PALMOILMAGAZINE, JAKARTA — Behind the steady growth of Indonesia’s palm oil exports to India lies a new and pressing demand: sustainability. Through the recognition of ISPO and cooperation frameworks such as the Indonesia Palm Oil Strategic Forum (IPOSF), Indonesia is seeking to ensure that palm oil trade is no longer defined solely by volume, but also by its role in advancing green and responsible commerce.
India remains one of the most critical markets for Indonesian palm oil. Chairman of the Indonesian Palm Oil Association (GAPKI), Eddy Martono, noted that although palm oil’s contribution to Indonesia’s total exports declined from 15% in 2021 to 10% in 2024, the trend rebounded in 2025, climbing back to 13%. The figures reaffirm palm oil’s strategic role in supporting the country’s trade balance.
However, Eddy also underscored mounting challenges on both the production and global market fronts. National output has stagnated at around 52–54 million tons over the past two years, while domestic consumption continues to rise. Notably, palm oil usage for energy—particularly biodiesel—has now surpassed its use for food.
On the demand side, India’s position is decisive. With annual vegetable oil consumption reaching approximately 25 million tons, the country cannot rely on domestic production alone. India produces only around 11.2 million tons, leaving a substantial supply gap that must be met through imports.
Out of total vegetable oil imports of 16.88 million tons, nearly 9 million tons consist of palm oil. Indonesia stands as the dominant supplier, exporting 4.4 million tons to India in 2024—well ahead of competitors such as Malaysia, Thailand, and Singapore.
Despite this strong foothold, export performance remains sensitive to India’s fluctuating import tariff policies and global price movements, both of which can directly affect demand stability.
As sustainability standards tighten and trade dynamics evolve, India’s role extends beyond that of a major buyer—it is increasingly a market that helps define the direction and standards of Indonesia’s palm oil exports. (P2)
