Desiccated coconuts: El Niño and typhoons stir unease

Market recovers

Following the fall in prices in May and June, Philippine coconut prices recovered sharply in July. Purchase prices for copra fell from late April to mid-June, then rose sharply until mid-July, before falling again. This pattern suggests that the local market remains sensitive to changes in supply and is still prone to sharp price fluctuations.

Coconut oil also followed this trend. Following high and volatile prices at the end of April, prices fell in May and June before recovering significantly in July. Palm oil remained comparatively stable. According to the latest report from JCP International, the market was supported by demand from the biodiesel sector and policy measures, whereas production, stock and export data caused temporary declines.

In addition, processors have passed on the increased costs of replacing coconuts and copra. As raw material prices have recovered significantly since their low in June, and freight, oil and weather risks remain elevated, quotations for later delivery dates should remain firm. Processors may also protect their margins by shortening the validity periods of their prices, reducing flexibility or limiting availability.

El Niño and typhoon season to cause disruptions

According to the Philippine weather service PAGASA, El Niño was already clearly present in July and will intensify further. High probability is that the weather phenomenon will persist into the first half of 2027. The immediate effects on the market are often psychological in nature and characterised by caution. By contrast, the impact on crops may be delayed, as coconut palms only react to drought stress over time, as JCP International further reports. Prolonged dry spells can affect flowering, fruit set and future yields as well as water availability and farm productivity. Palm oil production in Southeast Asia is also affected by rainfall deficits, although the timing and regional impacts may vary.

According to PAGASA, the peak season for tropical cyclones runs from July to October, during which around 70% of all typhoons form in the Philippines. Tropical cyclones can temporarily alleviate dry spells through rainfall, but at the same time they can also damage palm trees and disrupt harvests, road transport and the electricity supply as well as port operations, processing and shipping. Consensus is that the combination of a strengthening El Niño and an active typhoon season has the potential to affect future supply and logistics.

In the short term, the market for coconut oil will remain elevated yet volatile. A sustained decline to June’s price levels would require a significant improvement in copra availability, lower prices for competing vegetable oils, and reduced geopolitical and freight-related risks. For desiccated coconuts, JCP International anticipates a stable market in the short term. Rising costs for coconuts and copra, as well as freight and weather risks, are therefore increasing the probability of firmer offers, particularly for later delivery dates.

Desiccated exports rise

International export prices for desiccated coconuts are still fixed. At the same time, production costs in the Philippines have risen. Domestic desiccated coconut also range a bit higher as T.M. Duché reports.

According to estimates issued by the United Coconut Associations of the Philippines (UCAP), Philippine year-on-year coconut exports fell by 3% in June and stood more than 30% lower than in May. Coconut oil exports fell by around 6% in June and were also lower than last year in the first half of 2026. Contrary to this, desiccated coconut exports rose by 5% to 14,124 mt and ranged above last year’s figure in the first half of 2026.

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