Palm Oil Exports Skyrocket 675%: Key Driver of Nepal’s Export Growth in 2025

Nepal’s export sector saw an extraordinary boost in FY 2025/26 as palm oil exports surged by 675 percent, making it one of the fastest-growing export commodities of the year. Shipments reached Rs. 714.6 million in just one month, compared to only Rs. 92.1 million in the same period last year. Palm oil now contributes 3.0 percent of Nepal’s total exports, placing it among the top five export commodities.

The sharp rise reflects re-exports of imported crude palm oil refined in Nepal, largely destined for India due to tariff advantages under the South Asian Free Trade Agreement (SAFTA). This model has made palm oil a key driver of Nepal’s trade growth, similar to the dominance of soybean oil, which alone accounts for 44.7% of exports.

While this rapid growth is boosting foreign exchange earnings, it also highlights structural risks: the industry is highly dependent on policy incentives, regional trade rules, and India’s import demand. Any shifts in these factors could quickly reverse the trend. Nevertheless, palm oil exports have played a crucial role in lifting Nepal’s overall exports by 95.7 percent in FY 2025/26, making it a key growth engine alongside soybean oil.