Vegetable oils have been the main source of minerals and nutrients for thousands of years and in different cultures. In ancient history, vegetable oils were produced in various regions for a variety of culinary purposes and today, vegetable oils are used in almost every industry.

Looking back and between 2011-2018, the vegetable oil market has been growing at a cumulative average growth rate (CAGR) of 4% with consumption volumes reaching over 200 million tons in 2018.

As the name may imply, vegetable oils are extracted from the seeds, fruits, and leaves of vegetables which appear to be liquid under room temperature and edible in almost all cases except for essential oils which are highly potent and require excessive caution even to use externally.

Apart from edible vegetable oils, non-food application of vegetable oils is highly useful in the production of candles, soaps, lubricants, and even biofuels. With a wide array of uses, the vegetable oil market has been growing at a pace that analysts have been able to conclude as “healthy.”

The rise in popularity of vegetable oils can be attributed to the ability to obtain the oils in organic and healthy options which is the mainstream preference in recent years. As technology and science evolve, so as healthier methods to obtain vegetable oils in a way consumers can enjoy almost all benefits vegetable oils can offer.

Other factors pushing the vegetable market towards an upward trend may include the change in eating habits, improvement in living standards especially in developing economies, population growth, and the increased awareness of the health benefits of vegetable oils.

The list for vegetable oils can be endless, but the most popular by choice and in terms of health benefits are olive oils, coconut oil, Soybean oil, peanut oil, corn oil, canola oil and just to name a few. Vegetable oils can be refined and produced with the use of chemicals to enhance production and can also be produced organically to obtain the oil in healthier forms suitable for a healthier lifestyle.

Vegetable Oils and Regions of productions

Tropical crops are the most used in the production of healthy vegetable oils and different regions grow different crops and make certain regions “masters” in the production of specific vegetable oils.

According to popularity and market dominance,
palm oil, a widely produced tropical oil, contributes over one-third of the global vegetable oil supply with global consumption of over 41.30 million tons. Palm oil is mostly used for cooking and the production of cosmetics. The oil is also used in the production of biofuel. The main producers of palm oil include Malaysia, Indonesia, and Papua New Guinea.

It is also very important to note that the palm oil industry is facing serious allegations towards deforestation claims for the cultivation of palm. Major adjustments and sustainability measures are currently being put in place in the industry.

The second in line is Soybean oil, mostly used in the food industry and as a cooking oil with global consumption of over 41.20 million tons. Soybean oil is considered one of the top healthy vegetable oils which is indicated on the global consumption level. Top exporters of soybean oil may include Argentina, the United States, and Brazil.

Rapeseed oil with its fractions (Canola oil), is a very popular vegetable oil with over 18 million tons in global consumption. It is also a widely used cooking oil with great health benefits. The top exporters of Rapeseed oil as of 2020 are Canada, Germany, and Russia.

Sunflower oil is also a well-known vegetable cooking oil with recent use in the production of biodiesel with a global consumption level of 9.91 million tons. The top exporters of sunflower oil are Russia, Turkey, and Ukraine.

Peanut oil is another widely used vegetable oil with global consumption of over 4.8 million tons. The top global exporters of peanut oil are Argentina, Brazil, and Sudan.

Cottonseed oil is another popular vegetable oil in the food production industry with a global consumption of 4.99 million tons. The top producing countries are India, Mexico, and Spain.

Coconut oil is another popular and widely used vegetable oil for its outstanding health benefits. Coconut oil is used in the food industry, cosmetics, and soaps with global consumption of over 3.4 million tons. Top producers of coconut oil include Indonesia, the Netherlands, and the Philippines.

With Olive oil, it is widely accepted for its health benefits. Global consumption is over 2.8 million tons and is widely used in cooking, cosmetics, and the production of soaps. Olive oil stands out as one of the most pricey vegetable oils in the market. The top exporters of olive oil are Spain, Italy, and Tunisia.

Above all, Indonesia stands out as the largest exporter of vegetable oil in the world, producing over one-fifth of the world’s vegetable oil. China comes in second followed by Malaysia. The European Union is also producing a huge variety of vegetable oils and is considered the 4th highest region in global production of vegetable oil.

Application of Vegetable oil.

Vegetable oils are being widely used in a wide variety of industries. These include the food industry, pharmaceuticals, cosmetics, and growing rapidly, the biofuel industry. Looking at consumption, the food industry stands to consume the majority of vegetable oil produced globally. Vegetable oil is also widely used for industrial applications and followed by the biofuel industry in terms of consumption.

