29/07/2025 (Indonesia Expact) - Palm oil is one of the world’s most widely used vegetable oils, found in everything from cooking oil and cosmetics to biodiesel and processed foods.

Its versatility and low cost of production have made it a cornerstone of global agriculture, but also a topic of environmental concern and sustainability debates.

As global demand continues to grow, understanding where palm oil comes from is key to addressing its economic and environmental impact. Here’s a look at the top 10 palm oil-producing countries in the world, based on the latest figures from the Food and Agriculture Organisation (FAO) and industry sources.

1. Indonesia

Annual Production: Over 45 million metric tonnes

Global Share: 58%

Indonesia is by far the largest producer of palm oil in the world. Its vast tropical landscape and favourable climate make it ideal for palm cultivation. The industry supports millions of jobs and significantly contributes to Indonesia’s economy. However, it also faces global scrutiny over deforestation and land use. In recent years, the government and producers have ramped up efforts toward sustainable certification (RSPO, ISPO) and traceability.

2. Malaysia

Annual Production: Around 18 million metric tonnes

Global Share: 25%

Malaysia is the second-largest producer and a pioneer in palm oil research and development. The country has a well-established infrastructure, with large plantations and a mature refining industry. Malaysia is also actively involved in promoting sustainable palm oil and was among the first to develop its own sustainability certification scheme, MSPO.

3. Thailand

Annual Production: 3–4 million metric tonnes

Global Share: 4%

Thailand has seen rapid growth in its palm oil industry. Most of its production comes from smallholder farmers, which presents both opportunities and challenges in implementing uniform sustainability practices. The country mainly produces for domestic use, with increasing exports to nearby Asian markets.

4. Colombia

Annual Production: 1.6 million metric tonnes

Colombia is Latin America’s largest palm oil producer and the fourth globally. The industry is expanding steadily, and the government has emphasised sustainability and rural development as part of its palm oil strategy. Colombian palm oil is often praised for being deforestation-free compared to Southeast Asian sources.

5. Nigeria

Annual Production: 1.4 million metric tonnes

Nigeria has a long history with oil palms, as the plant is indigenous to West Africa. Though it once led the world in production, its global share has diminished due to ageing plantations and limited investment. Nonetheless, palm oil remains vital for local consumption and smallholder livelihoods.

6. Guatemala

Annual Production: 900,000 metric tonnes

Guatemala is an emerging player with one of the highest yields per hectare globally. The country’s palm oil sector is export-oriented and has attracted attention from sustainability watchdogs due to concerns over water usage and land rights. Nevertheless, it is also part of RSPO initiatives and corporate sustainability programs.

7. Papua New Guinea

Annual Production: 600,000 metric tonnes

Palm oil is one of Papua New Guinea’s main export commodities. Much of the industry is linked to Malaysian and Indonesian investors. While the country’s remote geography poses logistical challenges, it has potential for growth and is involved in global certification efforts.

8. Honduras

Annual Production: 570,000 metric tonnes

Honduras has expanded its palm oil cultivation in recent decades, particularly along the northern coast. The industry plays a key role in rural employment. As in other Latin American countries, sustainability is a growing focus area, especially concerning land use and smallholder inclusion.

9. Ecuador

Annual Production: ~550,000 metric tonnes

Ecuador has a well-developed agribusiness sector and has positioned itself as a key palm oil producer in South America. Most of the production comes from the Amazon and coastal regions. Efforts are underway to align with international sustainability standards.

10. Ivory Coast

Annual Production: ~500,000 metric tonnes

As West Africa’s top palm oil producer, Côte d’Ivoire has a thriving domestic market and increasing export ambitions. The government has taken steps to boost yields and modernise the industry while working with NGOs to improve environmental practices.

The Future of Palm Oil: Balancing Growth with Responsibility

Palm oil production remains a powerful economic engine in tropical regions, providing employment and income for millions. However, its expansion has come with environmental costs—deforestation, biodiversity loss, and greenhouse gas emissions.

Leading producers, particularly Indonesia and Malaysia, are now under increasing pressure to implement transparent, sustainable practices. Certifications like RSPO (Roundtable on Sustainable Palm Oil), ISPO (Indonesian Sustainable Palm Oil), and MSPO (Malaysian Sustainable Palm Oil) are becoming standard across global supply chains.

As consumers and corporations demand greener choices, the palm oil industry is gradually evolving. The countries on this list play a crucial role in shaping that transformation.

Did You Know?

Indonesia’s palm oil industry employs more than 16 million people directly and indirectly, making it one of the country’s most vital economic sectors.

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