Market evolution: Crude palm oil (CN 15111090) — 2015–2025

Introduction

This report examines the evolution of EU trade in crude palm oil (excluding technical or industrial uses), classified under customs code 15111090, over the period 2015–2025. Crude palm oil is a globally significant vegetable oil used primarily in food manufacturing, and the European Union is one of its largest importers. Drawing on trade data with a general overview, the analysis reveals a market shaped by three major dynamics: a structural decline in import volumes coupled with soaring prices, a notable diversification of supply sources away from traditional Asian producers, and a persistent—though slightly easing—dependence on extra-EU imports that leaves the bloc exposed to global commodity shocks.

1. Less Volume, More Cost: The Price-Driven Import Trajectory

The most striking feature of the 2015–2025 period is the divergence between import quantities and import values. While the EU bought substantially fewer tonnes of crude palm oil, it paid significantly more for them—a pattern that reflects both global commodity price trends and evolving policy pressures.

1.1 Import volumes fell by nearly a quarter over the decade

EU import quantities of crude palm oil declined from 1,991,061 tonnes in 2015 to 1,512,507 tonnes in 2025, a drop of 24.0%. The peak year was 2017, when imports reached 2,696,199 tonnes; the 2025 figure represents the period's minimum. This contraction likely reflects a combination of tightening EU sustainability criteria—most notably the Renewable Energy Directive (RED II) phase-out of palm oil in biofuels by 2030—and shifting consumer preferences in food manufacturing. Detailed trade figures.

1.2 Import values nonetheless rose by over a third

Despite the volume decline, the total value of EU crude palm oil imports increased from €1,214,803,138 in 2015 to €1,661,892,154 in 2025—a 36.8% rise. The value peaked at €2,580,787,979 in 2022, a year of exceptional global commodity price inflation following the COVID-19 pandemic and the onset of the Russia–Ukraine conflict. The unit import price surged by 80.1% over the period, from €610/t to €1,099/t, peaking at €1,172/t in 2022. This price escalation far outstripped the volume reduction, driving up the overall cost of EU palm oil imports.

1.3 The trade deficit narrowed but remains substantial

The EU's trade balance in crude palm oil—always deeply negative given the bloc's near-total reliance on imports—narrowed from −€1,212,534,628 in 2015 to −€1,648,027,148 in 2025 (a change of −35.9% relative to the initial deficit). However, this masks a peak deficit of −€2,568,832,123 in 2022. The slight improvement by 2025 is attributable to falling volumes rather than to any meaningful reduction in price or growth in domestic substitution.

2. Diversification Away from Southeast Asia: A New Supplier Map

Over the decade, the EU's sourcing of crude palm oil underwent a structural shift. Traditional Southeast Asian suppliers lost ground, while Latin American and Central African producers gained prominence, reshaping the geographic concentration of the EU's import basket.

2.1 Indonesia's share collapsed; Guatemala and Costa Rica surged

Indonesia, the world's largest palm oil producer, saw its exports to the EU fall by 52.1% in value terms, from €291,360,915 in 2015 to €139,626,037 in 2025. In contrast, Guatemala's exports to the EU grew by 211.1% (from €121,812,299 to €379,016,891), making it the EU's top supplier by value. Costa Rica's growth was even more dramatic at 6,878%, rising from under €2 million to €135,534,127. Malaysia remained relatively stable (+0.2%), while Papua New Guinea (+21.5%), Colombia (+23.3%), and Honduras (+43.1%) all increased their positions. Partner-level import data.

2.2 Import concentration declined, reflecting supply diversification

The Herfindahl-Hirschman Index (HHI) for EU imports by value fell from 1,876 in 2015 to 1,454 in 2025—a 22.5% decline that indicates a more diversified supplier base. This is consistent with the shift away from Indonesia and towards a broader set of Latin American origins. The HHI dropped most sharply between 2017 and 2020, coinciding with the EU's increasing policy attention to deforestation-linked imports and the early effects of the EU Deforestation Regulation (EUDR) discussions. Import concentration data.

