Palm Fatty Acid Distillate (PFAD) Market Size, Share, By Type (Refined, Crude, Oleic Acid Rich, Stearic Acid Rich, Palmitic Acid Rich, and Others), By Application (Animal Feed, Soap Manufacturing, Biodiesel Production, Lubricants, Food Additives, and Others), and By Region - Trends, Analysis and Forecast till 2034

Palm fatty acid distillate (PFAD) market size was valued at USD 1.37 Billion in 2024 and is expected to reach USD 4.02 Billion by 2034, growing at a CAGR of 12.6%.

PFAD is the by-product of the refining process of palm oil, which is separated during the physical refining of crude palm oil. Indeed, this is a very complex mixture of its various components, mainly free fatty acids, with the balance made up of triglycerides, partial glycerides, sterols, and tocopherols, among other minor compounds. PFAD usually results from the steam distillation of crude palm oil to remove free fatty acids and other impurities, resulting in a distillate rich in these components. The composition of PFAD may vary depending on the quality of crude palm oil and refining processes. Still, it generally contains 70-90% free fatty acids, while among the primary fatty acids are palmitic and oleic acid. Other FAs that may be part of PFAD include stearic, linoleic, and myristic acids. The high content of free FAs gives PFAD a relatively low pH and generally renders it an excellent raw material for many industrial uses. Small amounts are present of the valuable minor components of vitamin E, in its tocopherol and tocotrienol forms, in PFAD and phytosterols, adding to their nutritional and pharmaceutical value.

Due to the uniqueness of PFAD in composition and properties, different industries have started applying it. The oleochemical industry is an example of a niche where PFAD is fed as raw material for producing several kinds of fatty acids and alcohols and its other derivatives, which can find applications in personal care products, lubricants, plasticizers, and the like. Some of the latest consumers of PFAD as raw material are the soap and detergent industries that manufacture soaps and surfactants. Given its energetic content, PFAD could be used in animal feed to prepare animal diets. However, its application is controlled because it may have problems with quality and safety. PFAD has also become an exciting feedstock for the biofuels industry in recent years, especially for countries with significant palm oil production.

Despite the wide variety of applications of PFAD, controversy has ensued, most consistently regarding sustainability and environmental matters concerning palm oil production. The by-product of palm oil refining, PFAD, is seen by some sometimes as a more sustainable alternative to using refined palm oil in some uses. However, it still needs to be connected to the more general issues of palm oil growth: deforestation and habitat loss. Besides, since PFAD quality and safety heavily depend on the source and processing conditions, there have been several regulations and guidelines for its use in industries, especially regarding food and feed applications.

Over the last years, more detailed research has been carried out on optimizing the use of PFAD and researching new potential uses. Improvement in extraction techniques to release valuable minor components, the development of processes that would provide higher-value products from PFAD, and the possible use of PFAD in new areas such as lubricants and bioplastics are also taken into consideration. Indeed, with the advancement of the palm oil industry, thereby with pressure for a better sustainability role, the perception of PFAD might change, unlocking innovations and applications for this versatile byproduct.

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Key Drivers of Target Market:

Increasing Demand for Biofuels

• Demand for biofuels such as biodiesel is rising because of the growing importance of renewable energy sources worldwide. An essential raw material in the production of biodiesel is PFAD. This will gradually raise the demand for PFADs whenever biofuel demand increases.

Applications of PFAD in the Chemical Industry

• PFAD also serves as feedstock for producing various chemicals, such as fatty acids, alcohols, and surfactants. Development of the chemical industry, based on increasing populations and improving the standard of living across them, results in regular demand for PFAD.

Favorable Government Policies

• Various governments are implementing policies and offering incentives to increase the use of renewable feedstocks and reduce dependence on fossil fuels. These policies often include subsidies or tax breaks for producing and using biofuels that could raise demand for PFAD.

Restrains:

Price Volatility of Palm Oil

• Palm oil, the primary feedstock for PFAD, is a highly volatile commodity whose price can be determined by several key factors, including weather conditions, global demand, and governmental policies. In any given year, this volatility may make the profitability of both the producers and consumers of PFAD quite indeterminate.

