Some of the blog's readers have known my work in the oleochemicals and industrial oils markets since 2000 when I first started as staff editor covering the oils, fats and waxes markets for Chemical Market Reporter (the predecessor of ICIS Chemical Business trade magazine).
I also previously posted a presentation that I did in 2005 predicting the growing influence of renewable-based chemicals in the overall chemical market and the increasing use of biotechnology in this industry. As I pointed out in the first slide of this presentation how the chemical industry started with using natural fats and oils for feedstock - think about soaps, varnishes, lubricants..In fact, Chemical Market Reporter first started in 1871 as Oil, Paint and Drug Reporter weekly journal and you can imagine how important natural oils-based chemicals trading were at that time!
The market for natural oils and fats-based chemicals shrinks to teeny-tiny markets as the era of petroleum and petrochemical refineries took place. However, when crude oil price started becoming too volatile and once it passed the $100 per barrel mark for the first time in history, many folks turn their attention back to alternative, natural-based feedstock. At the same time that the development of mega palm plantations in Malaysia and Indonesia boomed, the oleochemical industry has been finding itself building capacities after capacities in Southeast Asia (which unfortunately forced many Western producers to close shop and [or] shift into supply partnership instead).
Oleochemical capacity build-up continues in Asia but several Southeast Asian producers have also crossed oceans to set up shop in the West or even expand its portfolio into specialty oleochemicals (base oleochemicals produced are fatty acids, fatty alcohols, esters and glycerin). Here is a flowchart that I got from a Nexant report on oleochemical products coming from fats and oils: