The historical success of oil palm can be attributed, principally, to its intrinsic qualities. First, it is the most productive of all the vegetable oil crops globally, yielding 7x and 11x more oil per hectare than rapeseed and soybean, respectively, which exist as the two next most productive oils. Secondly, palm oil is one of the most versatile and widely applied substrate bases globally. Specifically, the food sector consumes about 70 percent of all palm production, it is also used as an input base for everything from margarines, soaps, lipsticks, and polishes to confectionary, cooking oils, surfactants, and industrial lubricants.
Third, palm oil is the most price competitive of the global edible/vegetable oils. Recently, the affordability of palm oil has driven its continued demand in high-consuming emerging markets such as India and China and also across Africa—an end market that is fast becoming a material consumer of the commodity on the back of its explosive demographic growth.
It contains 20-22% solid fats due to which palm oil is utilized in shortening, margarines and other fat products. It can also be combined with harder fat fractions in order to give them the required consistency without resorting to hydrogenation. Some of the other common palm oil products include cooking and frying oils, vegetable ghee, and non-dairy creamers. Rising awareness about these health benefits among the consumers is boosting the demand for palm oil worldwide.
Further, palm oil is readily replacing petroleum-based products as an effective alternative for fossil fuels in transportation and energy industries. Apart from this, it is also employed as a substitute to mineral oil in power stations for energy production. Moreover, initiatives undertaken by several governments across the world to curb trans-fat consumption is envisaged to boost the market growth.
On the basis of application, currently food applications account for the majority of total global market and are followed by non-food application