Palm Oil in Cameroon: How Policy Shaped an Industry

Cameroon’s palm oil story is one of ambition, politics, and paradox. Despite being one of Africa’s largest producers of the commodity — the so-called “red gold” — the country often struggles with shortages, price spikes, and import dependence. At the heart of this contradiction lies policy: how successive governments have regulated, incentivized, or sometimes undermined the industry.

Palm oil in Cameroon is not merely an agricultural product; it is a political and economic tool, shaping the livelihoods of millions of smallholder farmers, the fortunes of large agro-industrial companies, and the government’s reputation in food security.

This article takes a deep dive into how policy has shaped Cameroon’s palm oil industry, drawing lessons for Africa’s broader agribusiness landscape.

Early Foundations: Colonial Legacy

The roots of Cameroon’s palm oil industry stretch back to the colonial period. Both German and later French and British administrators recognized the commercial value of oil palm. Colonial authorities promoted the establishment of plantations and trade routes, embedding palm oil into the fabric of Cameroon’s export economy.

This legacy lives on in the dominance of large agro-industrial players such as SOCAPALM (Société Camerounaise de Palmeraies), created in the 1960s with state backing and later privatized. These entities became central to the industry’s growth, benefiting from government concessions of land and infrastructure support.

Post-Independence State Control

After independence in 1960, Cameroon’s government doubled down on palm oil as a strategic commodity. Palm oil was seen not just as a food staple but also as an industrial input and a potential foreign exchange earner.

The state encouraged both parastatal companies and smallholder schemes, but policies heavily favored large-scale plantations. By the 1970s and 1980s, SOCAPALM, PAMOL (Plantations Pamol du Cameroun), and CDC (Cameroon Development Corporation) controlled vast estates.

Smallholders were encouraged to supply fresh fruit bunches, but the industry was largely top-down, with farmers dependent on large firms for processing and markets.

Structural Adjustment and Privatization

The 1990s marked a turning point. Economic crisis and pressure from the IMF and World Bank pushed Cameroon to privatize state-owned companies, including SOCAPALM.

This policy shift had mixed results:

• On one hand, private ownership brought in new capital, efficiency, and modernization.
• On the other, privatization deepened inequalities, as smallholders felt marginalized while large corporations expanded their dominance.

Critics argue that privatization reduced the government’s ability to directly steer the industry, leaving small-scale producers exposed to price volatility and market exploitation.

Recent Policy Dynamics: Shortages Amid Surplus Potential

Despite being Africa’s third-largest palm oil producer after Nigeria and Ghana, Cameroon faces recurring shortages. Domestic demand — fueled by population growth and the food processing industry — often outpaces supply.

The government has responded by:

• Restricting exports to ensure local availability.
• Authorizing imports, often from Asia, to fill the gap.
• Encouraging new investments in plantations to boost supply.

But these measures are double-edged. Export restrictions frustrate traders seeking higher global prices, while imports undermine local producers by flooding the market with cheaper oil.

Case Study: Import Dependence in a Producer Nation

In 2022, Cameroon imported over 80,000 tons of palm oil, mainly from Malaysia and Indonesia, despite having over 300,000 hectares of oil palm plantations. This paradox reflects the policy conundrum: balancing food security with trade ambition.

Local producers argue that the state’s import decisions depress local farmgate prices, discouraging investment in smallholder production. Meanwhile, consumers see imports as a lifeline to avoid inflation when shortages hit.

Smallholders vs. Industrial Giants

Policy has also shaped the power dynamics of Cameroon’s palm oil industry. Large agro-industrial companies — SOCAPALM, PAMOL, CDC — enjoy land concessions, infrastructure, and policy protection.

Smallholders, by contrast, often face:

• Limited access to improved seedlings and fertilizers.
• Poor road networks to transport fresh fruit bunches.
• Difficulty accessing credit or formal markets.

Government rhetoric frequently praises smallholders as the “backbone” of the industry, but in practice, policies have favored the big players.

Regulatory Push and Environmental Debates

Cameroon’s government also faces international pressure over environmental policies. Palm oil expansion is linked to deforestation, biodiversity loss, and land conflicts with local communities.

To address this, Cameroon has:

• Adopted sustainability guidelines aligned with global standards.
• Engaged with RSPO (Roundtable on Sustainable Palm Oil), though uptake remains limited.
• Launched national replanting programs to replace aging plantations.

Yet critics say enforcement is weak. Land disputes between communities and palm oil firms remain frequent, and environmental oversight is inconsistent.

Trust and Market Reputation

Just as in Nigeria and Ghana, adulteration and traceability issues plague Cameroon’s domestic markets. Informal sales dominate, and consumers often cannot distinguish pure oil from adulterated versions.

This undermines export credibility. International buyers demand traceability, but fragmented supply chains and weak regulation make this difficult to guarantee. As a result, Cameroon’s exports remain limited compared to its production capacity.

Looking Forward: Policy Opportunities

Cameroon stands at a crossroads. With demand for palm oil rising both domestically and internationally, the right policies could transform the sector into a powerhouse of inclusive growth. Key opportunities include:

• Smallholder Empowerment
  • Provide subsidies for seedlings, fertilizers, and training.
  • Improve rural roads and storage facilities.
  • Create cooperatives to strengthen bargaining power.
• Balanced Trade Policy
  • Encourage exports when surpluses exist, while ensuring local markets remain stable.
  • Limit imports to emergency measures only.
• Sustainability and Branding
  • Position Cameroonian palm oil as a sustainable, traceable, high-quality brand.
  • Tap into premium global markets where buyers pay more for certified oil.
• Innovation and Diversification
  • Invest in downstream industries: biofuels, cosmetics, pharmaceuticals.
  • Promote digital platforms for traceability and transparent pricing.

Conclusion: Policy as Destiny

Cameroon’s palm oil industry has been shaped by policy at every stage — from colonial plantation systems to post-independence state control, privatization reforms, and today’s balancing act between imports and exports.

The lesson is clear: palm oil in Cameroon is not just an agricultural sector but a policy-dependent industry. Without smart, inclusive, and sustainable regulation, Cameroon risks being a producer that paradoxically imports what it already grows in abundance.

But with the right policies — empowering smallholders, balancing trade, enforcing quality, and embracing sustainability — Cameroon could not only achieve self-sufficiency but also emerge as a continental leader in Africa’s palm oil boom.