Palm sugar used in Pad Thai sauce is made by boiling collected sap. Producers tap the flower stalks or flower buds of palms and collect the sweet liquid that flows out. Depending on the region, the source may be a coconut, palmyra, date, nipa, or sugar palm.
The fresh sap is perishable, so it is heated soon after collection. Boiling removes water and concentrates the sugars until the liquid becomes a thick syrup. It may be sold in that form, or cooled into cakes, blocks, or granules. The finished sugar can range from golden brown to very dark brown.
Sap is not the same as juice, which usually refers to liquid pressed or extracted from fruit or plant tissue. Molasses is a by-product of refining sugarcane or sugar beet, while honey is made by bees. Those ingredients can sweeten sauces, but they are not what palm sugar is produced from.
In Pad Thai, palm sugar contributes a rounded caramel-like sweetness that balances salty fish sauce, sour tamarind, chili, and aromatics. Its texture and intensity vary by palm species and how far the sap is reduced.