Market evolution: Industrial hydrogenated oils (CN 1516) — 2015–2025

Introduction

This report examines the evolution of EU trade in Animal, vegetable or microbial fats and oils and their fractions, partly or wholly hydrogenated, inter-esterified, re-esterified or elaidinised (CN 1516) over the 2015–2025 period. CN 1516 is a bundling heading that covers three sub-categories: animal fats and oils (CN 151610), vegetable fats and oils (CN 151620) — the dominant segment — and microbial fats and oils (CN 151630). These products are used extensively in the food industry (margarine, confectionery fats, bakery shortenings) and, increasingly, in industrial applications. The decade under review was marked by three overarching dynamics: a structural divergence between value and volume, a dramatic supply shock in 2022, and a reshaping of the EU's trade geography. Taken together, these trends paint a picture of a market that has become more expensive, more volatile, and more closely balanced between imports and exports.

I. Rising Values, Falling Volumes: The Price-Driven Expansion

EU exports grew in value but contracted in physical volume

Over the full period, EU exports of CN 1516 rose from €158.8 million (2015) to €244.7 million (2025), a gain of 54.1% in value. Over the same span, exported volumes fell by 14.6%, from 78,729 tonnes to 67,232 tonnes. The entire increase in export revenue was therefore driven by higher unit prices, which climbed 80.4% — from €2,017/t to €3,638/t. The trade overview confirms that export volumes peaked at 108,678 tonnes in 2017 before entering a sustained decline, while the value peak of €280.6 million was reached in 2022 — at the height of global commodity price inflation.

Import trends followed the same pattern, but with even steeper price increases

EU imports grew 80.5% in value, from €129.3 million to €233.4 million, while volumes fell 13.6% (from 75,215 to 64,981 tonnes). Import unit prices surged 108.9%, rising from €1,719/t to €3,591/t. The volume trajectory was considerably more volatile on the import side: volumes swung from a low of 49,509 tonnes to a high of 202,254 tonnes within the period, reflecting the high sensitivity of EU importers to global supply conditions and price signals.

The EU's trade surplus eroded toward balance

In 2015, the EU held a comfortable trade surplus of €29.5 million in CN 1516. By 2025, this had narrowed to just €11.3 million — a contraction of 61.7%. At its lowest point, the balance briefly turned negative (−€17.5 million in 2020), indicating that the EU was temporarily a net importer. The net import reliance metric confirms this convergence: it moved from −14.8% in 2015 (signifying a net export position) to −1.6% in 2025, a shift of 89.4% toward neutrality. The EU's export propensity declined marginally (−7.5%), while trade intensity — the share of domestic production that crosses borders — rose from 23.4% to 28.7%, pointing to a market that is increasingly intertwined with global supply chains.

II. The 2022 Supply Shock: Anatomy of a Price Crisis

Global edible oil markets triggered the sharpest price dislocations on record

The year 2022 stands out as an inflection point. The supply shock analysis identifies three major shock events, all centred on 2022:

Indonesia and Malaysia — the EU's two largest suppliers of vegetable-based hydrogenated oils — experienced price spikes of 300% and 381% respectively. These anomalies were driven by the convergence of several factors in 2022: Indonesia's temporary palm oil export ban (April–May 2022), the disruption of sunflower oil supplies following Russia's invasion of Ukraine, and broader global energy and food commodity inflation. The shock was overwhelmingly concentrated in imports of CN 151620 (vegetable oils), which saw its unit price leap from €1,122/t in 2021 to €3,149/t in 2022 — a near-tripling.

Post-shock prices have partially normalised but remain elevated

By 2025, import prices for CN 151620 had settled at €2,388/t — lower than the 2022 peak but still more than double the 2015–2019 average of approximately €1,200/t. Export prices followed a similar arc, rising from €2,444/t in 2021 to €3,304/t in 2025 for vegetable oils. The persistence of elevated prices suggests that the 2022 shock was not merely a transient spike but established a new, higher price baseline, likely reflecting structural adjustments in global palm and seed oil markets.

Import volatility remains concentrated in Southeast Asian supply

The volatility analysis shows that Indonesia and Malaysia have the highest coefficient of variation (CV) among import partners — 1.00 and 1.03 respectively — indicating that year-to-year import flows from these countries are highly unstable. By contrast, the EU's top export partners (United Kingdom, Norway, Japan) display far lower volatility (CVs of 0.23, 0.17, and 0.18), reflecting the more diversified and stable nature of the EU's outbound trade relationships.

