China
United States
India
United Arab Emirates
Japan
MalaysiaPalm Fatty Acid Distillate prices showed surprising resilience in Q1 2025, gaining 4.8% despite typically weak post-holiday demand. Southeast Asia’s biodiesel blending mandates provided unexpected support, with prices peaking in early March before mild profit-taking emerged. The quarter highlighted PFAD’s dual role as a low-value byproduct and a vital biofuel feedstock, leading to occasional divergence from crude palm oil trends.
While inventories stayed elevated, strategic buying by biodiesel producers helped prevent deeper price declines. Market volatility reflected sensitivity to regional policy shifts, particularly Indonesia’s biodiesel program. PFAD closed Q1 2025 at USD 1,033/MT FOB Kelang.
Palm Fatty Acid Distillate (PFAD) prices in Q2 2025 continued their downward slide, declining 12.5% as weak biodiesel demand and abundant palm oil byproduct supplies weighed on the market. PFAD Prices bottomed at mid-June on limited restocking from oleochemical producers, but persistent oversupply from Indonesian biodiesel plants and reduced Chinese fatty acid sector buying kept sentiment bearish.
Malaysian production cuts offered slight relief, but the market remained fundamentally oversupplied with no sustained momentum for a strong rebound. By quarter-end, cautious buying provided a modest lift. According to PriceWatch, Palm Fatty acid Distillate prices closed Q2 2025 at USD 876/MT FOB Kelang.
Palm Fatty Acid Distillate started 2024 with moderate gains, rising 9.9% despite traditionally weak Q1 demand. Production discipline in Malaysia and Indonesia supported prices, which traded steadily within a narrow range as balanced inventories met stable biodiesel blending requirements. Early signs of PFAD’s growing role in renewable diesel production emerged, yet competition from abundant soybean oil byproducts kept prices contained. The quarter laid the groundwork for stronger performance later in the year, as biofuel policies increasingly favoured palm-based feedstocks. PFAD closed Q1 2024 at USD 795/MT FOB Kelang.
Palm Fatty Acid Distillate prices rebounded in Q2 2024, rising 12.3% as biodiesel demand strengthened and palm oil output entered a seasonal low. Consistent gains through May and June broke key resistance levels, reflecting improved buying from fatty acid producers and inventory restocking in major oleochemical hubs. The quarter signalled a turning point as PFAD began to partially decouple from crude palm oil price trends, reflecting its growing biofuel market value. Demand recovery in both biodiesel and oleochemical sectors added firmness to the market outlook. PFAD closed Q2 2024 at USD 827/MT FOB Kelang.
Palm Fatty Acid Distillate saw its strongest quarterly rally since 2022 in Q3 2024, with prices climbing 11.6% amid production shortfalls and robust biodiesel demand. Indonesia’s biodiesel blenders increased PFAD usage to meet renewable fuel targets, driving a late-quarter peak as tight availability of palm oil byproducts supported pricing. Strong crude palm oil futures further reinforced the uptrend, although volatility persisted due to shifting biofuel policies. The quarter underscored PFAD’s transformation from a low-value byproduct to a crucial biodiesel feedstock driving Southeast Asia’s renewable energy transition. PFAD closed Q3 2024 at USD 856/MT FOB Kelang.
Palm Fatty Acid Distillate prices surged 17.1% in Q4 2024, mirroring the rally in crude palm oil as Indonesia’s biodiesel program absorbed large volumes of byproducts. Early December saw a sharp rise in prices before seasonal factors and year-end profit-taking induced a correction. Biodiesel producers competed for limited distillate supply amid reduced Malaysian refinery operations, driving exceptional short-term tightness. The quarter highlighted PFAD’s increasing strategic role in the bioenergy market, though the late-quarter pullback reflected lingering concerns about long-term demand sustainability. PFAD closed Q4 2024 at USD 997/MT FOB Kelang.
Palm Fatty Acid Distillate (PFAD) pricing in Q1 2025 extended its downtrend, declining 14.2% as inventories rebuilt and biodiesel demand softened across major markets. Prices ranged from early highs in February to lower levels by March as reduced blending mandates in key countries curbed buying interest. Competitive pressure from alternative fatty acid distillates and weak import demand from China added further downside risk.
The quarter underscored PFAD’s strong correlation with biodiesel market sentiment while highlighting its sensitivity to regional policy shifts. Volatility persisted as traders adjusted to shifting feedstock economics and fluctuating biodiesel margins. PFAD closed Q1 2025 at USD 1,125/MT CIF Nhava Sheva.