Opportunities:

New Applications

• Developing new applications by research and development is underway for PFAD in the manufacture of biodegradable plastics, cosmetics, and pharmaceuticals. Any new usage discovered could expand the market range for PFAD and decrease its reliance on more conventional uses within biofuels and chemicals.

The market is segmented based on Type, Application, and Region.

Type Insights:

• Refined: It is refined to eliminate impurities, thus making it much purer than crude PFAD. It is mainly applied in fields where the product required has to be more stable and consistent, such as soap production or cosmetic industries that seek high-quality products. Refining will improve its usability in lowering free fatty acids, increasing its value for industrial uses.
• Crude: This is a by-product of the physical refining of palm oil. Because of the higher free fatty acid content, crude PFAD typically finds applications in lower-cost uses. The sectors where crude PFAD has been found to have applications are animal feeds and biodiesel production in industries where impurities do not adversely affect the product. Its lower cost makes it suitable for bulk industrial applications.
• Oleic Acid Rich: This type of PFAD contains highly monounsaturated fatty acid, oleic acid, for which markets are in demand, mainly because it has been described as a healthy and stable acid. The oleic acid-rich PFAD is an excellent raw material for producing high-grade lubricants, cosmetics, and specialty chemicals due to its unique fatty acid profile. Its particular fatty acid profile also makes it appropriate for applications in niche areas of food and pharmaceuticals.
• Stearic Acid Rich: The chemical composition of PFAD includes more of this saturated fatty acid, which is solid at room temperature. Applications include the manufacture of soaps, the processing of rubber, and the production of candles. Stearic acid maintains wax-like characteristics, hence making it an important ingredient in products that require firmness for stability.
• Palmitic Acid Rich: The palmitic acid-rich PFAD is a kind of PFAD that contains high levels of palmitic acid, a type of saturated fatty acid. Currently, it is widely used in food additives, detergents, and lubricants. It has a high melting point and good oxidative stability; hence, it is used in products that need durability due to various conditions.
• Others: This category encompasses PFAD with a mixed composition or uncommon types of fatty acids. These types of PFAD have applications in specialized markets, such as surfactants, bio-based chemicals, or research and development for new applications. This category is versatility depends upon the type of fatty acid profile within it.

Application Insights:

• Animal Feed: PFAD is normally used as an inexpensive energy source in animal feeding, particularly in ruminant feeding. Its high energy value makes it a very valued nutrient in animal feed, improving cattle growth rate and milk yield. The use of PFAD in animal feeding is of prime importance in countries with high agricultural biodiversity.
• Soap Manufacturing: Since PFAD contains fatty acids, it acts as a surfactant during soap manufacturing. PFAD aids in the saponification process, whereby it changes fat into soap and glycerin. The usage of PFAD in soap manufacture is universal but dominates price-sensitive markets, where PFAD finds application as an economic substitute for refined palm oil.
• Biodiesel Production: Due to the increased demand for renewable energy sources, PFAD has recently become very popular as a feedstock for biodiesel production. Since PFAD gives an appropriate fatty acid profile, it can be transformed into biodiesel through transesterification; thus, it keeps on contributing to the renewable energy sector. Biodiesel from PFAD is an environmentally friendly alternative to fossil fuels that would help reduce greenhouse gas emissions.
• Lubricants: The content of fatty acids in PFAD is a worthy chemical feedstock for producing bioderived lubricants. Biobased lubricants also represent an excellent option from an environmental point of view owing to their complete biodegradability and low environmental impact compared with petroleum-based lubricants. Applications of PFAD-based materials range from machinery to automotive industries, where sustainability has become increasingly important.
• Food Additives: PFAD has been applied industrially to foods, mainly due to its functionality as an emulsifier/stabilizer in processed foods. These aforementioned chemical compositions augment the rheological properties, increase the shelf life, and flavor foodstuffs such as margarine and bakery products. They find greater usage in areas with high demand in the food industry for palm oil derivatives.
• Others: Others include the use of PFAD in personal care products, cosmetics, and other unique uses of PFAD in oleochemical production. This covers new uses of PFAD, such as in bio-based chemicals and specialty ingredients. Its role in such industries varies depending on the end product's requirements.

