Prospects for palm oil

The relatively healthy picture for the palm oil industry has been somewhat dampened by negative campaigns.

For example, in May 2016, it was reported that Italy´s largest food retail chain, Cooperativa di Consumatori (Coop), had banned food products containing palm oil from its shelves.

Coop, which operates supermarkets and hypermarkets called Ipercoop as well as the discounter Dico, advertises the move on its website with the words ‘goodbye palm oil’.

The country’s energy supply is characterised by high dependence – of about 79% – on imports. Demand for energy is covered to about 36% by oil; to 35% by gas; to 15% by renewable energy; to 9% by solid fuel; and to 5% by imported electricity.

In the renewable energy sector, solar and wind power expect a slow growth rate. The biomass and biogas industry is gradually gaining importance, but at a low level. Legislation introduced in June 2014 restricts the subsidies available for renewables.

Italy produces biofuels in reasonable quantities. As stated in the GAIN Report ‘Italy – Biofuels Overview 2015’, compiled by the US Agricultural Service, Italy’s biodiesel production stood at about 2.5 million tonnes in 2015.

Biodiesel is produced mainly from imported rapeseed oil (40%), soybean oil (30%) and palm oil (25%). The small amount remaining is made from recycled vegetable oils, sunflower oil and vegetable fat.

Most of the rapeseed oil is imported from EU countries, while soybean oil is imported from the EU or made from imported beans. Palm oil is mainly obtained from Malaysia and Indonesia. Biodiesel is blended with standard diesel for transport use or for heating.

A few years ago, Italy seemed poised to jump on the renewable fuels bandwagon with determination, but fell back to seventh spot in the 2013 ranking of the largest biofuels producers in Europe (Figure 4). According to statistics from the European Biodiesel Board, it has regained momentum. Overall, European biofuel production grew strongly year-on-year between 2013 and 2014.


Demand for palm oil is projected to remain robust, especially from the food processing industry. After all, Italy is home to the world-famous hazelnut spread Nutella, in which palm oil is a key ingredient.

MPOC Brussels


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