Palm oil, an edible vegetable oil made from the fruit of the palm tree is one of the most consumed in the world today. Palm oil is used in almost all kinds of processed foods and products, especially in cosmetics, toothpaste, chocolate noodles, bread, ice cream, animal feed, wax, biofuels and many other essentials. In addition, palm oil does not have distinct odor and due to its creamy texture, it acts as an alternative to butter in baking. People around the world consume an average of 8 kg of palm oil in different ways every year. This oil is used so much because the price of palm oil as a raw material is much lower than the unique oil. In June 2021, the global one metric ton soybean oil price was 1438 USD, olive oil 4490 USD and sunflower oil 1586 USD. But compared to that, the price of per metric ton palm oil was only 920 USD. In today’s article I will tell you why the price of palm oil is so low.

History and Annual Production of Palm Oil

why palm oil is so cheap
First palm oil factory

Patterns of palm oil use have been found since ancient times. The use of palm oil has been known since 3000 BC. In the late 1800s, archaeologists discovered palm oil in a tomb in Abydos, Egypt. However, it is thought that the Arab traders brought this oil. Palm trees originally came from West and South West Africa. In the early 19th century, Central Africa and Southeast Asia and Europeans began commercial palm cultivation. This series led to the discovery in 1902 of a high-yielding variety of palm oil in Cameroon. This variety is still widely used in commercial plantations. First commercial palm cultivation began in Indonesia and Malaysia in the late 19th and early 20th centuries. Palm trees grow naturally in tropical rain forest areas. In the 1990s, Malaysia became the world’s largest producer of palm oil. At that time, global palm oil production was close to 11 million metric tons. Since then, palm oil has become one of the most popular edible oils in the world. Between 1990 and 2010, about 9.6 million hectares of land in Indonesia, Malaysia and Papua New Guinea were converted into industrial palm oil farms. Palm oil is the largest agricultural export product in Malaysia and Indonesia, accounting for 4.3 percent of Malaysia’s GDP in 2010 and 1.4 percent of Indonesia’s GDP. This two countries employ 3.5 million workers in the palm oil industry. In 2016, 72 million tons of palm oil was produced worldwide. Of which Indonesia produced 41 million tons and Malaysia 20 million tons. In 2018, 84% of the world’s palm oil came from Indonesia and Malaysia. In 2019, Indonesia was the exporter of 15.3 billion USD palm oil. In 2020, the global palm oil market will reach 48.1 billion USD. According to experts, the size of palm oil will increase by 4.4 percent per year in 2021-2026.

Palm Oil Nutrients and Manufacturers

health benifit of palm oil
health benefits of palm oil

The top few companies in terms of palm oil production are Wilmar, Sime Darby, Golden Agri Resources Ltd. These are basically known as the leading players of the palm oil market. Because palm oil blends easily with other oils. Although palm oil is used in most consumer products, in many cases consumers do not know that the product contains palm oil. This is because most products use different names for vegetable oil, vegetable fat, glyceryl, stearate, stearic acid, etc. without using the name of palm oil directly.
In terms of nutrition, this palm oil is easy to digest, rich in carotenoids and rich in vitamins. However, the saturated fat of palm oil is higher than that of the unique liquid oil.Palm oil contains about 34% saturated fat, but olive oil contains less than half the saturated fat. Saturated fats are one of the leading causes of heart disease and chronic health conditions. Also according to Webmd’s data , taking extra palm oil raises cholesterol levels in the human body. The reason why this oil is used in all products starting from edible products is because palm oil acts as a natural preservative. As a result, foods made with this oil do not require a separate preservative. As a result, palm oil producers have increased their use of palm oil to reduce manufacturing costs, and increased demand for palm oil worldwide. Palm oil is one of the most consumed vegetable oils in the world. But why is the price of palm oil so low despite so much consumption and so much demand?

Palm tree cultivation method

palm oil orchard
Palm oil orchard
why palm oil is so cheap Palm oil orchard
Palm oil orchard

It does not cost much to prepare the land for palm trees. To plant palm trees, large areas of forest are burned. After clearing the land and sowing the seeds, the palm trees start growing naturally. This tree grows well in tropical rain forest area. But in order to cultivate mustard oil, it is necessary to dry the soil well and sow the seeds after the land is fully prepared. This is because if the soil is not properly plowed and If seeds are sown in high humidity soil, germination is done properly but the growth of mustard plant is very slow. Although it is possible to cultivate mustard in relatively high lands in this way, it is almost impossible to cultivate mustard in low lands and coarse soils. As a result, mustard cultivation is not possible. But palm trees grow on any type of land. And there are no separate rules for care. As a result, its cultivation cost is much lower than that of other oil. Palm trees are usually evergreen and bear fruit all year round. Mustard or sunflower usually bears fruit only in one season. Once the fruits or flowers are given, they have to be replanted next year. But in the case of palm oil, once planted, there is no cost. Palm trees are planted just before the start of monsoon in Indonesia . It takes four years for a palm tree to bear fruit. But once it starts bearing fruit, it continues throughout the year. Palm fruit is available throughout the year as it is much easier to find than the other vegetable oil or seeds available. Each palm tree is about 40 feet tall and bears fruit for up to 30 years. Palm oil seeds are one of the most productive vegetable oil seeds in the world. Usually about 60 palm trees are planted on one acre of land. Compared to other edible vegetable oils, it requires very little space to grow. Palm oil yields about 5 to 10 times more per hectare than other major vegetable oils. It is possible to plant so many trees in a very small area. And the production of high yielding palm oil is much higher. In general, labor costs in Asian countries are lower than in other countries. As the palm oil industry is based in Asia, the cost of labor in this industry is much lower. Moreover, since palm trees grow naturally, not much labor is required to take care of the trees. As a result, there is less labor cost in palm tree farms.

Palm oil/fruit processing

palm oil processing
Palm oil processing

The process of collecting and storing oil through palm fruit processing is not so complex and expensive. Palm fruit is first collected from palm trees for palm oil processing. Palm fruits are usually in bunches. Bunches of fruit are brought from the orchard to the factory for sterilization and then sent for pressing or threshing. As a result of threshing, a kind of fibrous pulp is made from the fruit . Palm oil is made from this pulp. This palm oil is then separated from the fiber through processing from the refinery. The fruit seeds and leftovers are crushed in another machine and processed for use as biofuel. Palm oil acts as a natural preservative. As a result, no separate measures have to be taken to preserve this oil. This oil can be stored at normal temperature.


Palm oil is the most popular vegetable oil in the world today and is highly profitable. The use of palm oil in the world is 34% of edible oil. Although a large amount of rain forest has been destroyed for palm cultivation. Usually all the trees in a large area are burnt for palm cultivation. Palm trees have no negative effects in nature. And palm oil is not too bad for the human body. However, burning large areas of forest for palm cultivation is detrimental to an area’s natural ecosystem and wildlife. To read other impostant article see from the below link Smartphone , facebook changing in metavarse, hma activation code 2021.

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