Philippines Palm Oil Market Size and Share Outlook - Forecast Trends and Growth Analysis Report (2024-2032)

Philippines Palm Oil Market Growth

Growing demand from the food sector, rising implementation in biofuel, and the affordable rate of palm oil compared to other vegetable oils are crucial drivers for the growth of the Philippines palm oil market. Palm oil is widely used for culinary purposes due to its versatile cooking properties. Furthermore, palm oil is now being utilised in various other applications such as cosmetics, personal care items, and even animal feed formulations, providing ample opportunities for the market players.

The growing focus on the environmental impact of palm oil cultivation, including deforestation and biodiversity loss, has led to a shift towards sustainable palm oil production in the country. There is a noticeable rise in efforts dedicated to promoting ethical and sustainable practices in palm oil production.

According to Philippines palm oil industry analysis, significant advancements in agricultural technology have also been made to enhance crop management and increase yields. Some of these innovations include satellite monitoring of plantations, genetically modified crops with enhanced disease resistance and improved pest control methods.

Key Trends and Recent Developments

Growing production area, a robust network of processing mills and refineries, ongoing research, and favourable policy initiatives are accelerating the Philippines palm oil market value.

August 2024

The Philippine Palm Oil Development Council (PPDCI) identified the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) as an ideal area for palm oil plantations with a capacity extending up to 800,000 hectares. Further, it pointed out that the development of plantations in this region would largely contribute to the reduction of palm oil imports by the Philippines and promote self-sufficiency in the country.

May 2024

Garcia Refinery Corp. (Gareco) started the construction of its PHP 600 million palm oil refinery in Soccsksargen, the first of its kind in Mindanao, Philippines. The objective was to aid the development of the local palm oil industry. The facility produced high-quality palm oil derivatives such as palm olein, palm stearin, margarine and other products for both the local and international markets. Moreover, it was funded by the state-run Land Bank of the Philippines, which extended a loan worth PHP 450 million for the purpose.

January 2023

A private member bill was introduced in the House of Representatives proposing the establishment of a Palm Oil Development Authority in the Philippines. The objective was to prepare the local industry for possible exports. Currently, the palm oil industry in Philippines is mostly dependent on domestic production and imports. The bill proposed that smallholders and investors take advantage of the wide production area, enhanced production technologies, and best practices to raise production levels of palm oil in Philippines, facilitating exports in the long run. Moreover, the agency was proposed to be state-owned and controlled with an annual budget of PHP 100 million and a governing board headed by the Secretaries of Agriculture and Trade and Industry.

May 2022

The Suggested Retail Price (SRP) issued by the Department of Trade and Industry (DTI) for palm oil used as a raw material for toilet paper and instant noodles grew by 0.56% to 32.14%. In May 2022, the DTI issued the new Suggested Retail Prices (SRP) for 218 stock-keeping units (SKUs) of which 136 retained their previous SRP prices, whereas the DTI approved a minimum increase for the rest of basic necessities and prime commodities (BNPCs) including palm oil.

Growing Production Area Leading to an Enhanced Supply of Palm Oil in the Market

Palm oil supply in the Philippines is increasing rapidly due to the growing land use for the production of palm oil fruits, including nurseries and cultivation fields. In 2021, the Philippines announced the production of 522,861 metric tonnes of fresh fruit bunch equivalent to 104,572 metric tonnes of crude palm oil and around 26,143 metric tonnes of palm kernel oil. These came from approximately 63,380.85 hectares of production area, including 7 registered nurseries, identified by the Philippines Statistics Authority. The authority further estimated that the production area will grow by 1.3% from 2022 onwards, leading to a further increase in the supply of palm oil during the coming years.

Robust Processing Sector Increasing the Philippines Palm Oil Market Revenue

In the Philippines, palm oil is used both as the end product and raw materials for a variety of industries, including packaged instant food, cosmetics, personal care items, cleaning products, biofuel, and lubricants for industrial applications. The country’s palm oil processing sector makes this possible through its robust network of mills and refineries. According to an industry report, the Philippines had 11 operational mills with a total processing capacity of 275 metric tonnes of fresh fruit bunches per hour in 2023. The development of new mills in the region is expected to raise this capacity further, positively impacting the overall market revenue.

Research and Development Creating New Philippines Palm Oil Market Opportunities

Research and development associated with the palm oil sector is expected to create new market opportunities for both public and private players. For instance, the Philippines Coconut Authority (PCA) in collaboration with the ZRC Training Institute and Assessment Centre is conducting research to produce high-quality yet economical hybrid planting materials from existing palm varieties using DNA markers. Additionally, PCA has been researching to develop Dura groves for the high-yielding variety of Dura palms from parent since 2024. Similar efforts and developments in the coming years are expected to open new market opportunities for industry players.

Favourable Policy Initiatives Propelling Growth of Philippines Palm Oil Market

Favourable policies and initiatives by various government departments and agencies are propelling the overall industry growth. For instance, the Philippines Coconut Authority (PCA), a government agency responsible for developing coconut and palm oil industries in the Philippines is conducting awareness campaigns and training programmes on the recommended production protocols, guidelines, and product standards in collaboration with Technical Education and Skills Development Authority (TESDA) to ensure proper accreditation of farm and mill workers since 2024 onwards. Such initiatives are expected to raise the productivity levels of the industry in the long run.

Philippines Palm Oil Industry Segmentation

“Philippines Palm Oil Market Report and Forecast 2024-2032” offers a detailed analysis of the market based on the following segments:

Market Breakup by End Use

• Food and Beverage 
• Personal Care and Cosmetics 
• Biofuel and Energy 
• Pharmaceuticals 
• Others

Philippines Palm Oil Market Share

Based on end use, the market is divided into food and beverage, personal care and cosmetics, biofuel and energy, and pharmaceuticals, among others. The food and beverage sector accounts for a substantial market share as palm oil is used for deep frying due to its high smoke point and ability to withstand high temperatures, which makes it perfect for the preparation of several Filipino dishes. Moreover, it is used as a key ingredient in several processed food items including snacks, baked goods, and instant noodles, among others.