Market evolution: Palm kernel oil (CN 151321) — 2015–2025
Introduction
This report analyses the European Union's trade in crude palm kernel and babassu oil (customs code 151321) over the period 2015–2025. This product, classified under CN heading 1513, encompasses crude palm kernel oil and babassu oil in various packaging formats, used both for food manufacturing and technical or industrial applications. The analysis draws on Eurostat trade data at annual frequency and covers imports, exports, partner concentration, supply volatility, and the EU's structural vulnerability to external supply shocks. Over this decade, the EU market has been shaped by surging unit prices, a dramatic reorientation of import sourcing away from Indonesia, and the near-complete disappearance of EU exports.
1. Structural surge in import value despite falling volumes
Import expenditure rose while physical volumes contracted
The most striking macro-level dynamic of the period is the divergence between import value and import quantity. Over the full window, EU imports of crude palm kernel oil increased in value by +29.2%, from €435.3 million in 2015 to €562.5 million in 2025, even as imported volumes fell by –38.0%, from 514,881 tonnes to 319,414 tonnes. This implies that unit prices more than doubled, rising +108.3% from €845/t to €1,761/t. The EU thus paid substantially more for significantly less product.
| Indicator | 2015 | 2025 | Change |
|---|---|---|---|
| Import value (€ million) | 435.3 | 562.5 | +29.2% |
| Import quantity (kt) | 514.9 | 319.4 | –38.0% |
| Import price (€/t) | 845 | 1,761 | +108.3% |
The 2021–2022 price spike was the pivotal event
The data reveals that the period's minimum import quantity (319,414 t) coincided with the period's maximum import value (€643.5 million, reached in 2022). The year 2021 stands out as the inflection point: supply shock analysis identifies price shocks from Indonesia (abnormality 57.7, shift +76.8%), Colombia (abnormality 44.7, shift +83.2%), and Honduras (abnormality 32.4, shift +71.4%) centred on 2021. This coincides with the global edible oils price surge driven by post-pandemic demand recovery, labour shortages in Southeast Asia, and rising energy and fertiliser costs — factors well documented in the broader vegetable oils market.
EU exports have all but disappeared
On the export side, the decline has been near-total. EU exports fell from €7.4 million (5,766 tonnes) in 2015 to just €44,665 (6 tonnes) in 2025 — a contraction of –99.4% in value and –99.9% in volume. The Herfindahl-Hirschman Index for export concentration fell from 9,585 to 2,174 (–77.3%), reflecting not a diversification of export markets but rather the collapse of what were once concentrated shipments to the United Kingdom (from €7.2 million to essentially zero) and Serbia. The EU has transitioned from a marginal re-exporter to a pure import market.
The trade deficit widened substantially
The EU's trade balance in this product deteriorated from –€427.9 million in 2015 to –€562.5 million in 2025, a worsening of –31.5%. The deficit was at its widest (–€642.9 million) in 2022 during the peak of the price spike, before partially retreating as volumes continued to decline.
2. Diversification away from Indonesia reshaped the supply map
Indonesia's share collapsed while Latin American and African suppliers surged
The most consequential structural shift in the EU's import portfolio has been the dramatic decline of Indonesia. Indonesian imports fell from €162.2 million in 2015 to just €16.7 million in 2025, a decline of –89.7%. Indonesia was the EU's largest supplier at the start of the period; by 2025, it had fallen to a marginal position.
By contrast, several alternative suppliers recorded exceptional growth:
| Partner | 2015 (€ million) | 2025 (€ million) | Change |
|---|---|---|---|
| Malaysia | 142.7 | 197.0 | +38.1% |
| Papua New Guinea | 50.0 | 91.6 | +83.2% |
| Guatemala | 7.5 | 63.8 | +753.9% |
| Honduras | 15.9 | 42.7 | +169.1% |
| Colombia | 37.7 | 39.0 | +3.4% |
| Côte d'Ivoire | 4.5 | 23.4 | +415.1% |
| Indonesia | 162.2 | 16.7 | –89.7% |
Malaysia consolidated its position as the EU's primary supplier
Malaysia remained the EU's top import partner throughout the period, growing from €142.7 million to €197.0 million (+38.1%). While its volatility coefficient was moderate at 0.26, its value reached a peak of €280.1 million in 2022 before retreating. Malaysia's stability relative to Indonesia may partly reflect different regulatory trajectories: the EU's evolving stance on deforestation-linked palm oil may have disproportionately affected Indonesian sourcing, though the data alone cannot confirm causality.
