The global market for palm-based oleochemicals (excluding stearic acid and RBD palm oil) has been on a strong upward trajectory since 2020 and is expected to maintain steady growth through 2040. This expansion is fueled by rising demand for bio-based and eco-friendly chemicals across industries, reflecting a larger global transition toward sustainable solutions. The sector’s market size, key derivatives, regional dynamics, trade flows, and competitive positioning against petrochemicals underscore its pivotal role in shaping the bioeconomy.

A Growing Market Backed by Strong Demand Across Industries

As of 2023, the palm oil-based oleochemicals market was valued at USD 5.2 billion. Forecasts suggest it will grow at a CAGR of 4.3% to 5.2% from 2023 to 2034, potentially reaching USD 8.2 billion to USD 37.9 billion by 2033–2034, depending on market scope and data sources. Looking further ahead, projections through 2040 point to consistent growth, with personal care, pharmaceuticals, detergents, and bio-based chemicals emerging as core drivers aligned with global sustainability initiatives.

Among oleochemical derivatives, several stand out for their high demand. Fatty alcohols are widely used in personal care products and detergents, while glycerin serves as a critical humectant in cosmetics and pharmaceuticals. Lauric acid, valued for its antimicrobial properties, remains essential in soap and detergent manufacturing, and fatty amines continue to find strong application in fabric softeners, corrosion inhibitors, and pharmaceuticals. Together, these derivatives anchor the sector’s growth and its expanding role in consumer and industrial markets.

Demand growth is also being shaped by industries embracing eco-friendly inputs. In personal care and cosmetics, oleochemicals account for more than 50% of consumption, as consumers increasingly favor natural ingredients. In pharmaceuticals, they are critical in emulsifiers and drug delivery systems, while in detergents and soaps, they are replacing petrochemicals to improve biodegradability and performance. Expanding applications in biodiesel, lubricants, and green solvents further broaden their market footprint.

Regional Strengths, Trade Dynamics, and the Path Ahead

Geographically, Southeast Asia dominates production. Indonesia and Malaysia together account for over 70% of global palm oil output, giving ASEAN a decisive advantage as the largest supplier of oleochemicals. On the demand side, China and India are expanding rapidly, with CAGRs of 6.4%–6.6%, driven by industrial growth and strong demand in cosmetics and pharmaceuticals, despite heavy reliance on imports. The European Union, projected to reach USD 5.85 billion by 2025, stands as the second-largest market, driven by stringent sustainability standards and green chemical adoption, with the Netherlands, Spain, and Germany leading imports. Meanwhile, North America continues to grow steadily, with exports totaling 321,287 MT valued at RM 1.43 billion in 2020, supported by personal care and industrial applications.

Trade statistics confirm Southeast Asia’s role as the primary exporter of fatty acids and glycerin derivatives. This demand is propelled by three main factors: the growing adoption of eco-friendly and biodegradable products, the regulatory push for bioeconomy policies in Europe, North America, and Asia, and heightened consumer awareness of green alternatives to petrochemical products.

In terms of competitiveness, palm-based oleochemicals benefit from renewable and sustainable feedstocks, superior biodegradability, and compliance with global regulations such as REACH and FDA standards. However, the industry must continue to navigate challenges related to production costs and supply chain complexities.

Looking toward 2040, steady market expansion is expected, supported by biotechnological advances, new applications in pharmaceuticals and biofuels, and ongoing investment in sustainable industrial chemicals. Asia-Pacific will remain the growth hub, with significant investments in production capacity and innovation. Overall, the market is likely to sustain a CAGR of around 5% or higher, potentially doubling in size by 2040, in line with global bioeconomy and sustainability goals.

In conclusion, the palm-based oleochemicals market is emerging as a cornerstone of the global bio-based chemicals sector. With strong momentum across fatty alcohols, glycerin, lauric acid, and fatty amines, coupled with robust regional production in ASEAN and surging demand in Asia, Europe, and North America, the industry is well-positioned for long-term growth. Backed by regulatory support and rising consumer preference for green alternatives, palm oleochemicals are set to strengthen their role as competitive, eco-friendly substitutes to petrochemical counterparts well into the next two decades.

 

Sources:

  1. Transparency Market Research - Palm Oil-based Oleochemicals Market Size, Share, Report 2034
    https://www.transparencymarketresearch.com/palm-oil-based-oleochemicals-market.html

  2. Market Research Future - Palm Oil Based Oleochemicals Market Research Report (Forecast to 2034)
    https://www.marketresearchfuture.com/reports/palm-oil-based-oleochemicals-market-39198

  3. Grand View Research - Oleochemicals Market Size, Share & Growth Report, 2030
    https://www.grandviewresearch.com/industry-analysis/oleochemicals-industry

  4. Precedence Research - Oleochemicals Market Size to Hit USD 52.88 Bn by 2034
    https://www.precedenceresearch.com/oleochemicals-market

  5. Mordor Intelligence - Oleochemicals Market Size, Share & Growth Research Report, 2030https://www.mordorintelligence.com/industry-reports/oleochemicals-market