NON-TRADITIONAL coconut products such as coconut water are expected to take over from oil as the industry’s main growth driver, the University of Asia and the Pacific (UA&P) said.
In its report, “The Coconut Industry: Local and Global Perspectives,” the UA&P said, “From the dominance of coconut oil as the main product for exports, the market profile has shifted into a multi-product industry with non-traditional coconut products gaining popularity especially with the growing concern for health and wellness.”
It noted that other products such as coconut water, milk, milk powder, and cream, have showed promise due to rising demand for organic products and those perceived as healthy.
It also noted that some consumer trends could favor the industry, such as health-consciousness, the ability to certify and trace products down to farm level, environmental awareness, and reduced plastic use.
The main new source of demand growth is coconut water, the UA&P said.
“Exports grew by 154% (year-on-year) by volume and 159%… by value over the past 10 years. Based on Philippine Statistics Authority (PSA) data, 2018 exports totaled 63 million liters of coconut water valued at $89 million to various parts of the world, with the United States as the biggest market,” UA&P said in a statement, adding that the product’s export potential.
It cited data from Technavio, a market research company, which estimated the coconut water market at 1.331 billion liters by 2021 from 536.9 million liters in 2016, with an annual growth rate of 26.75%.
Another non-traditional product with export potential is coconut milk, which has been taking on a new role as an alternative coffee creamer in the US for lactose-intolerant consumers.
Coconut milk powder is also gaining a market, growing 38% year-on-year by volume and 60% by value, with the Netherlands, Japan, US, France, and Australia as its biggest markets.
Exports of virgin coconut oil (VCO) were estimated at 193,000 tons in 2018. The report cited a market estimate of $780 million by 2025.
Desiccated coconut was among the Philippines’ top agricultural exports in 2018 at 145,100 tons worth $338.4 million. Top destinations were the US, the Netherlands, Australia, UK, and Canada. Exports are expected to grow 8.6% per year between 2019 and 2023.
The report said Philippine companies like Axelum Resources Corp. and Century Pacific Agricultural Ventures have been seeking to tap the international market.
Both supply coconut water to New York-based coconut water brand Vita Coco.
Axelum packs and sells coconut milk and exports desiccated coconut. — Vincent Mariel P. Galang