination, receiving €12.8 million in 2025 (92% of total EU exports), a 484% increase from 2015, highlighting a clear post-Brexit trade realignment.
• Divergent Specialisation within the EU: The Netherlands is by far the most specialised EU member state in crude palm oil trade, with an RSCA of 0.73 in 2025. It acts as the primary gateway for imports into the bloc. In contrast, major economies like Italy, Germany, and France have negative RSCA values, indicating they are net importers and not specialised in this product's trade.

Conclusion

The 2015-2025 period represents a transformative decade for the EU's crude palm oil market. Faced with policy and reputational pressures, the bloc successfully executed a strategic pivot, drastically reducing imports from traditional Southeast Asian suppliers in favour of Latin American alternatives. This diversification lowered supply concentration risk but came at the cost of significantly higher prices and a halving of import volumes, suggesting reduced overall consumption or substitution. The EU remains fundamentally dependent on imports, with its trade deficit now smaller but concentrated on fewer, higher-cost suppliers. The surge in exports to the United Kingdom marks a new, post-Brexit feature of the market. Overall, the data paints a picture of a market undergoing deliberate structural change in response to external pressures, moving towards a smaller but more resilient supply base.