Oil Palm Industry Economic Journal Vol. 16 (1) March 2016 p. 1-7

Revealed Comparative Advantage and Competitiveness of Malaysian Palm Oil Exports against Indonesia in Five Major Markets

Kamalrudin Mohamed Salleh*; Ramli Abdullah*; M Ayatollah Khomeini Ab Rahman*; N Balu* and Ali Zulhusni Ali Nordin*
Received:    Accepted:    Available Online:


This study analysed the extent to which Malaysia had a comparative advantage over Indonesia in crude palm oil (CPO) and processed palm oil (PPO) exports to five major markets, namely, China, India, the European Union (EU), Pakistan and the USA. In addition, this study examined how Malaysia’s competitiveness and comparative advantage changed over the period 1999-2014 in major markets by adopting a widely used Revealed Comparative Advantage (RCA) index. The results suggest that Malaysia retained its comparative advantage in exporting CPO to Pakistan from 2009 to 2014 and started to gain comparative advantage in exporting CPO to India in 2014. Meanwhile, for PPO market, Malaysia sustained its comparative advantage in the USA along the study period, but gradually reduced comparative advantage onset 2012. In Pakistan, the study found that Malaysia started to lose comparative advantage for PPO to Indonesia in 2012 and 2014.

Keywords: trade, revealed comparative advantage, export competitiveness, palm oil, CPO, PPO, Malaysia, Indonesia, China, India, EU, Pakistan, USA

About Post Author

* Malaysian Palm Oil Board,
6 Persiaran Institusi,
Bandar Baru Bangi,
43000 Kajang, Selangor,

E-mail: kamalrudin@mpob.gov.my