Coconut Market Outlook 22nd April 2026

The Strait of Hormuz closure, now in its eighth week following the late-February US–Israeli air campaign, remains the single most consequential variable for Southeast Asian coconut supply-chain economics. Iran’s position as of mid-April is that the closure will persist until the US ends its blockade of Iranian ports, and resolution appears to be a matter of weeks or months rather than days. WTI crude is holding around $110 per barrel (up from roughly $83 pre-war), the IEA has characterised the situation as the largest supply disruption in the history of the global oil market, and the IMF has lifted its 2026 global inflation forecast by 0.6 percentage points to 4.4%, with global food commodity prices projected up 5%.

First, ocean freight: even after this week’s 3% pullback, Asia–Northern Europe rates remain elevated due to war-risk surcharges and Cape of Good Hope diversions, adding 10–14 days to lead times. European clients — roughly half of the shipment volume — absorb most of the landed-cost impact.

Second, energy and processing costs: elevated bunker and fuel prices continue to feed through to cold-chain, packaging and mill operations, with the Philippine peso at approximately ₱60.07 to the US dollar per the PCA 20 April report.

Third, fertiliser: over 30% of global urea transits the Strait of Hormuz, and the 3–6 month lag means Philippine agricultural input costs will tighten meaningfully through the second half of 2026, putting upward pressure on farmgate economics and, by extension, copra and DC raw material costs.

Fourth, and most strategically significant, is the biofuels channel.

Indonesia is expanding its B50 biodiesel and E10 ethanol programs, with plans to increase domestic palm oil use and eliminate diesel imports once B50 is fully active. Meanwhile, Brazil is speeding up biodiesel blend testing up to 20%, driven by rising fuel prices due to the war. These moves benefit the lauric-oil sector: more palm oil for energy boosts demand for coconut oil in food, oleochemicals, and specialty uses. level. This aim

This is the mechanism most likely to provide a floor under coconut oil values through the remainder of 2026, even as near-term Rotterdam pricing remains range bound.

On the trade-policy side, the 17–19% US reciprocal tariff on Philippine goods (effective 10 April) continues to pressure the 25–30% of Philippine coconut volume shipped to North America. There is no confirmed relief for the coconut or banana chip categories, and negotiations have so far produced only marginal adjustments.

The combined effect of the tariff and the war-driven freight and input-cost environment is to compress margins across the supply chain simultaneously — a situation that typically favours sellers with the deepest client relationships, the most flexible contract structures and the clearest communication on landed-cost pass-through.

Drewry’s latest World Container Index, published 16 April 2026, showed the first significant easing in over a month, with the composite WCI dropping 3% to $2,246 per 40-foot container after a six-week rally caused by bunker-fuel spikes from the late-February Middle East conflict.

Declines were mainly on Asia–Europe and Transpacific routes, while Transatlantic rates remained steady.

However, this relief is likely temporary. Carriers will impose a $2,000 Peak Season Surcharge from 1 May, and nine blank sailings are planned on the Transpacific to maintain capacity discipline.

For Philippine coconut exporters, the window to benefit from the current rate softening is narrow, and contract prices should be reviewed before the surcharges take effect.

Drewry warned that if Strait of Hormuz negotiations fail, schedules could face further disruptions, port omissions, longer lead times, and rising freight rates. The Intra-Asia Container Index increased 4% in April to $870, indicating regional activity remains strong.