Use of vegetable oil in the food industry

For the food industry, understanding the role vegetable oil plays in our health, goes a long way to explain why the food industry consumes the highest amount of vegetable oil. In Europe, there have been projects and government promotional programs sensitizing the health benefits of vegetable oils. Vegetable oils are used in the food industry for frying, cooking, salad dressing, and also in the manufacturing of snacks for flavoring and also for reservation. The top vegetable oils used in the food industry are palm oil, soybean oil, sunflower oil, canola oil, olive oil, and coconut oil

Vegetable oil for the cosmetic industry

In the cosmetic industry, vegetable oils are widely used for the production of personal care products. These products may include soaps, skin lotions, cleansing products, make-ups, powders, tanning products, and even personal hygiene products. Vegetable oils are also used as a carrier oil for other highly potent essential oils.

One of the most important reasons why vegetable oils are used for cosmetics apart from the presence of beneficial antibiotic properties is the ability for vegetable oils to prevent the loss of water from the skin. When vegetable oils are applied to the skin, it forms a barrier on the skin surface and limits the loss of water through the skin. Palm oil, castor oil, coconut oil, and olive oil are some of the top vegetable oils used in the cosmetic industry.

Vegetable oil and the pharmaceutical industry

Vegetable oils are known to be unique for their application in the chemical industry. In the organic or “green” chemistry category, vegetable oils are highly significant and used as raw materials, solvents, derived solvents, cosolvents, and reactants. The pharmaceutical industry turns to use vegetable oils as they are widely available and affordable compared to other alternatives. Besides, vegetable oils are well known for their nontoxic properties and are a safer option for research and industrial purposes. Using vegetable oil as a solvent is also getting popular and widely used to extract natural medicinal substances like carotenoids and phenolics. Also, they are used in the formulation of medicinal delivery systems and also biopolymers.

Vegetable oils and Biofuel.

With the world’s focus towards a green earth, vegetable oils are now being introduced in the fuel industry to reduce the level of carbon emission. Vegetable oils are used for the production of biofuel, through transesterification an effective method which converts the vegetable oil into biodiesel also known as “green diesel.” The most used vegetable oil for biofuel is palm oil.

Vegetable Oils and Compliance in the European Market.

The legislative requirements for vegetable oils basically emphasized food safety and quality control. However, labeling and packing requirements are of prime importance in the EU market especially for vegetable oils coming into the EU markets in forms ready to consume. For niche consumptions, the presence of organic and fair trade programs has made certifications available to measure certain aspects in various category segments.

Legal requirements for Importing Vegetable Oils in the European Market.

Before importing vegetable oils in the EU region, there are certain requirements that must be met before the finished products can make their way into the European market. As mentioned earlier quality control, hygiene, and traceability are of prime importance. Also, the avoidance of contamination, the fat and Erucic acid content, extraction solvents, the composition of the product, and the use of genetically modified organisms are highly considered according to certain levels.

Quality Control, Hygiene, and Traceability.

Food safety concerns are placed at the highest level when it comes to the requirements to import food products in the EU market. Before any food product can be marketed in the EU region it must meet the General Food Laws of the EU region.

The General Food Laws encompasses traceability requirements which make provision for the food to be tracked throughout the production stages. Importers must expect to know more about their suppliers, products used during the production process and should be able to label the finished products for traceability for food safety concerns

In other to achieve these quality controls, there are food management principles with defined critical control points to adhere with and if neglected, products will not be allowed into the EU region. Before importing vegetable oils into the EU it is important to make sure the origin country has not been blacklisted or continuously failed to meet European import legislations.

With countries indicating repeated non-compliance, more strict conditions may apply and exporters are sometimes required to present health certificates with analytical test reports. Here is a list and conditions which may apply.

Avoidance of Contamination

Every market including the EU region is keen on contamination to ensure food safety. It is common for a product to be contaminated during processing, storage, poor packaging, and during transportation. According to the different contamination levels, there is a certain maximum level that can be accepted.

Some contaminants can include; Aflatoxins, PAHs (Polycyclic aromatic hydrocarbons), microbes, heavy metals, pesticides, and foreign matter.

The Content of Erucic Acid in the Vegetable Oil

There exist a lot of controversy regarding the effects of erucic acid on human health. When importing vegetable oil in the EU region, it is important to pay attention to the maximum level of erucic acid which is at a 5% of the overall level of fatty acids in the fat components of the vegetable oil. It is important to request the appropriate documents which may indicate the fatty acid composition of the vegetable oil.