Regional Insights

• North America: The North American region consumes PFAD in the main end-use applications, including biodiesel, lubricants, and food additives. As such, with the current growth in sustainability concerns and bio-based product demand across the region, industrial applications will drive the consumption of PFAD. Additionally, the region is witnessing a growing trend toward green energy solutions, which supports its use in biodiesel production.
• Asia Pacific: The Asia-Pacific region, especially countries like Malaysia and Indonesia, is the largest exporter and consumer of PFAD. As the region is dominant in palm oil production, PFAD is a readily available feedstock for various industries such as manufacturing soaps, animal feeds, and biodiesel. The extensive industrial base drives the demand for PFAD in the Asia-Pacific.
• Europe: The demand for biodiesel production, the robust implementation of environmental regulations, and the commitment of the European Union towards renewable energy sources make Europe a significant market for PFAD. These factors have, in turn, driven demand for the product in the cosmetic and personal care segment, with the availability of refined PFAD mainly used in high-end products.
• Latin America: Latin America is also an emergent market in PFAD because of the demand growth in biodiesel production and agriculture in this territory. Countries like Brazil and Argentina now strive toward renewable energy and agriculture; hence, these countries use PFAD in animal feed and biodiesel industries.
• Middle East and Africa: The Middle East and Africa form a more minor but developing market for PFAD, mainly in manufacturing soap and animal feed. The demand for PFAD has been propelled by industrial growth in the region and the easy availability of palm oil imports for various applications ranging from personal care to bio-based industries.

Palm Fatty Acid Distillate (PFAD) Market Report Scope:

Segments Covered in the Report:

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2024 to 2034. For the purpose of this study segmented the target market report based on Type, Application, and Region.

Segmentation:

By Type:

• Refined
• Crude
• Oleic Acid Rich
• Stearic Acid Rich
• Palmitic Acid Rich
• Others

By Application:

• Animal Feed
• Soap Manufacturing
• Biodiesel Production
• Lubricants
• Food Additives
• Others

By Region:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Russia
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • Israel
  • South Africa
  • Rest of Middle East & Africa

The key players operating the Palm Fatty Acid Distillate (PFAD) Market include Wilmar International Limited, Cargill, Inc., Bunge Limited, Sime Darby Plantation Berhad, Olam International Limited, Golden Agri-Resources Ltd., IOI Corporation Berhad, Musim Mas Holdings, Palm oil Refinery (M) Sdn Bhd, Kuala Lumpur Kepong Berhad (KLK), Apical Group Ltd., Sime Darby Oils, AustAsia Group, PT Astra Agro Lestari Tbk, PT Perusahaan Industri Ceres Tbk.

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• In July 2024, Wilmar International Limited announced the expansion of its PFAD production capacity in Indonesia. The expansion aims to increase production efficiency and meet the growing demand for sustainable biodiesel feedstocks. This move is part of Wilmar’s broader strategy to enhance its palm oil processing capabilities and support its sustainability goals.
• In June 2024, Cargill, Inc. launched a new line of PFAD-based bio-lubricants in Europe. The new products are designed to offer higher performance and lower environmental impact compared to traditional petroleum-based lubricants. This initiative is part of Cargill’s efforts to expand its portfolio of eco-friendly products and support the shift towards sustainable industrial solutions.
• In August 2024, Olam International Limited completed the acquisition of a palm oil refining facility in Malaysia. The acquisition enhances Olam's ability to produce and supply PFAD and other palm oil derivatives. This strategic move is intended to strengthen Olam’s position in the Southeast Asian market and align with its commitment to sustainable palm oil practices.

