PHILIPPINE coconut oil exports surged by 73.2 percent in the first four months of the year purely on low base effects, despite the tight supply in raw material and tough competition in the international market, the United Coconut Association of the Philippines (UCAP) said Thursday.
Citing preliminary data, UCAP executive director Yvonne Agustin said coconut oil (CNO) exports reached 327, 151 metric tons in January to April 2017, from 188, 885 MT a year earlier.
“The industry managed to post growth for the first four months thanks to low base. But if you will look closely, there is a delayed recovery in the sector because of El Niño,” Agustin said in an interview with The Manila Times.
The CNO subsector suffered from tight supply of raw material in the first half of 2016 the drought that hit major coconut producing areas nationwide. Until now copra is in short supply, Agustin noted.
“It is also notable that the export figures for January 2017 significantly helped boost the average export figures for the first four months,” she said.
“There is demand in the international market, but we are still lacking in raw material,” she said. CNO exports posted only low increases in February to April.
In April 2017 alone, CNO exports increased by 17.9 percent to 47,611 MT compared with 40, 374 MT in April 2016. But the shipment volume was below the ideal average monthly shipment of 80,000 MT.
The highly competitive world market has placed Philippine suppliers under pressure as prices gaps continued to widen. A wider price gap usually compels buyers to shift to a cheaper alternative.
In April, CNO fetched $1,539 per MT on average, but the main alternative was prices at $1,031 per MT.
“The big gap in the prices of coconut oil and palm kernel oil has significantly affected shipment volumes in April,” Agustin noted. Just the previous month, prices were pegged at $1,539 per MT for coconut oil and $1,224 per MT for palm kernel oil.
Used in food, cosmetics and energy-related products, coconut oil is one the Philippines’ top dollar earners.
The Philippines sells over 70 percent of its coconut oil to the export market, of which about 80 percent go to Europe and the United States.