New entrants from Latin America and West Africa filled the gap
The rise of Guatemala (+753.9%), Honduras (+169.1%), and Côte d'Ivoire (+415.1%) signals a geographic diversification of EU palm kernel oil sourcing. Guatemala's imports grew from €7.5 million to €63.8 million, and Côte d'Ivoire's from €4.5 million to €23.4 million. These shifts contributed to the decline in import concentration: the import HHI fell from 2,691 to 1,799 (–33.2%), moving the market from a moderately concentrated structure to a more distributed one.
EU member state import patterns diverged
Among EU reporting countries, the Netherlands overtook Germany as the largest importer, growing from €149.3 million to €244.4 million (+63.7%). Spain (+157.5%), Belgium (+160.5%), and Greece (from negligible to €4.2 million) also expanded substantially. Germany, while still the second-largest importer, saw its share decline by –10.9% to €204.9 million. This redistribution likely reflects shifts in downstream processing capacity and port logistics within the EU.
3. The EU's external dependence deepened despite domestic production growth
Domestic production expanded but could not offset import needs
EU production of crude palm kernel and babassu oil grew by +60.0% in quantity (from 1.50 billion kg to 2.40 billion kg) and +40.2% in value (from €911.8 million to €1,278.4 million) over the period. This growth in domestic production is notable, yet the EU's net import reliance remained essentially flat, moving from 49.7% in 2015 to 50.1% in 2025 (+0.8 percentage points). This suggests that domestic production growth was consumed by rising downstream demand rather than displacing imports.
The Netherlands emerged as the EU's most specialised hub
Specialisation analysis for 2025 reveals that the Netherlands has by far the highest revealed symmetric comparative advantage (RSCA of 0.74) in this product within the EU, with a production share of 97.9% of the EU total and a Revealed Comparative Advantage index of 6.75. Greece follows distantly (RSCA 0.37). The majority of other EU members — including Germany (RSCA –0.99), France (RSCA –1.00), and Spain (RSCA –0.96) — are net consumers with negligible domestic specialisation. This concentration of production in a single member state creates a structural dependency within the EU itself.
Trade intensity moderated while export propensity declined sharply
The EU's trade intensity — the share of production involved in international trade — declined from 85.2% to 78.8% (–7.6 percentage points). Meanwhile, export propensity fell more sharply, from 61.5% to 47.4% (–22.9%). The salience analysis confirms that trade intensity is the dominant vulnerability dimension (salience score 36.4 vs. 25.5 for export propensity). Together, these indicators depict an EU market that is increasingly inward-looking in its consumption of this product: importing crude oil for domestic processing and re-exporting very little.
Price volatility in key supply origins poses ongoing risk
The volatility analysis reveals significant variation in supply reliability across partners. Indonesia, despite its declining share, exhibits a coefficient of variation of 0.72, indicating highly erratic supply flows. Nigeria (CV 1.12), Gabon (CV 0.86), and Costa Rica (CV 0.87) show even greater instability. By contrast, Papua New Guinea (CV 0.11) and Malaysia (CV 0.26) are among the most stable suppliers. The 2021 price shocks from Indonesia, Colombia, and Honduras — with abnormality scores of 57.7, 44.7, and 32.4 respectively — underscore the vulnerability of the EU's supply chain to sudden disruptions in tropical oil-producing regions.
Conclusion
The EU's market for crude palm kernel and babassu oil over 2015–2025 has been defined by three converging trends: a structural repricing that doubled unit costs while halving physical volumes; a radical reorientation of sourcing away from Indonesia towards a more geographically diversified but still tropical-dependent supply base; and a deepening of the EU's external reliance despite significant growth in domestic production centred in the Netherlands. The trade deficit widened by 31.5%, and the near-total disappearance of EU exports confirms the bloc's transition to a purely import-dependent consumer. While supplier diversification has modestly reduced import concentration (HHI down 33%), the EU remains exposed to price shocks originating in volatile producing regions, as demonstrated by the 2021–2022 episode. The policy and commercial implications are clear: the EU's palm kernel oil market is more expensive, more dependent on external supply, and more geographically fragmented than it was a decade ago — and the underlying vulnerability to tropical supply disruptions remains structurally unchanged.