• Wilmar International Limited*
  • Company Overview
  • Product Portfolio
  • Key Highlights
  • Financial Performance
  • Business Strategies
• Cargill, Inc.
• Bunge Limited
• Sime Darby Plantation Berhad
• Olam International Limited
• Golden Agri-Resources Ltd.
• IOI Corporation Berhad
• Musim Mas Holdings
• Palm oil Refinery (M) Sdn Bhd
• Kuala Lumpur Kepong Berhad (KLK)
• Apical Group Ltd.
• Sime Darby Oils
• AustAsia Group
• PT Astra Agro Lestari Tbk
• PT Perusahaan Industri Ceres Tbk

“*” marked represents similar segmentation in other categories in the respective section.

Research Objective and Assumption

• Research Objectives
• Assumptions
• Abbreviations

Market Preview

• Report Description
  • Market Definition and Scope
• Executive Summary
  • Market Snippet, By Type
  • Market Snippet, By Application
  • Market Snippet, By Region
• Opportunity Map Analysis

Market Dynamics, Regulations, and Trends Analysis

• Market Dynamics
  • Drivers
  • Restraints
  • Market Opportunities
• Market Trends
• Product Launch
• Merger and Acquisitions
• Impact Analysis
• PEST Analysis
• Porter’s Analysis

Market Segmentation, By Type, Forecast Period up to 10 Years, (USD Bn)

• Overview
  • Market Value and Forecast (USD Bn), and Share Analysis (%), Forecast Period up to 10 Years
  • Y-o-Y Growth Analysis (%), Forecast Period up to 10 Years
  • Segment Trends
• Refined
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Crude
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Oleic Acid Rich
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Stearic Acid Rich
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Palmitic Acid Rich
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Others
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years

Market Segmentation, By Application, Forecast Period up to 10 Years, (USD Bn)

• Overview
  • Market Value and Forecast (USD Bn), and Share Analysis (%), Forecast Period up to 10 Years
  • Y-o-Y Growth Analysis (%), Forecast Period up to 10 Years
  • Segment Trends
• Animal Feed
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Soap Manufacturing
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Biodiesel Production
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Lubricants
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Food Additives
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years
• Others
  • Overview
  • Market Size and Forecast (USD Bn), and Y-o-Y Growth (%), Forecast Period up to 10 Years

Market Segmentation, By Region, Forecast Period up to 10 Years, (USD Bn)

• Overview
  • Market Value and Forecast (USD Bn), and Share Analysis (%), Forecast Period up to 10 Years
  • Y-o-Y Growth Analysis (%), Forecast Period up to 10 Years
  • Regional Trends
• North America
  • Market Size and Forecast (USD Bn), By Type, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Application, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Country, Forecast Period up to 10 Years
    • U.S
    • Canada
• Asia Pacific
  • Market Size and Forecast (USD Bn), By Type, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Application, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Country, Forecast Period up to 10 Years
    • India
    • Japan
    • South Korea
    • China
    • Rest of Asia Pacific
• Europe
  • Market Size and Forecast (USD Bn), By Type, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Application, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Country, Forecast Period up to 10 Years
    • UK
    • Germany
    • France
    • Russia
    • Italy
    • Rest of Europe
• Latin America
  • Market Size and Forecast (USD Bn), By Type, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Application, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Country, Forecast Period up to 10 Years
    • Brazil
    • Mexico
    • Rest of Latin America
• Middle East and Africa
  • Market Size and Forecast (USD Bn), By Type, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Application, Forecast Period up to 10 Years
  • Market Size and Forecast (USD Bn), By Country, Forecast Period up to 10 Years
    • GCC
    • Israel
    • South Africa
    • Rest of Middle East and Africa

Competitive Landscape

• Heat Map Analysis
• Company Profiles

• Wilmar International Limited
• Cargill, Inc.
• Bunge Limited
• Sime Darby Plantation Berhad
• Olam International Limited
• Golden Agri-Resources Ltd.
• IOI Corporation Berhad
• Musim Mas Holdings
• Palm oil Refinery (M) Sdn Bhd
• Kuala Lumpur Kepong Berhad (KLK)
• Apical Group Ltd.
• Sime Darby Oils
• AustAsia Group
• PT Astra Agro Lestari Tbk
• PT Perusahaan Industri Ceres Tbk

The Last Word

• Future Impact
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