Palm oil is a common ingredient in foods and cosmetics, but it’s also one of the most controversial ingredients out there. While palm oil can be sustainable from specific sources, some people choose to avoid it just in case, while some people do not realize that some forms of palm out are actually okay.
If you want to use palm oil, as it has a unique color and flavor, make sure to find one that states ‘ethically sourced’ or ‘sustainable’ on its label. This indicates that it was harvested in an environmentally friendly way.
If you don’t want to use it, there are some other trustworthy substitutes for palm oil that can be used instead.
- Annatto oil
- Coconut Oil
Best All-Around Substitute For Palm Oil: Ghee
Ghee is the best all-around substitute for palm oil, and its flavor is quite similar to some of the buttery tones that palm oil has, though it is missing the earthy sweetness. It is also incredibly versatile – you can use it for baking, frying, roasting, and more!
The main difference between ghee and palm oil (aside from one being animal sourced and one plant sourced) is the color. Palm oil is usually a deep orange-red color, while ghee is typically pale yellow. Ghee has a higher smoke point than most other oils so it can be used for higher-temperature cooking.
You can do so in a 1:1 ratio when substituting palm oil with ghee.
Best Raw Cooking Substitute For Palm Oil: Annatto Oil
Annatto oil is a great vegan alternative to palm oil. It is made by soaking annatto seeds in a carrier oil like sunflower or safflower oil and has a mild, nutty flavor. It has the same color as palm oil, though less taste, and is suitable for raw cooking as it is liquid at room temperature, unlike palm oil.
Annatto oil has a lower smoke point than palm oil or ghee, as the seeds used to infuse the oil burn at temperatures around 300 degrees and can make the oil bitter, so even if you have used a high smoke point carrier oil, the seeds will reduce how high you can heat it.
Best Palm Oil Substitute for Regular and High Heat Cooking: Ghee
For regular cooking, you can use annatto for temperatures of up to 300 degrees, but with ghee, you don’t have to worry much about the temperature at all. Ghee has a smoke point of 480 degrees, making it suitable for regular and high-heat cooking. It also works well with most dishes, as its buttery and nutty flavor can go with sweet or savory things.
Palm Oil Substitute that is Closest in Flavor: Ghee
It is not easy to find an oil that tastes like palm oil. Some describe it as butter and nutty, some describe it as neutral and earthy, and some say it tastes like carrot or pumpkin. I assume it varies by brand, and the stronger red ones might have stronger earthy tones. The palm oils that I have tried taste nutty and buttery to me, meaning ghee is probably the closest in flavor.
Palm oil also has a rich texture, which I find ghee also to have, adding to the dish’s overall experience and richness.
Best Neutral-Flavored Palm Oil Substitute: Annatto Oil
If you want a neutral-flavored palm oil substitute, you could make one by making an annatto oil with fewer annatto seeds. That way, you would still get the wonderful red hue of the oil without the annatto seed taste (which is nutty, peppery, and floral).
Another substitute would be refined coconut oil, as it has a similar texture to palm oil but minus the flavor.
Best Budget-Friendly Palm Oil Substitute: Annatto Oil
Given that annatto oil’s primary ingredient is some kind of refined vegetable or seed oil, it is one of the most budget-friendly alternatives, provided you can get the seeds at a reasonable price! Walmart sells 2lb bags for around $27 at the time of writing.
Make sure to get the seeds, not the powder, to make the oil with. Then, use a small teaspoon of seeds for every tablespoon of oil (or less if you want the color and not much flavor), and heat them together to infuse before straining out the seeds.
Best Healthy Palm Oil Substitute: Coconut Oil
Coconut oil tastes nothing like palm oil, but if you are looking for a healthy alternative, it can work based on texture alone. Don’t like the taste? Go for refined coconut oil with less flavor (though that does also mean fewer nutrients).
Coconut oil is high in lauric acid and medium-chain triglycerides, which may help reduce cholesterol, and is also said to be antibacterial. Some studies suggest coconut oil may help reduce the risk of Alzheimer’s disease and other medical conditions.
Coconut oil is also the best substitute for palm oil in cosmetic use, such as making soaps and lotions. Its high concentration of fatty acids is effective at keeping skin hydrated and nourished. Coconut oil can be melted to a liquid consistency and used in recipes that require palm oil for added moisture. Use the same amount of coconut oil as palm oil to get the same results.
Best Keto/Paleo/Whole30 Palm Oil Substitute: Ghee
Ghee is the best alternative for these three diets based on taste, texture, and flavor. Some might be wondering if it is actually suitable for paleo and Whole30, as these diets do not allow dairy, but when ghee is made, the milk solids and water are removed, so it becomes a lactose-free product. If you don’t want to use ghee, coconut oil would be the next best thing.
Technically yes, but it is not a good substitute. While they come from the same plant, their flavor profiles are different. Palm oil is a much more robust, earthy, and nutty flavor, while palm kernel oil is mild and slightly nutty. Palm oil is much more colorful, while palm kernel oil is yellowish and pale. Palm oil is also higher in the nutrient beta carotene, which gives it its color.
Palm oil may be an ingredient in spreads like Nutella and many other processed supermarket sweets and chocolate. But it may not be listed on the label specifically, and the ingredients are often labeled as vegetable oils.
The Nutella label lists palm oil as the second ingredient after sugar. The position of an ingredient on the labels is an indicator of how much is in there. The earlier the ingredient is listed, the more the product is likely to contain compared to the later listed ingredients. So, there is probably quite a bit of palm oil in Nutella, and it probably is not sustainable.