Market evolution: Palm stearin (CN 15119019) — 2015–2025

Introduction

This report examines the evolution of EU trade in solid palm oil fractions (CN 15119019) over the period 2015–2025. The product — commonly known as palm stearin — is a solid fraction of palm oil used extensively in food manufacturing, confectionery, and oleochemical applications. The EU market for this commodity has undergone significant transformation over the past decade, characterized by rising import values, increasing dependence on Southeast Asian suppliers, and a structural price shock that has reshaped the cost base of downstream industries. Drawing on trade data from the EU Trade Dashboard, this analysis identifies three principal dynamics: the surge in import values driven predominantly by price increases, the evolving concentration of supply sources and export destinations, and the growing structural vulnerability of the EU's position in this market.

1. A Decade of Rising Import Values Driven by Price, Not Volume

The most striking feature of the EU palm stearin market over 2015–2025 is the divergence between import volumes and import values. While the EU's physical intake of this product grew only modestly, the monetary cost of those imports nearly doubled.

Import values surged while quantities remained broadly stable

EU imports of palm stearin rose from €337 million in 2015 to €636 million in 2025, an increase of 88.8%. Over the same period, import volumes grew by only 6.1%, from 487,723 tonnes to 517,586 tonnes. The implication is clear: the cost increase was overwhelmingly driven by price rather than by a structural expansion of physical demand. The peak import value reached €792 million in an intermediate year, while the minimum stood at €331 million, underscoring the volatility of the period.

Unit import prices nearly doubled

The average import price per tonne rose from €691 in 2015 to €1,229 in 2025, a 77.9% increase. The price trajectory was not linear: it reached a maximum of €1,391 per tonne in an intermediate year before settling at the 2025 level. This price evolution reflects a combination of global factors, including tightening sustainability certification requirements (such as the EU's evolving stance on palm oil in renewable energy directives), supply disruptions in major producing countries, and broader commodity price inflation, particularly during the 2021–2022 period of global supply chain disruptions.

The trade deficit widened significantly

The EU's trade deficit in palm stearin grew from €304 million in 2015 to €595 million in 2025, a 95.8% deterioration. At its worst, the deficit reached €734 million. This widening reflects the asymmetric dynamics of imports and exports: while export values did grow (+24.5%), export volumes actually declined by 29.2% (from 30,607 tonnes to 21,682 tonnes), even as export prices rose by 75.7% to €1,892 per tonne. The EU thus finds itself importing more in value terms while exporting less in physical terms.

Summary of key trade aggregates

2. Southeast Asian Dominance and a Reconfigured Export Landscape

Behind the aggregate figures lies a more granular story about trading partners. On the import side, the market remains overwhelmingly concentrated on two Southeast Asian suppliers. On the export side, a notable reshuffling has occurred, partly reflecting the reconfiguration of European trade flows following Brexit.

Indonesia and Malaysia account for the vast majority of EU imports

The two largest suppliers — Indonesia and Malaysia — together represented approximately €607 million in import value in 2025, out of the top-seven partners' total of approximately €630 million. Indonesia's imports grew from €143 million to €264 million (+84.4%), while Malaysia's grew from €174 million to €344 million (+97.3%). This dual dependency on Southeast Asia has not diminished over the decade; if anything, it has deepened.

Minor suppliers show divergent trajectories

Among smaller suppliers, Colombia emerged as a growing source, with import values rising from €3.2 million to €7.6 million (+135.6%). Singapore also saw a dramatic increase (+638%), albeit from a very low base (€1.0 million to €7.3 million). By contrast, imports from Côte d'Ivoire declined by 36.6%, and those from the United Kingdom fell sharply by 77.2% — the latter consistent with post-Brexit trade reclassification.

The United Kingdom became the EU's primary export destination

On the export side, the United Kingdom rose from €6.0 million to €19.4 million (+225.8%), making it by far the largest destination for EU palm stearin exports. This reflects both geographic proximity and the UK's continued demand for processed food ingredients from EU-based processors. By contrast, exports to Uruguay collapsed by 88.0% (from €12.7 million to €1.5 million), and those to the Russian Federation fell by 73.9% (from €4.9 million to €1.3 million), likely reflecting geopolitical disruptions and sanctions. Serbia emerged as a notable new market, growing from €1.6 million to €4.3 million (+173.7%).

