Palm oil alternatives: progress in food, soap and baking

Estimated reading time: 7 minutes

Palm oil hides in half of all packaged products you buy, from ice cream to lipstick to detergent. Yet its production clears rainforests faster than most crops and drives species toward extinction. You may feel stuck accepting this destruction as inevitable. Fortunately, scientists and entrepreneurs have now built alternatives that match palm oil’s chemistry, performance and versatility, without the ecocide.

These palm oil alternatives come from yeast, microalgae and improved plant breeding methods. Some reach commercial scale today, while others promise dramatic land use reductions tomorrow. While production is still tiny, scaling up could reduce forest destruction and supply chain risks. Read on to discover which substitutes work.

Why palm oil alternatives matter now

Palm oil dominates global vegetable oil markets for one simple reason – it is cheap. Yet the versatility touted by its industry lobbyists masks a brutal truth: palm oil is responsible for vast deforestation across Indonesia, Malaysia, Papua New Guinea and beyond.

Palm oil alternatives in food

The Dutch start-up NoPalm ferments rejected vegetables, potato peelings and sugar beets with oily yeasts. The process resembles brewing beer or making wine. However, instead of alcohol, the yeasts stockpile fat inside their cells. That fat becomes a direct stand-in for palm and other tropical oils in food, cosmetics and detergents.

NoPalm gives waste biomass a second life, since these residues would otherwise be destroyed or discarded. The company planned to produce 1,200 tonnes of yeast derived oil in 2026 at its demonstration facility. A commercial plant would aim for between 6,000 and 10,000 tonnes. Against global palm oil demand measured in tens of millions of tonnes, this is a beginning. Nevertheless, it is a beginning with a scaling path for palm oil alternatives in food.

Scientists from Nanyang Technological University in Singapore and the University of Malaya in Malaysia are pursuing a second route. Their team uncovered microalgae as a potential human food source. Their stated aim is to lessen the impact of palm oil on the food supply chain, and on the planet that food chain rests upon.

Palm oil alternatives in soap and cleaning products

Soap presents a harder problem than food. Manufacturers bake palm oil derivatives into surfactants, fatty alcohols and glycerin at industrial level to make cleaning products. Removing them means rebuilding formulas from scratch.

Levur tackles this directly. The Australian biotech company creates yeast fermented alternatives that replicate the texture and functionality of palm oil in processed snacks and soaps. Their lab grown fats dodge the deforestation and biodiversity loss that plantation oil carries as standard equipment.

C16 Biosciences works along similar lines. Founded in 2017, the company brews its oil from a wild yeast microbe through a fermentation process that produces no emissions. The entire process is agriculture free. Its farm is a lab in midtown Manhattan, and its oil is as natural as palm oil grown on fungi rather than trees.

Britain’s Clean Food Group adds a circular dimension. Their non-GM process grows natural yeast into palm oil derivatives for food and cosmetic formulations. In late 2024, the group announced a collaboration with THG Labs to produce a palm oil alternative made from waste bread for beauty and personal care products.

Palm oil alternatives in baking

Bakers lean hardest on palm oil’s semi solid behaviour at room temperature. Pastry, confectionery and chocolate fillings depend on fats that melt at precisely the right point. This is where Sun Bear Biofuture enters the story.

The start-up takes its name from the world’s smallest bear. Fewer than 1,000 sun bears remain, largely because of palm oil deforestation across their Southeast Asian forests. Founder and CEO Ben Wilding chose the name so that no one forgets what the technology exists to protect.

Sun Bear Biofuture feeds specially optimised yeast strains on food and agricultural side streams, including sugar processing residues from partners such as British Sugar. The yeasts naturally produce oils with a fatty acid profile similar to palm oil and cocoa butter. The company describes these as drop-in fats, matching palm oil’s functionality without driving deforestation. Bakery, confectionery and cosmetics form their first targets.

Their engineering costs deserve mention too. A typical precision fermentation pilot demands between £350,000 and £1 million. Sun Bear Biofuture built its automated pilot plant for around £25,000 by repurposing standard brewing and dairy tanks, with the main fermentation vessel costing under £1,000. The plant already produces dozens of kilograms of yeast derived oil monthly. Melior Oil, their first product, launched at SCS Formulate in late 2025 with distributor OQEMA Group. Commercial industrial supply is targeted from late 2026 onward. The company states its oils could cut land use and emissions by up to 90% compared to conventional vegetable oils.

The limits of scale and endless growth capitalism

Scale and funding remains a massive limitation, but with time and seed investment this could be overcome. Palm oil saturates the planet because it is cheap. But remember there were thousands of years where palm oil was not used as a staple food ingredient. Yet the world did not collapse due to a lack of it!

It is naive to think that technology alone will end ecocide. We urgently need a radical rethink of the underlying system of endless growth capitalism that is the machinery driving palm oil, meat, dair, mining, fossil fuels and other destructive industries.

The FMCG industry will continue to burn forest and peat for palm oil and meat so long as governments remain lax on regulation. Stricter regulation is needed before there is no rainforests left to plunder at all. Meanwhile empowering consumers with knowledge about the provenance of their food is the way forward. That is why a palm oil boycott remains critical.

Take Action!

Behave like a force-multiplying yeast or algal extract and use your wallet as a weapon. #BoycottPalmOil #Boycott4Wildlife every time you shop.

Further information

GlobalData Strategic Intelligence. (2025, December 3). Why microbial oils could mitigate deforestation from palm oil. Just-Food. https://www.just-food.com/analyst-comment/why-microbial-oils-could-mitigate-deforestation-from-palm-oil/

Palm Oil Detectives. (2022, September 11). Reasons to hope: Palm oil alternatives without deforestation. Palm Oil Detectives. https://palmoildetectives.com/2022/09/11/reasons-to-hope-palm-oil-alternatives-made-without-deforestation/

ENDS

---

Read more about deforestation and ecocide in the palm oil industry