Palm Fatty Acid Distillate (PFAD) prices in Q2 2025 remained under notable pressure, falling 13.7% quarter-on-quarter amid weak biodiesel demand in Europe and ample palm oil feedstock availability. Prices bottomed out in mid-June as oversupply persisted despite limited production cuts in Malaysia. Pre-monsoon restocking in India provided temporary support, but it was insufficient to offset market weakness driven by sluggish buying in key importing regions.
The quarter highlighted PFAD’s vulnerability to biodiesel policy adjustments and excess byproduct flows from Indonesian refineries. While late-June saw modest stabilization, the overall sentiment stayed bearish. According to PriceWatch, PFAD closed Q2 2025 at USD 969/MT CIF Nhava Sheva.
Palm Fatty Acid Distillate (PFAD) began 2024 with moderate gains, increasing 5.8% despite subdued post-holiday buying patterns. Production discipline in Malaysia and Indonesia provided key price support, while steady biodiesel blending activity absorbed available supply. Market sentiment improved as buyers anticipated tighter conditions later in the year, leading to gradual inventory restocking.
Prices showed relative stability compared to crude palm oil, indicating PFAD’s growing value as a biodiesel feedstock. This quarter effectively set the stage for a more bullish second half of 2024 as seasonal factors aligned with policy-driven demand. PFAD closed Q1 2024 at USD 820/MT CIF Nhava Sheva.
Palm Fatty Acid Distillate (PFAD) prices rebounded 15.1% in Q2 2024, supported by improving biodiesel margins and production concerns in Malaysia. The market shifted from contango to backwardation, reflecting tightening nearby supply and rising short-term demand. This structural change helped establish a higher trading range, with biodiesel blenders and oleochemical buyers rebuilding inventories.
Stronger regional demand, coupled with reduced availability from key refineries, reinforced the quarter’s upward trajectory. The performance laid the groundwork for a more sustained rally in the subsequent quarter as fundamentals strengthened. PFAD closed Q2 2024 at USD 938/MT CIF Nhava Sheva.
Palm Fatty Acid Distillate (PFAD) saw its strongest quarterly rally since 2022 in Q3 2024, rising 18.3% as Malaysian production shortfalls and robust biodiesel demand created temporary tightness. Prices breached key resistance levels, driven by strong refinery procurement and elevated biodiesel blending requirements in Indonesia. However, the rally began to lose momentum late in the quarter as price-sensitive markets reduced purchases, leading to mild demand destruction.
Despite this, PFAD maintained higher price floors than earlier in the year, signalling improved structural support. The quarter underscored PFAD’s evolving role as a key biodiesel feedstock. PFAD closed Q3 2024 at USD 888/MT CIF Nhava Sheva.
Palm Fatty Acid Distillate (PFAD) prices in Q4 2024 experienced sharp volatility, initially surging 22.5% on Malaysian biodiesel production disruptions and pre-winter stocking demand. Early December saw prices peak before a swift correction followed as anticipated demand failed to sustain the rally. The quarter emphasized PFAD’s increasing role in biodiesel supply chains while revealing the fragility of demand at elevated price levels.
Seasonal factors and profit-taking contributed to the late-quarter retreat, moderating gains despite tight availability earlier in the period. This highlighted the market’s inherent sensitivity to shifting biodiesel policies and refinery operational dynamics. PFAD closed Q4 2024 at USD 1,076/MT CIF Nhava Sheva.
Molecular Weight[g/mol]
CAS No
HS Code
Molecular Formula
Palm Fatty Acid Distillate (PFAD) is a by-product obtained during the refining of crude palm oil through physical refining. It appears as a brownish-yellow semi-solid or viscous liquid at room temperature with a characteristic fatty odour. PFAD is rich in free fatty acids—primarily palmitic and oleic acids—and contains residual triglycerides, moisture, and impurities. It is widely used in the production of soap, animal feed, oleochemicals (like stearic acid and glycerine), and as a feedstock in biodiesel manufacturing. Its high acidity, low cost, and availability make it a valuable input in various industrial applications.
Packaging Type
Grades Covered
Incoterms Used
Synonym
PriceWatch Quotation Terms:
Ex-Location: This incoterm refers to a shipping agreement where the seller makes the goods available at their premises, and the buyer is responsible for all transportation costs, including shipping, insurance, and any other fees.
CIF: CIF refers to the Cost, Insurance, and Freight (CIF) terms for goods. Under CIF terms, the seller is responsible for the cost of goods, insurance, and freight charges until the goods reach the port of destination.