The Netherlands and Italy are the EU's main import gateways

Among EU member states, the Netherlands was the largest importer at €180 million in 2025, followed by Italy at €130 million. Spain saw the most dramatic growth (+252.4%), rising from €25 million to €87 million. On the export side, the Netherlands also surged dramatically as a re-exporter (+5,945%), while Denmark remained a significant exporter despite a 45.9% decline. These patterns suggest that the Netherlands functions as a major transshipment and processing hub for palm stearin within Europe.

3. Structural Vulnerabilities and Growing Import Dependence

Beyond the headline trade figures, the EU's palm stearin market exhibits several structural features that point to growing vulnerability — particularly in terms of supply concentration, import reliance, and price exposure.

Import concentration remained high and even intensified

The Herfindahl-Hirschman Index (HHI) for import concentration by value rose from 4,483 to 4,691 over the period, indicating an already highly concentrated market that became marginally more so. An HHI above 2,500 is generally considered to indicate high concentration; the EU's import structure for palm stearin is nearly twice that threshold. This means that supply disruptions in Indonesia or Malaysia — whether from weather events, policy changes (such as export restrictions), or sustainability-related trade barriers — would have outsized effects on the EU market.

Net import reliance increased markedly

The net import reliance ratio rose from 35.7% in 2015 to 48.7% in 2025, an increase of 36.4%. At its peak, it reached 55.0%. This metric captures the share of apparent consumption that must be met through net imports (imports minus exports). The rising trend indicates that EU domestic production has not kept pace with consumption needs, or alternatively, that the EU has become a less competitive exporter of processed palm stearin products.

EU production grew but not enough to offset import dependence

According to PRODCOM data, EU production of palm stearin increased from 1.24 billion kg to 1.59 billion kg (+28.4%) in quantity, and from €753 million to €1,771 million (+135%) in value. While this represents meaningful growth, it was insufficient to reduce import dependence. The production value increase exceeding the quantity increase by a wide margin suggests that EU producers have also faced significant cost pressures.

Trade intensity and export propensity both increased

The trade intensity (total trade as a share of production) rose from 41.9% to 56.1%, while export propensity (exports as a share of production) increased from 6.1% to 10.0% (+65.1%). The salience analysis identifies export propensity as the most dynamic indicator, with a salience score of 105, suggesting that the EU's engagement with international markets in this product has intensified. However, the rising trade intensity also implies greater exposure to global market conditions.

Some supply channels show significant price volatility

The volatility analysis reveals substantial variation in the stability of different trading relationships. For imports, India (CV: 2.06), Ghana (1.45), and Cameroon (1.44) show the highest coefficient of variation, though they represent small volumes. Among major suppliers, Indonesia (CV: 0.16) and Malaysia (0.11) are relatively stable, which provides some reassurance given their dominant market share. On the export side, Norway (CV: 3.04) and the United States (1.54) show the highest volatility. Notably, a price shock event was detected for Swiss export prices in 2022 (abnormality score: 652.9), coinciding with the broader commodity price spike of that year.

Denmark and the Netherlands lead EU specialisation

The specialisation analysis for 2025 shows Denmark with a Revealed Symmetric Comparative Advantage (RSCA) of 0.81 and an RCA of 9.63, indicating very strong export specialisation in this product. The Netherlands follows with an RSCA of 0.55 and RCA of 3.45. At the other end of the spectrum, Slovenia, Hungary, Portugal, Slovakia, and Austria show RSCA values close to -1.0, indicating near-total import dependence with negligible domestic production or export capacity.

Conclusion

The EU's palm stearin market over 2015–2025 has been shaped by three interrelated forces: a dramatic price-driven increase in import costs, deepening dependence on Southeast Asian suppliers, and a structural rise in import reliance that domestic production growth has failed to offset. While EU production expanded by 28% in volume and 135% in value, the net import reliance ratio climbed to nearly 49%, and the trade deficit nearly doubled to €595 million. The market remains heavily concentrated on Indonesia and Malaysia, with an HHI approaching 4,700 — a level that signals significant vulnerability to supply-side disruptions.

On the export side, the landscape has been partially reconfigured, with the United Kingdom emerging as the dominant destination and the Netherlands consolidating its role as a processing and re-export hub. The departure of Russia and Uruguay as significant export markets reflects broader geopolitical and trade realignments.

Looking ahead, the EU's position in the global palm stearin market will likely continue to be influenced by the interplay between sustainability regulation (particularly the EU Deforestation Regulation), global commodity price dynamics, and the evolution of domestic processing capacity. The data suggests that while the EU has made some progress in building export capabilities, its fundamental exposure to import price volatility and supply concentration remains a defining feature of this market.