The country’s coconut oil (CNO) exports dropped by almost a third in September due to a lack of raw material and weak demand from traditional buyers, an industry organization said.
Yvonne Agustin, executive director of the United Coconut Association of the Philippines (UCAP), on Wednesday said preliminary data placed CNO exports for the month at 76,582 metric tons (MT), down 32.5 percent from 113,492 MT a year earlier.
It was also below the industry’s monthly shipment average of 80,000 MT.
“Raw materials were not easily available during the period. Also, many of our buyers placed small orders since they know of our situation when it comes to the supply of copra,” Agustin said.
Year to date, CNO exports were down 3.7 percent to 638,804 MT compared to the 663,480 MT recorded in the same period last year.
Agustin also attributed the weak demand to the wide gap between prices of CNO and palm kernel oil, a cheaper alternative. In September, prices of CNO averaged $1,046 per MT, higher than palm kernel oil at $789 per MT.
Agustin expressed confidence that the industry would still hit the CNO export target of 804, 000 MT, with any impact from the El Nino weather phenomenon being felt next year.
She added that the UCAP was monitoring the weather and was of the view that a prolonged dry spell would have a minimal effect on coconut production.
“Based on studies, a dry spell for coconut trees should be four straight months of rain under 50 millimeters. So a major rainfall could easily mitigate the impact of El Nino to coconut crops, which is very resilient,” she said.
“There are reports that some coconut areas are already experiencing effects of El Nino, so these are the areas that we are going to observe,” she added.
Coconut oil, which is used in food, cosmetics, and energy-related products, is one the Philippines’ top dollar earners.
At present, the Philippines exports over 70 percent of its coconut oil produce, of which about 80 percent go to Europe and the United States.