Market Update 10th Febuary 2025

Coconut Oil: Price Strength Amid Tight Supply

Coconut oil prices have remained high, with CIF prices in Rotterdam ranging from $1,950 to $2,005 per metric ton as of February 1, 2025. This indicates a sustained premium over palm kernel oil, which has experienced a narrowing price gap. Market analysts attribute this price resilience to supply tightness and reduced production in key producing countries. In January 2025, the Philippines exported 114,630 metric tons of coconut oil, marking a 9.6% decline compared to the previous year. However, the export value surged by 66.4% due to higher prices.

Desiccated coconut has experienced significant price growth, with FOB prices now ranging from $0.80 to $1.70 per pound, an increase compared to previous months. In Manila, domestic prices for 100-pound bags have fluctuated between PHP 5,255 and PHP 5,547, reflecting the heightened global demand.

Supply Chain Challenges and Market Adjustments

The global coconut industry is facing new challenges, such as extreme weather events affecting harvests and logistical constraints impacting shipments. In Malaysia, coconut prices have surged due to shortages, raising concerns about the reliability of supply, especially during high-demand periods like Ramadan and festival seasons. Additionally, Sri Lanka has paused 20 land development projects to protect coconut plantations, reflecting broader efforts to maintain production capacity.

Looking Ahead: A Competitive Market in 2025

The 2025 outlook indicates continued price volatility for coconut oil and desiccated coconut due to strong demand. The Philippines is enhancing replanting efforts, and exporters are focusing on supply chain efficiency and trade negotiations to stabilise prices. With growing consumer interest in coconut-based products for food, health, and biofuels, the market is expected to expand despite near-term uncertainties.