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Jul 15, 2019 @ 9:31

Industry body proposes practical solutions to coconut oil supply glut

A proposed 5-percent blend (B5) of Coconut Methyl Ester (CME) in automotive diesel from the current 2 percent will take almost a third of the local coconut oil production, which would help ensure a steady income for most of the 6 million coconut farmers.

This was pointed out by the United Coconut Association of the Philippines (UCAP) Executive Director, Yvonne Agustin.

“Demand for coconut oil in the manufacturing industry is not that big,” she said. “Currently, our country’s coconut oil export is bigger than our local consumption. Increasing local demand will help manage our present glut in coconut oil production.”

The US and the Netherlands are the biggest export markets for crude coconut oil, which is used in many industries from personal care to industrial, and food production.

In comparison, the current oversupply in palm oil in Indonesia and Malaysia is leading to an increase in palm oil content in the countries’ biofuels mix. Indonesia is considering increasing that level to 30 percent or B30.

In the Philippines, however, the coconut oil content (which is comparatively more superior) in local diesel has been stagnant at 2 percent (B2) since 2008.

The glut in palm oil is also affecting consumer consumption of coconut oil in the Philippines.

“Because palm oil has become cheaper, most of the commercially available cooking oil in the Philippines is switching to it. Our own coconut oil market is being lost,” Agustin said.


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