FD: FD stands for Free Delivered where the seller takes full responsibility for delivering goods to the location/port. This ensures the buyer receives the goods at the designated port with all necessary costs, except import duties, covered.
FOB: FOB refers to the Free On-Board shipping term, where the seller is responsible for the cost and risk of delivering the goods to the port. Once the goods are on board the vessel, the responsibility shifts to the buyer for all costs, including shipping and insurance.
| Physical Property | Value (Palm Fatty Acid Distillate) |
| Physical state | Semi-solid to viscous liquid at room temperature |
| Colour | Yellow to brownish-yellow |
| Odour | Characteristic fatty odour |
| Melting point/freezing point | 45–55 °C |
| Boiling point or initial boiling point and range | >300 °C (decomposes before boiling) |
| Flammability | Non-flammable under normal handling conditions |
| Lower and upper explosion limit | Not applicable |
| Flash point | >220 °C (open cup) |
| Auto-ignition temperature | ~350 °C |
| pH (value) | Not applicable (non-aqueous) |
| Kinematic viscosity | 50–70 mm²/s at 40 °C |
| Dynamic viscosity | 45–60 mPa·s at 40 °C |
| Water solubility | Insoluble in water |
| Partition coefficient n-octanol/water (log value) | ~6.5–7.5 |
| Vapour pressure | Negligible at 20 °C |
| Density | 0.91–0.93 g/cm³ at 20 °C |
Applications
Palm Fatty Acid Distillate (PFAD) is extensively utilized across multiple industries due to its rich composition of free fatty acids and bioactive compounds. In the oleochemical sector, PFAD is a critical feedstock for the production of soaps, detergents, candles, and fatty acid derivatives such as stearic acid and oleic acid. In the animal feed industry, it is used as an energy-dense additive in livestock and poultry feed formulations. PFAD also plays a significant role in the biofuel industry, where it serves as a cost-effective raw material for biodiesel production. Its relatively high free fatty acid content, affordability, and renewable nature make it highly sought after for sustainable industrial applications.
Climate and Farming Impact (2024)
Erratic weather—including excessive rains and droughts—affected palm fruit development and oil extraction efficiency. The resulting lower crude palm oil output reduced PFAD byproduct volumes. Simultaneously, rising demand from industrial soap producers and oleochemical manufacturers intensified global competition. New environmental and traceability regulations, especially in Europe, caused export delays and further constrained PFAD availability, amplifying price pressures.
Feedstock & Logistic Disruptions (2023)
Adverse weather events in key Southeast Asian producing regions lowered palm oil yields, reducing feedstock availability for PFAD. Concurrently, port congestion, vessel shortages, and elevated freight rates created logistical hurdles. Volatile crude palm oil prices also impacted refining margins, resulting in irregular PFAD supply and heightened market fluctuations.
Russia-Ukraine War (2022)
The conflict disrupted global edible oil flows, especially sunflower oil, leading buyers to seek alternatives such as PFAD. Increased interest in PFAD for biofuel blending and soap production pushed global demand higher. Meanwhile, the war-induced surge in fertilizer and energy costs inflated production expenses throughout the palm oil value chain, contributing to elevated PFAD prices.
Post-COVID Demand Recovery (2021)
As economies reopened, demand for PFAD rebounded strongly, particularly in the soap, detergent, and animal feed sectors. Importing countries across Africa, South Asia, and the Middle East sought to replenish depleted inventories. However, lingering labour shortages in Malaysia and Indonesia hindered refinery throughput, creating tight supply conditions and driving PFAD prices upward.
The COVID-19 Pandemic (2020)
Global lockdowns and movement restrictions severely disrupted the palm oil industry, directly impacting PFAD production. Labor shortages, reduced refinery utilization, and logistical bottlenecks led to processing delays. With industrial demand from soap manufacturing, animal feed, and oleochemicals temporarily declining, surplus PFAD stocks accumulated. This resulted in significant price volatility and widespread market uncertainty.
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Molecular Weight[g/mol]
CAS No
HS Code
Molecular Formula
Palm Fatty Acid Distillate (PFAD) is a by-product obtained during the refining of crude palm oil through physical refining. It appears as a brownish-yellow semi-solid or viscous liquid at room temperature with a characteristic fatty odour. PFAD is rich in free fatty acids—primarily palmitic and oleic acids—and contains residual triglycerides, moisture, and impurities. It is widely used in the production of soap, animal feed, oleochemicals (like stearic acid and glycerine), and as a feedstock in biodiesel manufacturing. Its high acidity, low cost, and availability make it a valuable input in various industrial applications.