The Level of Extraction Solvents

Solvents are usually used in the production process to extract refined vegetable oils. Hexane is a solvent that is highly used in the production of vegetable oils. It is important to note that the residue for extraction solvents should not exceed the maximum limits.

For solvents like Ethylmethylketone, a 5mg per kg is required and for hexane, 1 mg per kg for both production and fractionation of the vegetable oil. There are certain solvents that are prohibited entirely. Such solvents can be checked here.

Composition of the Vegetable Oil

The vegetable oil must be free from prohibited additives and also a high content level for foreign materials can cause the oil to be rejected by the EU customs. Every substance found in the oil must be declared on the label and anything other than what was declared can cause the oil to be rejected. There are legislations that must be looked at here concerning additives and enzymes.

Since the vegetable oil is to be sold in the EU markets, certain criteria for quality and purity must be applied. These criteria must describe the physical and chemical characteristics of the vegetable oil on the label and also on the certificate of analysis.

The Use of Genetically Modified Organisms (GMOs)

There is a huge concern about using genetically modified organisms in the production of food products including vegetable oils to be marketed in the EU region. Due to food safety and environmental impacts, the use of GMOs is a sensitive issue. Oils produced from genetically modified oilseeds and other raw materials are highly restricted.

Also, European consumers on their part are rejecting the use of GMOs in the production of food products to be consumed in Europe. Before importing vegetable oils in the EU, make sure the supplier’s production process is well documented to indicate no GMOs were used in the process of obtaining the vegetable oil. Also, as you avoid markets with penalized products or banned by EU legislation.

Other Key Requirments.

Labeling of the Vegetable Oil

It is important to note that there are labeling legislations to adhere to when importing vegetable oils in the EU. This is in situations the oils are pre-packed and ready for consumption. The labels must be able to indicate the composition of the oil, allergens, the manufacturer, best storage methods, expiry dates, and the preparation of the oil.

With refined vegetable oils, there exist certain mandatory indications which must be present on the label. It is mandatory to indicate the country of origin of the vegetable oil. If the oil is hydrogenated, it must be indicated as “fully hydrogenated” or “partly hydrogenated” depending on the state of the vegetable oil. In a situation where the oil was extracted in another country different from the origin of harvest, it must be stated.

The Presence of Allergens

When vegetable oils are pre-packed, ready for consumption, and contain allergens, the label must indicate the presence of such allergens. The indicated statement must be clearly visible to the consumers. For example, peanuts in peanut oil, soy which is present in soybean oil.

These allergens must be indicated in the list of ingredients. It is also important to note that these indications are also applicable for non pre-packed vegetable oils. Read more on the guidelines with allergens here.

Health and Nutritional Claims.

Before any health and nutritional claims can be indicated on the label, they must be backed by scientific evidence approved in the EU region. Such claims are not supposed to mislead the consumers in any way and must be approved by the European Food Safety Agency (EFSA).

Novel Foods

Novel foods can be considered as foods with a less significant consumption within the EU region before the 15th of May 1997. Novel foods may include newly developed products by the industry even if it falls under the category of natural foodstuffs. An example of vegetable oils recently approved to circulate in the EU region are chia seed oil and sacha inchi oil.

Other novel food condiments that have not been approved to circulate in the European market will be rejected with a “no-go” status. With this indication, such products can’t be sold in the EU region. An example can be seen with Nangia nuts which were rejected in the EU region in 2021.

Food Contact Materials.

It is very important to pay attention to the materials that get in contact with the vegetable oil. This may include packaging and storing materials. It is important to make sure these materials don’t pose any threat to human health, alter the composition of the vegetable oil in a way that it can’t be consumed, and also destroy or deteriorate its taste and odor. Below are some restricted substances;

• Heavy metals
• BFDGE
• NOGE
• N-nitrosatable BADGE
• Vinyl chloride monomer N-nitrosamines

Also, it is important to pay attention to Bisphenol A as it is currently being rejected due to recent concerns. Bisphenol A (BPA) is widely used in the production of plastic bottles.

If you are looking to import vegetable oils, only use packaging materials that have been approved by the European legislation. This legislation applies to all food products. You may request documentation on toxicology, and a declaration of non-migration of chemicals from food contact materials from your supplier.

Certifications

When importing vegetable oils into the EU market, it is important to import from sellers with recognized food safety certifications or management systems. With these certifications comes a certain level of guarantee, consistent quality, and safety. When it comes to vegetable oils, the most recognized and required food safety certifications are the ISO 22000, FSSC22000, and International Food Standards (IFS). It is also important to familiarise yourself with management systems that are approved by the Global Food Safety Initiative (GFSI)

Corporate Responsibilities.

