Palm Ingredients in Southeast Asia’s Ice Cream Market: Driving Growth, Performance & Innovation
As Southeast Asia’s ice cream market continues to expand, palm-based ingredients will play a defining role in shaping the sector’s competitiveness, resilience and capacity for innovationSoutheast Asia Ice Cream Market Size*
Figure 1: Ice cream market size in Southeast Asia (Indonesia, the Philippines, Thailand, Vietnam, Malaysia and Singapore) (Euromonitor, 2025).
Southeast Asia’s ice cream market was valued at an estimated USD7.8 billion in 2025 and is projected to expand at a compound annual growth rate (CAGR) of 3.1% between 2026 and 2030, reaching approximately USD9.4 billion by the end of the decade.
This steady growth is underpinned by rapid urbanisation, rising disposable incomes and year-round consumption, supported by the region’s tropical climate. As demand accelerates across both mass-market and premium segments, manufacturers are increasingly challenged by rising and volatile costs of key raw materials, particularly dairy fats and cocoa-derived ingredients.
Against this backdrop, palm oil and palm kernel oil have emerged as strategically important plant-based alternatives. Beyond cost competitiveness, these ingredients offer distinct functional and sensory advantages, enabling manufacturers to protect margins, enhance product performance and sustain innovation in an increasingly competitive market.
Urban Population (% of Total Population)—Thailand, the Philippines, Vietnam, Malaysia, Indonesia
Figure 2: Percentage of urban population in major Southeast Asian countries (World Bank, 2025).
Urbanisation Fuels Frozen Dessert Demand
Urbanisation remains a key structural driver of frozen dessert consumption across Southeast Asia. Over the past decade, Thailand recorded the fastest urban population growth among the major regional economies, with its urbanisation rate rising from 47% to 62%. This was followed by Vietnam, where urbanisation increased from 32% to 38% over the same period.
As of 2024, the urbanisation rate stood at 77% in Malaysia, 62% in Thailand, 59% in Indonesia, 55% in the Philippines and 38% in Vietnam. These figures highlight substantial headroom for further growth in the consumption of affordable and competitively priced ice cream and frozen desserts, particularly as modern retail penetration and cold-chain infrastructure continue to improve across the region.
Ice Cream Market Size* in Major Southeast Asian Countries
Figure 3: Ice cream market size in major Southeast Asian countries (Euromonitor, 2025).
Southeast Asia’s Ice Cream Market: Size, Shares and Growth Trajectories
Indonesia accounts for the largest share of regional consumption, representing nearly 40% of the Southeast Asian ice cream market, followed by the Philippines (20%), Thailand (16%), Malaysia (10%), Vietnam (9%) and Singapore (5%).
In growth terms, Vietnam is expected to be the fastest-expanding market over the next five years, with market size projected to increase by 68% between 2025 and 2030 (see Figure 3). Malaysia and the Philippines are forecast to grow by 29% and 26% respectively. By contrast, Indonesia and Singapore are expected to record more modest growth of 15% and 7%, while Thailand’s market is projected to remain broadly flat over the same period.
According to Euromonitor, Vietnam’s robust growth trajectory is driven by consistent demand across diverse demographic and socio-economic groups. This is reinforced by the country’s persistently hot and humid climate, which supports year-round consumption, alongside manufacturers’ proactive product innovation and portfolio expansion strategies.
In contrast, ice cream sales in Thailand are expected to stagnate between 2026 and 2030 amid a domestic economic slowdown. As household budgets come under pressure, consumers are likely to trade down to lower-priced alternatives, curbing discretionary spending on non-essential categories such as ice cream. This environment is expected to intensify competitive pressures and further elevate the importance of cost efficiency and product differentiation.
Value-Led Retail Models Reshaping Ice Cream Consumption
Another structural trend supporting regional market expansion is the rapid proliferation of Chinese ice cream and beverage chains across Southeast Asia. Brands such as Mixue, Bingcheng, Ai-Cha, Tiantian and WeDrink have expanded aggressively, establishing dense outlet networks across both urban and suburban areas.
By offering ice cream and frozen desserts at highly competitive price points, these chains are broadening consumer access and stimulating incremental demand, particularly among younger and more price-sensitive consumers.
Palm Oil’s Functional Edge in Ice Cream Formulation
Palm oil and its fractions play a complementary role in enhancing the structural stability and overall performance of ice cream products. Unlike many alternative vegetable oils, palm-based ingredients and emulsifiers possess physical characteristics that align closely with the technical requirements of ice cream manufacturing, particularly in warm climates, where product stability during storage and distribution is critical.
Palm kernel-based fats offer naturally stable fat profiles that support shelf-life performance while delivering consistent flavour and texture over time, without the need for excessive additives or intensive processing. Lauric fats exhibit superior oxidative stability and are less prone to rancidity than milk fat, contributing to extended shelf life and product consistency.
In addition, palm-based solutions help protect against flavour degradation and quality loss throughout the cold chain—an essential consideration for large-scale commercial distribution across Southeast Asia’s diverse and often challenging logistics environments.
Meeting Shifting Consumer Expectations with Palm-Based Solutions
Palm-based ingredients also align well with shifting consumer preferences across the region. Demand for plant-based and dairy-free options continues to rise in Southeast Asia’s urban centres, driven by younger consumers, increasing health awareness and a greater exposure to global food trends.
Palm-based fats enable the development of vegan and dairy-free ice cream formulations that deliver creaminess and mouthfeel comparable to conventional dairy products, without compromising sensory quality. Their neutral flavour profile further allows delicate flavour notes—such as subtle vanilla, fruit and floral infusions—to perform optimally, without interference or masking.
Sustaining Growth and Innovation Through Palm Ingredients
Looking ahead, the economics of ice cream production in Southeast Asia are unlikely to revert to a low-cost input environment, particularly given continued volatility in global dairy and cocoa markets. In this context, palm oil and palm kernel oil are set to remain central to formulation strategies—not only as cost-effective alternatives for dairy and cocoa fats, but also as performance-enhancing ingredients that improve melt resistance, oxidative stability and product longevity.
As Southeast Asia’s ice cream market continues to expand, palm-based ingredients will play a defining role in shaping the sector’s competitiveness, resilience and capacity for innovation.
*Note: Ice cream market size covers all categories and formats, including dairy, water-based and plant-based products, as well as impulse, take-home, bulk and multi-pack segments.