Packaging Type
Grades Covered
Incoterms Used
Synonym
PriceWatch Quotation Terms:
Ex-Location: This incoterm refers to a shipping agreement where the seller makes the goods available at their premises, and the buyer is responsible for all transportation costs, including shipping, insurance, and any other fees.
CIF: CIF refers to the Cost, Insurance, and Freight (CIF) terms for goods. Under CIF terms, the seller is responsible for the cost of goods, insurance, and freight charges until the goods reach the port of destination.
FD: FD stands for Free Delivered where the seller takes full responsibility for delivering goods to the location/port. This ensures the buyer receives the goods at the designated port with all necessary costs, except import duties, covered.
FOB: FOB refers to the Free On-Board shipping term, where the seller is responsible for the cost and risk of delivering the goods to the port. Once the goods are on board the vessel, the responsibility shifts to the buyer for all costs, including shipping and insurance.
| Physical Property | Value (Palm Fatty Acid Distillate) |
| Physical state | Semi-solid to viscous liquid at room temperature |
| Colour | Yellow to brownish-yellow |
| Odour | Characteristic fatty odour |
| Melting point/freezing point | 45–55 °C |
| Boiling point or initial boiling point and range | >300 °C (decomposes before boiling) |
| Flammability | Non-flammable under normal handling conditions |
| Lower and upper explosion limit | Not applicable |
| Flash point | >220 °C (open cup) |
| Auto-ignition temperature | ~350 °C |
| pH (value) | Not applicable (non-aqueous) |
| Kinematic viscosity | 50–70 mm²/s at 40 °C |
| Dynamic viscosity | 45–60 mPa·s at 40 °C |
| Water solubility | Insoluble in water |
| Partition coefficient n-octanol/water (log value) | ~6.5–7.5 |
| Vapour pressure | Negligible at 20 °C |
| Density | 0.91–0.93 g/cm³ at 20 °C |
Applications
Palm Fatty Acid Distillate (PFAD) is extensively utilized across multiple industries due to its rich composition of free fatty acids and bioactive compounds. In the oleochemical sector, PFAD is a critical feedstock for the production of soaps, detergents, candles, and fatty acid derivatives such as stearic acid and oleic acid. In the animal feed industry, it is used as an energy-dense additive in livestock and poultry feed formulations. PFAD also plays a significant role in the biofuel industry, where it serves as a cost-effective raw material for biodiesel production. Its relatively high free fatty acid content, affordability, and renewable nature make it highly sought after for sustainable industrial applications.
Palm Fatty Acid Distillate (PFAD) pricing is closely linked to crude palm oil (CPO) values, as it is a by-product of refining. Supply dynamics, including palm fruit harvest yields, refining throughput, and feedstock availability in Indonesia and Malaysia, heavily influence market trends. Demand from biodiesel producers, soap manufacturing, and animal feed sectors drives price stability or volatility. External factors such as monsoons, droughts, logistical bottlenecks, and currency fluctuations can create short-term swings. Moreover, renewable energy mandates, sustainability regulations, and shifts in trade policies, especially in the EU and major importing countries, significantly shape PFAD’s long-term pricing trajectory.
To negotiate favourable PFAD pricing, buyers should leverage real-time market intelligence on global supply-demand trends and biodiesel policy changes to strengthen their position. Entering long-term contracts during low-price cycles ensures stable costs and supply security. Diversifying sourcing across regions allows competitive comparisons while mitigating local disruptions. Building strong relationships with reliable suppliers enhances flexibility, priority access, and better terms during tight market conditions. Additionally, optimizing logistics through strategic shipping schedules and delivery modes helps reduce overall landed costs. A proactive approach, combining market knowledge with supplier collaboration, ensures more competitive and sustainable PFAD procurement agreements.
PFAD procurement faces risks like price volatility, driven by CPO values, global edible oil sentiment, and biodiesel policy changes. Mitigation involves hedging with futures or fixed contracts while closely monitoring price trends. Supply disruptions from weather anomalies, refinery shutdowns, or port congestion can cause delays, which can be reduced by diversifying suppliers geographically and maintaining safety stocks. Quality variability, including differences in FFA levels and impurities, risks downstream performance; thus, enforcing strict specifications, requesting Certificates of Analysis, and auditing suppliers is vital. Regulatory shifts and currency fluctuations affect landed costs, requiring trade monitoring and currency hedging. Proactive risk management ensures reliable and cost-effective PFAD sourcing.
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