2.3 The Netherlands consolidated its role as the EU's palm oil gateway

Among EU member states, the Netherlands overwhelmingly dominates crude palm oil trade. Its imports grew by 73.4% in value (from €597,911,541 to €1,036,647,324), and it accounts for a disproportionately large share of both imports and re-exports. Spain also grew significantly (+148.2%), while Germany (−43.8%) and Italy (−39.6%) saw their import shares decline. The Netherlands' Revealed Symmetric Comparative Advantage (RSCA) score of 0.72 confirms its strong specialisation in this commodity within the EU, acting as a central redistribution hub. EU member state imports and specialisation data.

3. Persistent Import Dependence and the Paradox of Rising Exports

Despite efforts to reduce reliance on palm oil, the EU's structural import dependence remains overwhelmingly high. At the same time, a notable—if small-scale—rise in EU exports of crude palm oil reveals the bloc's role as a transit and re-export market rather than a self-sufficient producer.

3.1 Net import reliance barely budged from above 94%

The EU's net import reliance declined only marginally, from 96.8% in 2015 to 94.4% in 2025—a reduction of just 2.4 percentage points. Domestic EU production grew from 100,000 tonnes to 140,000 tonnes (+40%) in quantity, and from €80 million to €120 million (+50%) in value, but these volumes remain negligible against import levels. The EU is structurally unable to meet its demand domestically, given that palm oil requires tropical growing conditions. This leaves the bloc exposed to supply disruptions, geopolitical risk, and price volatility in producing regions.

3.2 EU exports of crude palm oil grew dramatically from a low base

A lesser-known dynamic is the sharp growth in EU exports of crude palm oil, which rose from €2,268,511 and 2,800 tonnes in 2015 to €13,865,006 and 14,462 tonnes in 2025—increases of 511% and 416% respectively. While still small in absolute terms relative to imports, this growth points to the EU's role as a re-exporter and transshipment point, particularly through the Netherlands and, to a lesser extent, Germany. The export propensity rose from 10.1% to 15.4% (+52.9%), the fastest-growing vulnerability metric and a signal that the EU's palm oil market is not purely absorptive.

However, export concentration surged: the export HHI more than doubled from 2,962 to 8,523 (+187.7%), with the United Kingdom becoming the overwhelmingly dominant destination (accounting for €12,772,535 of the €13,865,006 total in 2025, a 1,135% increase). This reflects the post-Brexit reconfiguration of trade flows, where crude palm oil shipped from EU ports now crosses the Channel as an export rather than an intra-EU transfer. Export partner data.

3.3 Supply volatility is concentrated in a handful of risk-prone origins

Volatility analysis reveals that several key suppliers exhibit high year-to-year variability in their trade with the EU. Indonesia shows a coefficient of variation (CV) of 0.67 in import values, while Costa Rica (0.77), Ecuador (0.76), and Côte d'Ivoire (1.00) are even more erratic. Among smaller suppliers, Liberia (0.97) and Gabon (0.71) also display significant instability. A specific supply shock was detected in 2020 for EU exports to the United Kingdom, where a 69.8% price shift with an abnormality score of 18.3 was recorded—likely linked to the disruption of post-Brexit trade arrangements. Volatility data.

Conclusion

Over 2015–2025, the EU's crude palm oil market evolved under the combined pressure of policy reform, global price inflation, and shifting trade geography. Import volumes contracted by nearly a quarter, but the associated cost rose by over a third due to an 80% increase in unit prices—a pattern that underscores the EU's limited leverage as a price-taker in global commodity markets. Geographically, the supply base diversified meaningfully away from Indonesia towards Latin American producers, particularly Guatemala and Costa Rica, likely driven by sustainability certification requirements and the looming implementation of the EU Deforestation Regulation. Yet despite these shifts, the EU's fundamental dependence on extra-EU imports remains essentially unchanged at around 94%, while the emergence of the bloc as a small but fast-growing re-exporter—concentrated heavily on the United Kingdom—adds a new layer of complexity to the trade picture. Looking ahead, the interplay between regulatory tightening (EUDR, RED II phase-out), global supply constraints, and the EU's inability to substitute imports domestically will continue to define this market.