The Philippines’ coconut oil exports dropped by 2.3 percent at the start of the year as supply of raw material continues to tighten because of El Niño, the United Coconut Association of the Philippines (UCAP) said Tuesday.
UCAP executive director Yvonne Agustin, citing preliminary data, said that CNO exports reached 59,249 metric tons in January 2016, or 2.3 percent lower than the 60,658 MT recorded during the same period last year.
“There’s a continued tightness of supply of copra because of the persistent dry weather,” Agustin said in a telephone interview.
The official added that January’s shipment volume was also significantly lower than the ideal average monthly shipment of 80,000 MT.
During the period, prices of CNO averaged $1,148 per MT, higher than its competitor palm kernel oil at $896 per MT.
Agustin, however, said that the wider gap in the prices of CNO and palm kernel oil has had little effect, as demand from traditional buyers remained stable. A bigger price differential usually results in buyers shifting to the cheaper alternative.
For this year, the CNO industry has set a lower export target of 750,000 MT, primarily due to the drought.
In 2015, CNO exports also slipped 1.5 percent to 843,710 MT compared to the 856,970 MT shipped in 2014. Despite the weakness in demand, the industry was able to exceed its full-year shipment target of 804,000 MT.