Rising demand for oleochemicals to improve coconut prices
The United Coconut Association of the Philippines (UCAP) said there is now a rising demand for oleochemicals, a development that could improve the prices for coconut.
UCAP said that most experts agree that there is another viable option that would result to increased in prices for coconut. That is the higher demand from increased use of coconut oil for oleochemicals.
Oleochemicals are chemicals that are comprised of organic oils like coconut oil and palm kernel oil. It is the form that is commonly used as a main component of many important consumer products that are commercially sold in the market.
For instance, coconut oil has almost half of the content of C12 lauric acid (a form of oleochemical), which is the best raw material for manufacturing detergent.
In the past decades, palm kernel oil has been the preferred source of C12 lauric acid for such a purpose because it is more easily sourced and is less costly.
However, UCAP pointed out that when prices of coconut oil started to drop in January 2018 (to almost equal prices of palm kernel oil) and supply started to get more stable due to favorable climate and recovery of trees from El Niño in 2015, it has become a more ideal component for the oleochemical.