CO­CONUT OIL PRICES GO­ING UP WORLD­WIDE

THE IN­TER­EST IN SPE­CIALTY PROD­UCTS IS ONLY EX­PECTED TO GROW. Co­conut wa­ter and sugar make a splash, re­duc­ing sup­ply for use as in­gre­di­ents in less sexy prod­ucts

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Co­conut oil prices have soared nearly 20 per cent in a month, largely be­cause of the grow­ing pop­u­lar­ity of spe­cialty prod­ucts such as co­conut wa­ter. In su­per­mar­kets, co­conuts are be­ing sold with pull tabs to be drunk like beer. Co­conut sugar is be­ing touted as health­ier for di­a­bet­ics. And US ac­tress Gwyneth Pal­trow is among celebrity co­conut fans, once re­veal­ing she swishes around vir­gin co­conut oil for oral health and whiten­ing her teeth. More co­conut growers are har­vest­ing their fruit young for the wa­ter in­stead of al­low­ing them to ma­ture for co­conut oil, cre­at­ing a short­age in the oil mar­ket. Such trendy prod­ucts come from young green co­conuts, fresh co­conut and the trees’ flow­ers. That leaves less dried co­conut—co­pra—to be made into the con­ven­tional oil that is used in ev­ery­thing from dish de­ter­gent to medicine. The re­sult has been a jump in prices since Fe­bru­ary, to an av­er­age in March of US$1448 (FJ$3034.43) a met­ric ton, ac­cord­ing to World Bank data re­leased late Wed­nes­day. That is more than 50 per cent higher than the av­er­age price in 2013.

Mean­while, the in­ter­est in spe­cialty prod­ucts is only ex­pected to grow. Global con­sump­tion of co­conut wa­ter jumped 13 per cent from 2014 to 2015, fol­low­ing a 24 per cent in­crease the pre­vi­ous year, ac­cord­ing to data from bev­er­age re­search firm Canadean. The trend to­ward spe­cialty prod­ucts is be­ing felt through­out the co­conut in­dus­try, sug­gest­ing that prices for con­ven­tional oil aren’t likely to drop sig­nif­i­cantly in the near fu­ture, an­a­lysts say. Farm­ers in the Philip­pines, the world’s largest pro­ducer of co­conut oil, for ex­am­ple, are in­creas­ingly be­ing asked to har­vest younger co­conuts, as mid­dle­men chase af­ter the higher prices they net over fully ma­ture ones.

In the Philip­pines, co­conut-wa­ter ex­ports more than dou­bled to 66.3 mil­lion litres and vir­gin co­conut oil was up 61 per cent to 34,227 met­ric tons in the 11 months to Novem­ber 2015, ac­cord­ing to the lat­est avail­able data from the United Co­conut As­so­ci­a­tions of the Philip­pines. In the same pe­riod, co­pra and co­conut-oil ex­ports fell slightly, and the in­dus­try group pre­dicts they will drop 6.9 per cent to 2.1 mil­lion met­ric tons in 2016 from last year. “In­crease in cost of pro­duc­tion nar­rowed down mar­gins, and the in­dus­try play­ers nat­u­rally moved to­wards high-mar­gin [co­conut] prod­ucts,” said Maduka Per­era, owner of Cey­lon Tropics, a co­conut busi­ness in Sri Lanka. Mean­while, sup­plies will con­tinue to feel pres­sure.

Photo: Reuters

De­mand for spe­cialty co­conut prod­ucts like drinks and sugar has pushed up prices for ba­sic oil used in such things as dish de­ter­gent. Above, a worker runs be­hind a horse car­ry­ing co­conuts in

Septem­ber 2015 dur­ing har­vest time at a co­conut plan­ta­tion in Banyuwangi, In­done­sia’s East Java prov­ince.

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