Fatty Acid Market

Food & Feed Candle Various

2% 2% 5%
Personal Care
5% Soap &
Rubber Detergent
6% 30%

Paper
6%

Lubricant &
Grease
6%
Coating & Resin
6%
Intermediate
Plastic 18%
14%

Figure 1: Market sector for oleochemical fatty acid

Fatty acids have long been employed in many industries as both free acids, and more frequently
as salts. Figure shows the market sector of oleochemical fatty acid. According to Rupilius, the
top three industrial application of fatty acid is soap & detergent, intermediate and plastic. The
production of soap and detergents takes the highest percentage at 30%, followed by intermediate
products at 18% and plastic at 14%. Further applications include production of coating and resin,
lubricant and grease, paper, rubber, personal care, and other various products. The personal care
products and cosmetics segment is expected to record the fastest growth considering the constant
rise in the demand for fatty acid esters in creams and lotions.
Fatty Acid Supply & Demand

The major application of fatty acids and stearic acids are in the manufacturing of soap
and rubber products. However, even though the local soap, rubber and plastics manufacturing
industries are expanding rapidly, the demand for the products is met through import. Table 3.1
shows annual import of fatty acid and stearic acid during the period 2000 to 2011.
Export

The manufacturing of oleochemicals deals with a series of chemical reactions to

manufacture oleochemicals product like fatty acids and fatty alcohols with glycerin as by-product.
Fatty acid is the largest oleochemical products exported averaging at 33.6% of total oleochemical
export for the past five years. The export of fatty acid keeps increasing from 2011 at 0.81 million
tons to 2015 at 0.93 million tons. However, there is a slight decline in fatty acid exports in 2016
which is at 0.92 million tons. This lower export was due to lower demand from the largest
importing countries from EU, UA, India, China and Vietnam. The higher export of fatty acid
comparing to other oleochemical indicates the increasing in demand of fatty acid and is expected
to reach higher volume of export in the next five years.

1 0.93 0.92
0.91 0.91
0.86
0.81
0.8
Export (Million Tonnes)

0.6

0.4

0.2

0
2011 2012 2013 2014 2015 2016
Year

Figure 2: Malaysian export of fatty acid from 2011 to 2016 (Source: MPOB)
Production
Price