Intraregional Export Flows and Export Efficiency in Palm Oil and Palm-Based Products: Southeast Asia and Latin America Regions Compared

Abstract

ABSTRACT Arguably, leveraging the intraregional market is important for a commodity like palm oil that constantly faces challenges to sustain global demand in extraregional markets. The article, therefore, compares intraregional export potentials for palm oil in two regions that are at the frontier for palm oil expansion, Southeast Asia and Latin America. The study employs a stochastic frontier gravity model to estimate intraregional export performance. The results indicate large untapped potentials and low-efficiency levels in both regions. The evidence further suggests that the export potential limiting factors have increased over time.