With growing concerns about environmental and social impacts, European importers are required to comply with certain codes of conduct in line with corporate responsibilities. This is usually common with large-scale importers with long-term contracts.

Exporters may be forced to comply with certain standards to secure huge contracts. Such standards may include labor, environmental, and business ethic standards. A good example can be seen with the sustainable palm oil production which promotes the “green earth requirements.” For environmental issues, importers may request certifications like ISO 14000.

With sustainable sourcing certifications, importers can be rest assured the raw materials involved in the production of the final product were secured in a sustainable manner. Deforestation concerns have been a major concern for the production of palm oil and soybean oil recently. Major outlets in Europe may not carry products that were not produced with sustainable considerations. Industry players like Unilever, Nestle, have been able to promote the RSPO (Roundtable on Sustainable Palm Oil) and RTRS (Roundtable on Responsible Soy) initiatives which ensure sustainable production and trade globally.

Requirements for Organic Vegetable Oils

The process to import organic vegetable oil and the regulations and testing that ensures the organic nature of vegetable oils has become more strict in the EU region. There has been an increase in the demand for organic vegetable oils and so as organic certifications. The shift in organic demand can be attributed to the health and wellness trends in Europe.

In other to be organically certified, importers must comply with the European regulations for organic production of vegetable oils. Before the European Union’s organic logo can be affixed on the label of the vegetable oil, it must be certified by one of the organic authorities in the EU region. For example Naturland in Germany.

The organic testing ensures that no genetically modified organisms or other chemicals were used during the production process of the vegetable oil. The vegetable oil must be free from pesticides, chemical fertilizers, and any contaminants. The oil can only be certified after it is authenticated by an EU organic organization. For more information, you can consult the International Federation of Organic Agriculture Movements for the required standards here.

Requirements for Customs and Clearance

Customs clearance and procedures may include the payment of EU tariffs, complying with the rules of origin, the payment of taxes, and meeting all the product requirements. It is very important to pay attention to the customs requirements and procedures as this can help ease the clearing process.

Documents required for Customs Clearance

The documents that may be required for customs clearance when importing vegetable oils may include;

The commercial invoice which indicates the parties involved in the export and import of the vegetable oil. The commercial invoice must include the description and cost of the product for customs purposes.

Customs Value Declaration; A customs value declaration is a document importers need to submit to the customs for goods worth above EUR20,000.

Customs Import Declaration; This is also known as the Single Administration Document (SAD) which is required to declare the goods at the respective customs authorities or destination port. The SAD is filed alongside the customs value declaration.

A proof of Origin; A proof of origin is required to declare the origin of the product. This can help the customs identify the origin status of the product or if the importer can benefit from a certificate of preferential origin.

Entry Summary Declaration (ENS); When importing into the EU it is required to declare in advance a summary of the shipment at least 24 hours before loading at the port of discharge. Customs should be aware of the shipment before it departs in other to run a risk analysis for safety and for security purposes.

Obtaining an EORI number; The Economic Operator Registration and Identification (EORI) is required for customs purposes and as an importer identifier.

Transport Documents

Transportation means are always represented with a transport document to record the entry of the products at the port of entry. Goods are mostly transported by air, land, or by sea. By sea, a bill of lading is required, by land a road waybill and rail waybill, and also an airway bill for air transport. A FIATA bill of lading can be required for multimodal and combined transport.

Other transport documents may include ATA (temporary admission) from the chamber of commerce, a TIR carnet for transits by road, freight insurance, and a packing list.

Tariff Requirements

The EU law R220/99 requires the ERGA OMNES which is also known as the “third country duty.” For a quick example, a 12.80% is applicable for the importation of virgin coconut oil. This duty can differ amongst different vegetable oils and countries of origin. It is also important to understand that tariffs can change without any prior notice. It is important to always stay updated with tariffs and duties.

However, countries with trade agreements with the EU can benefit from zero preferential tariff benefits. The generalized tariff preference (GSP) scheme is a good example that is applicable for some countries and for the importation of agricultural products.

Taxes

For vegetable oils entering the EU region, there is a 7% value-added tax.

The Normal Clearing Process.

With vegetable oils and every other goods entering the EU region, the products are placed under a customs supervision period of not more than 90 days. During this period, the products will go through customs verification, and clearance to make sure the products meet all the import requirements including the payment of all tariffs and taxes. Once approved, the products will be released for free circulation.