Growing biodiesel demand curbs Colombia palm oil exports

First quarter exports from the world’s fourth largest palm oil producer – which produces almost 2M tonnes/year – fell despite an increase in both planted area and production, the USDA’s Foreign Agricultural Service (FAS) March report said.

The Colombian biodiesel blend rate has been increasing steadily since 2015 and is estimated at 12.5% in 2024, according to the Oilseeds: World Markets and Trade March 2025 report. Higher blending is supported by voluntary programmes allowing up to 20% biodiesel in cargo vehicles.

Exports as a percentage of production declined from over 40% in 2018/19 to a just over 20% in 2023/24, with destinations shifting, the report said.

An expansion of Colombia’s market share in Mexico was likely to be due to declining rapeseed oil imports from Canada, according to the report.

Colombia’s market share in the European Union (EU) declined due to declining palm oil consumption.

Meanwhile, Thailand’s palm oil exports had stabilised following a decade-long period of growth, the report said.

As the third largest palm oil producer behind Indonesia and Malaysia, Thailand accounts for 5% of global output, according to the report.

In the past decade, Thailand had increased palm oil production by 80% due to an expansion of planted area and its palm oil exports had risen twenty-fold to 800,000 tonnes, the USDA said.

Thailand’s exports of palm oil as a percentage of production grew to an average of 22% in the past five years, up from 8% in 2016-2020.

The increase in Thailand’s palm oil exports had been driven by increased demand from India, which had accounted for 80% of its shipments since 2017, the report said.

“Competitiveness of palm oil prices for export to India will be a key factor in Thailand’s palm oil export potential throughout 2025 as India looks towards lower-cost alternatives,” the USDA said.

Tags: India, Thailand, Malaysia, biodiesel, palm oil, shipments, consumption, exports, demand, Canada, Mexico, European Union, Colombia, Production