Palm oil industry in Latin America and the Caribbean - statistics & facts
What do lipstick, shampoo, ice cream, pizza dough, and instant noodles have in common? Palm oil. With almost 80 million metric tons produced in 2023, palm oil is the undisputed leader among edible oils produced on a global scale. Extracted from the fruit of oil palm trees, this popular oil mainly produced in Indonesia and Malaysia. However, some Latin American countries such as Guatemala and Colombia are also among the leading providers of palm oil worldwide.
Brazil
When it comes to consumption, in addition to Colombia, Brazil and Mexico are the biggest markets in Latin America. In 2023, Brazilians are expected to consume 930 thousand metric tons of palm oil, of which a significant share is used for industrial purposes. One of the most important Brazilian companies in the sector is Agropalma. With a workforce of over six thousand workers, it produces not only palm oil but also other derivatives, such as kernel palm oil extract and oil palm fiber.
Mexico
In contrast, the palm oil industry in Mexico is considerably smaller than that of Colombia and Brazil. However, the country has a high consumption demand, resulting in a recent increase in planted area, despite a slight drop in 2022. The North American country is the second-main importer of the product in Latin America and the Caribbean.
To promote more sustainable and ethical practices in this sector, organizations such as the Roundtable on Sustainable Palm Oil (RSPO) have emerged. However, many palm oil free products are emerging, especially in the health and environmentally conscious market. It remains to be seen, whether these efforts truly make a difference in production, or whether other measures will be introduced to curve the environmental impact of this oil industry.
Regional leaders - Colombia
Within the region, the main producer of palm oil is Colombia. In 2023, the country produced 1.8 million metric tons of crude palm oil. Locally, most crude palm oil is sold to the edible oils and fats industry. However, it is also sold to other industry sectors, such as that of soaps and biodiesel. The rest is exported. This has resulted in Colombia being the fourth major exporter of palm oil in the world, with Brazil, Mexico, and the Netherlands as its major market destinations.Brazil
When it comes to consumption, in addition to Colombia, Brazil and Mexico are the biggest markets in Latin America. In 2023, Brazilians are expected to consume 930 thousand metric tons of palm oil, of which a significant share is used for industrial purposes. One of the most important Brazilian companies in the sector is Agropalma. With a workforce of over six thousand workers, it produces not only palm oil but also other derivatives, such as kernel palm oil extract and oil palm fiber.
Mexico
In contrast, the palm oil industry in Mexico is considerably smaller than that of Colombia and Brazil. However, the country has a high consumption demand, resulting in a recent increase in planted area, despite a slight drop in 2022. The North American country is the second-main importer of the product in Latin America and the Caribbean.
Environmental challenges – the other side of the (oily) coin
While the Latin American palm oil market is a significant one, its massive use is causing worldwide environmental and social problems. Extensive cultivation of oil palm trees destroys rainforest ecosystems and the natural habitat of a wide variety of animal species. In addition, the industry, and more broadly the agricultural industry as a whole, has a large carbon footprint which largely contributes to global warming.To promote more sustainable and ethical practices in this sector, organizations such as the Roundtable on Sustainable Palm Oil (RSPO) have emerged. However, many palm oil free products are emerging, especially in the health and environmentally conscious market. It remains to be seen, whether these efforts truly make a difference in production, or whether other measures will be introduced to curve the environmental impact of this oil industry.
