Palm oil: Productive and versatile

The oil palm tree produces high-quality, versatile oils.

But it only grows in the tropics, where its cultivation can have disastrous impacts on people and the environment.
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Oil palm (Elaeis guineensis) fruits being loaded on truck. Tesso Nilo, Riau Province, Sumatra, Indonesia.
© Volker Kess / WWF
 / ©: Oil World

Multipurpose oil

Palm oil comes from the fruit of the oil palm tree (Elaeis guineensis). It can be separated into a wide range of distinct oils with different properties.

This versatility has seen palm oil replace animal and other vegetable oils in a wide variety of products.

Today it is:

  • used as a cooking oil
  • the main ingredient for most margarine
  • used in confectionary, ice cream and ready-to-eat meals
  • the base for most liquid detergents, soaps, and shampoos
  • the base for lipstick, waxes, and polishes
  • used as an industrial lubricant
  • used as a biofuel

Highly productive

In addition to its versatility, palm oil is also a very productive crop. The yield (amount of oil produced per hectare per year) is far greater than for other vegetable oils, while production costs are lower. This lower cost is mainly due to low labour costs in the countries in which palm oil is grown.

Originally a subsistence crop

The oil palm tree is native to West Africa, where it was traditionally cultivated as a subsistence crop for food, fibre and medicine.

Originally, trees were interplanted in traditional, small-scale agricultural production systems along with other annual and perennial crops.  

Now mainly grown in plantations

Rising demand for vegetable oils since the 1970s has seen oil palm cultivation shift to a large-scale plantations.

Such plantations have become one of the fastest-growing monocropping plantations in the tropics of Africa, as well as in Asia-Pacific, and Latin America and the Caribbean.

Much of this expansion has occured in Malaysia and Indonesia. By 2000, these two countries accounted for just over half of the world's total plantation area (then 9.7 million hectares), and Nigeria accounted for just over 30%.

Cultivation continues to expand – with dramatic consequences for biodiversity.

Sources: FAOClay (2004)

Quick facts

  • The share of palm oil in global vegetable oil production has more than doubled since the 1980s
  • Palm oil exports are almost twice as high as soy oil exports
  • Many countries depend on palm oil imports
  • Oil palm plantations are expanding more rapidly than almost any other agricultural commodity

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