III. A Changing Trade Map: Diversification, Production Decline, and the Rise of Microbial Oils

Import sourcing has diversified, reducing single-supplier concentration

The Herfindahl-Hirschman Index (HHI) for EU imports declined from 1,509 to 1,196 (−20.7% in value terms), indicating a meaningful reduction in supplier concentration. In 2015, the "unspecified" partner category alone accounted for €26.0 million in imports; by 2025 this had fallen to €12.7 million. Simultaneously, previously marginal suppliers grew rapidly:

Norway's surge is particularly notable: it went from a mid-tier supplier to the EU's largest single import source by value in 2025 (€47.9 million). This likely reflects growing imports of hydrogenated marine oils and fractions (CN 151610), where Norway has a strong production base. India also more than tripled its shipments, consistent with the country's expanding vegetable oil processing sector.

Export destinations shifted markedly in response to geopolitical developments

On the export side, the most dramatic change was the collapse of exports to the Russian Federation — from €10.7 million in 2015 to just €3.4 million in 2025 (−67.7%). This decline, which accelerated after 2021, aligns with the progressive deterioration of EU–Russia trade relations and the sanctions regime. By contrast, exports to Switzerland (+286.4%), Serbia (+233.2%), and Algeria (+66.2%) grew substantially, suggesting that EU exporters redirected flows toward neighbouring and developing markets.

The export concentration HHI also declined (from 783 to 626, −20.0%), indicating a more diversified export portfolio by 2025.

EU domestic production has contracted sharply in volume

Perhaps the most striking structural shift is the collapse in EU production volumes. Domestic output fell by 53.1% — from 1.75 billion kg to 820 million kg — over the period. Production value, however, declined by only 1.3% (from €1.26 billion to €1.24 billion), confirming that unit values in domestic production rose nearly as steeply as in trade. This volume collapse likely reflects the combined effect of EU health-driven demand shifts away from partially hydrogenated fats (linked to trans-fat concerns), higher input costs, and competition from alternative processing technologies such as inter-esterification.

Among EU Member States, specialisation in CN 1516 exports is heavily skewed: Sweden (RSCA: 0.69), the Netherlands (0.38), and Denmark (0.21) are the most specialised exporters, accounting together for a large share of EU outbound trade. By contrast, large economies like Poland (RSCA: −0.89) and Czechia (−0.93) are highly unspecialised, suggesting that production is concentrated in a handful of northern and western European states.

Microbial oils (CN 151630) emerged as a nascent but fast-growing segment

A final noteworthy development is the appearance of microbial fats and oils (CN 151630) in the trade data from 2022 onwards. While volumes remain negligible (137 tonnes exported and 15 tonnes imported in 2025), the value figures are striking: exports reached €6.6 million in 2025, and imports €1.0 million, implying very high unit prices (€47,910/t for exports). This suggests that microbial oils — produced via fermentation rather than from traditional animal or plant sources — are entering the market as a premium, high-value niche. Their emergence aligns with the growing interest in novel lipids for food, cosmetics, and bio-based industrial applications, and may represent an early signal of structural diversification within the CN 1516 category.

Conclusion

The EU market for industrial hydrogenated and modified fats and oils (CN 1516) underwent significant transformation between 2015 and 2025. The overarching narrative is one of value inflation outpacing physical trade: both imports and exports grew substantially in euro terms while declining in tonnage, driven by a near-doubling of unit prices. The 2022 commodity crisis — rooted in Indonesia's palm oil export restrictions and the Ukraine conflict — served as the defining shock, establishing a permanently higher price floor. In response, the EU's trade geography diversified: import concentration fell, new suppliers (notably Norway and India) gained ground, and export flows were redirected away from Russia toward Switzerland, Serbia, and North Africa. Domestically, production volumes halved even as their value held steady, reflecting both demand-side shifts and cost pressures. Looking ahead, the nascent emergence of microbial oils hints at future product-level diversification within this category, even as the EU's position drifts from a net exporter toward trade balance — a trend that merits monitoring in the context of the bloc's broader strategic autonomy objectives.