Published on 26 Jun 2025

Malaysia looks to Kenya as palm oil hub for East Africa

Kenya is sub-Saharan Africa’s top importer of Malaysian palm oil

Malaysia sees potential for Kenya to become a processing and distribution hub for its palm oil exports to the East African region. This was communicated during a recent official visit to Nairobi by Malaysia’s minister of plantation and commodities, Datuk Seri Johari Abdul Ghani, who was accompanied by representatives from the country’s palm oil industry.

As part of efforts to strengthen its presence in the region, Malaysia will relocate its regional palm oil office from South Africa to Kenya. The new base in Nairobi is expected to make it easier for companies to access support services and resolve operational issues.

Kenya is already the leading importer of Malaysian palm oil in sub-Saharan Africa. Imports have more than doubled over the past five years, rising from 520,758 tonnes in 2020 to 1.26m tonnes in 2024. Palm oil accounts for over than 90% of Kenya’s edible oil consumption. Beyond household use, it is a key input for the country’s relatively developed manufacturing sector, where it is used in products ranging from margarine and baked goods to soaps and cosmetics.

Malaysia is also exploring opportunities in upstream palm oil cultivation in Kenya. With limited land remaining for large-scale plantations at home – and a policy against clearing forests for new estates – Malaysia is looking abroad to expand production. It has expressed interest in supporting Kenya’s domestic palm oil ambitions by providing high-quality seedlings, technical expertise and training. Although Kenya’s edible oil sector has a production capacity of 1.5m tonnes, it currently meets only 40% of local demand.

Recently, Kenya has ramped up efforts to attract foreign investments, particularly in energy, domestic manufacturing and sustainable transport. Tourism and agriculture also present significant investment opportunities. The country is a key trade gateway to the East African region. It offers access for re-exporting processed palm oil products to landlocked members of the East African Community – an economic bloc of over 300 million people – including Uganda, Rwanda, Burundi, the Democratic Republic of Congo and South Sudan. The Malaysian delegation said Malaysia is well positioned to help meet the region’s total annual demand of 3m to 4m tonnes.

The initiative forms part of Malaysia’s broader strategy to diversify its palm oil exports beyond traditional markets. Shipments to India, China and the EU – historically the top three destinations – have come under strain due to health-related concerns, regulatory constraints and competition from alternative vegetable oils. Between 2020 and 2024, combined exports to these markets fell from 7.4m to 5.7m tonnes, a 23% decline. Over the same period, exports to sub-Saharan Africa rose by 25%, highlighting the region’s growing importance. In the first quarter of 2025, Malaysia sent 1.7m tonnes of palm oil to sub-Saharan Africa, the Middle East and North Africa, and ASEAN markets (excluding Indonesia and Singapore) – more than double the 696,000 tonnes shipped to India, China and the EU combined. Beyond agriculture and manufacturing, Kenya’s fast-growing digital finance sector, green transport push, and Nairobi’s rise as a regional financial hub offer strong entry points for Singaporean investors, especially in fintech, capital markets, and infrastructure finance.