The country’s coconut oil industry is showing signs of recovering from the impact of Typhoon Yolanda as exports surged by 87.1 percent in January, the United Coconut Association of the Philippines (UCAP) said on Thursday.
UCAP executive director Yvonne Agustin said that CNO exports reached 79,250 MT in January 2015, or 87.1 percent higher than the 42,360 MT recorded during the same period last year.
“This is a welcoming development [after failing to reach last year’s target]since we hit the monthly shipment average of 80,000 MT,” Agustin said in a telephone interview.
“But we have to remember that we have a low baseline figure at the start of last year,” she added, referring to the low output in January 2014, just two months after Typhoon Yolanda caused widespread destruction in the country’s key coconut-producing region of Leyte and Samar.
Nonetheless, the official is hopeful that they will continue to hit the average export figures in the first three months of 2015 as traditional buyers replenish stocks.
Agustin attributed the higher exports volume to the narrowing gap in prices of CNO and its competitor palm kernel oil. A bigger price differential usually results in buyers shifting to the cheaper alternative.
Prices of CNO averaged $1,137 per MT in January 2015, higher than palm kernel oil at $1,010 per MT.
For this year, the CNO industry has set a lower export target of 804,000 as Yolanda-stricken areas may take another 4-5 years before they can go back into the production stream. The region accounts for over 15 percent of total CNO production.
In 2014, CNO exports reached 795,297 metric tons, lower than the 850,000 MT target.
Last year’s export figures were also lower by 27.5 percent from the 1.096 million MT in 2013.
Agustin attributed the previous drop in exports to severe disruption of copra supply because of the typhoon, coupled with the natural biological stress to coconut trees.
“The coconut sector, particularly farmers in the Eastern Visayas, is still reeling from the damage caused by super typhoon Yolanda,” she said, adding that this resulted in tightness in supply of copra, the raw material for coconut oil.
“We are not expecting an immediate contribution to export figures in Yolanda-affected areas because it may take several years for them to recover,” she added. “If ever there will be increase in supply of raw materials, the growth will come from other areas such as Bicol.”
To recall, the Philippine Coconut Authority said that over 34 million trees have been confirmed damaged by Yolanda in Samar, Leyte, and the Western Visayas. This comprises 10 percent of 340 million coconut trees in the country.
Agustin, on the other hand, noted the positive development in the recovery of coconut trees affected by biological stress because of ample amount of rainfall in the previous months.
Biological stress is common to coconut trees, and usually occurs after three consecutive years of good harvest.
The official also allayed fears over possible effects of the El Nino phenomenon, saying that the prolonged dry spell will have “minimal” impact to coconut crops.
“Negative effects will be felt in the next year’s production. But since it’s just a mild El Nino, we will not be affected,” she said. “Based on studies, dry spell to coconut trees should be four straight months of rain under 50 millimeter. So one major rainfall could easily mitigate the impact of El Nino.”
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 production of which about 80 percent goes to Europe and the United States.