Market Update 10th August 2026

The coconut market has softened further this week, particularly in coconut oil, while desiccated coconut export pricing remains remarkably stable. Freight rates into Europe have stabilised after several weeks of decline, and the developing El Niño is becoming an increasingly important supply-side factor to watch for the remainder of 2026 and into 2027.

Desiccated Coconut

International desiccated coconut prices remain unchanged at 109–190¢/lb FOB, marking the 25th consecutive week in which the headline export range has not moved. However, the average quoted seller price declined from 135.33¢/lb to 132.83¢/lb, a fall of 2.50¢/lb week-on-week.

The domestic Manila market also eased slightly, with prices at ₱5,537–₱5,845 per 100 lb bag, compared with ₱5,557–₱5,866 the previous week. The average domestic price declined by ₱20.50 to approximately ₱5,691 per bag.

The important point for buyers is that although the very wide 109–190¢ range remains unchanged, there is evidence of softer pricing within that range. This broadly follows the recent easing in coconut oil and raw material values.

However, we would be cautious about interpreting this as the beginning of a significant downward correction. Philippine coconut supplies remain exposed to weather risk, with the developing El Niño will become increasingly relevant to nut production later this year and into 2027.

Coconut Oil

Coconut oil prices continued to move lower.

For the week ending 1 August, the nearest Rotterdam coconut oil value averaged approximately US$2,030/MT CIF, down US$58.50/MT from US$2,088.50 the previous week. Actual reported business finally returned to the market, with forward trades concluded at around US$1,900/MT CIF for Q1 2027 delivery.

By Friday 7 August, the Philippine Coconut Authority was reporting European coconut oil at approximately US$1,930/MT CIF, indicating that the softer tone has continued into the new week.

The forward curve has moved below the psychologically important US$2,000 level for several positions:

• September/October: around US$1,983.50/MT CIF
• October/November: around US$1,980/MT
• November/December: around US$1,980/MT
• Q1 2027 trades: approximately US$1,900/MT

Another interesting development is the relationship with palm kernel oil. Coconut oil has now traded at a discount to PKO for five consecutive weeks. The nearest-forward discount widened sharply to around US$138/MT, compared with approximately US$55/MT the previous week. With PKO at US$2,100/MT, against coconut oil at US$1,930/MT.

This changes the substitution economics for industrial buyers. After the exceptional coconut oil premiums seen during 2025, CNO is now considerably more competitive against its closest lauric oil alternative.

Philippine Raw Material Market

Local copra pricing remains volatile rather than uniformly weak.

UCAP reported that Quezon copra values recovered during the week, while several producing regions of Mindanao continued to command substantially higher prices. Mati and Davao City were amongst the highest-priced locations at around ₱6,195 per 100 kg.

More recent PCA data for 7 August nevertheless shows the national average millgate copra price falling to ₱49.91/kg, versus ₱53.58/kg one week earlier. It remains dramatically below the ₱73.21/kg average recorded a year ago.

The fall in copra alongside coconut oil is providing some relief to processors, but regional availability remains uneven.

Container Shipping

After three consecutive weekly declines, Drewry’s World Container Index edged 1% higher to US$4,297 per 40ft container on 6 August.

For shipments into Europe, the more relevant Shanghai–Rotterdam benchmark remained unchanged at US$4,653 per 40ft, while Shanghai–Genoa declined 2% to US$5,506. Drewry expects Asia–Europe rates to remain broadly stable in the immediate term as carriers continue to control available capacity through blank sailings.

There are, however, several reasons why we would not expect freight to return quickly to the considerably lower levels seen during parts of 2025. Drewry highlights continuing Middle East tensions, US tariff uncertainty, congestion at Asian ports and carrier capacity management. Emergency fuel surcharges are also being introduced by a number of carriers following renewed Middle East disruption.

El Niño: Risk Increasing

The El Niño outlook has significantly strengthened. PAGASA reports that a weak to moderate El Niño is currently present in the tropical Pacific, with about a 97% chance it will persist into the first half of 2027.

There is a 57% likelihood of a strong event from to September, and an 81% chance of a very strong El Niño from October to December.

NOAA’s August 3 update confirms that El Niño is present and growing stronger, with the Niño 3.4 sea-surface-temperature anomaly around +1.5°C. NOAA also notes decreased convection and rainfall over the Philippines and Indonesia.

PAGASA’s rainfall outlook for the Philippines varies, but it increasingly indicates significantly drier conditions later in the year. For November, 81 out of 85 assessed areas are forecast to have below or well below normal rainfall. Several coconut-growing regions show similar patterns; for example, PAGASA predicts only about 55% of normal rainfall in Albay, 43% in Camarines Sur, 65% in Davao Oriental, and 60% in South Cotabato in November.

This does not immediately mean a coconut shortage, as coconut palms respond to rainfall stress with a delay, and current availability is affected by past conditions, harvesting, demand, and regional supplies.

However, extended below-normal rainfall through late 2026 could increase the risk of reduced nut yields and tighter raw material supplies in 2027. Interestingly, actual recent rainfall has been mixed: UCAP recorded average rainfall from July 28 to August 3 of 101.8 mm in Luzon, 55.0 mm in the Visayas, and 51.5 mm in Mindanao. Mindanao was notably drier than the previous week’s 80.0 mm, while Luzon and the Visayas experienced slight increases.

A note on Rotterdam coconut oil prices

The Rotterdam market is now used relatively infrequently for physical coconut oil trading. A substantial proportion of international business is conducted privately between Philippine millers, major commodity traders and industrial buyers and is therefore not visible in published market data.

Consequently, a quiet Rotterdam market should not be interpreted as an absence of underlying business. We continue to report these prices because they remain one of the few transparent international reference points available, alongside our own market intelligence and direct trading activity.