Desiccated coconuts: market remains extremely volatile

January 15, 2025 at 3:43 PM , Der AUDITOR
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MANILA. Many unpredictable factors make it very difficult to forecast the coconut market for 2025. However, the shortage of raw materials and low stocks are likely to lead to price increases.

Stable exports in 2024

The experts at T.M. Duché ventured an outlook for the coconut market in 2025 at the beginning of the year. Market players at all stages of the value chain are likely to be confronted with various hurdles, including lower production volumes, a corresponding shortage of raw materials and geopolitical tensions.

Philippine desiccated coconut exports proved to be very resilient in 2024 and were 3.8% higher in the January-November period than in the same period of the previous year. Most producers were able to increase their exports, especially in the second half of the year, but then there was a big bang when a major producer in the Philippines shut down its largest production facility. It is currently uncertain whether and when this will be put back into operation in 2025.

Rains give hope

Exports of high-quality coconuts had already fallen in June, and buyers in Europe and the Middle East in particular are feeling the effects of this shortage and are desperate to find the right goods. T.M. Duché also reports that the situation in the USA is a little more relaxed and there are still some coconut stocks here, so the supply chain is much more stable. However, if the decline in exports from the Philippines continues, this could also change soon. Last year's drought significantly affected production and the quality of coconuts; however, current rainfall gives market players hope that this problem will be less pronounced in 2025.

Transportation costs could rise

According to the market experts, high competitive pressure and scarce supplies worldwide are likely to lead to unavoidable price increases, especially as demand continues to rise. Transportation costs could also rise, partly due to global economic uncertainties and partly due to the fact that detours still have to be made around the Red Sea. There are also other unpredictable factors such as inflation, longer transit times, customs changes (e.g. on the part of the USA), etc. In summary, the coconut market will continue to be extremely volatile in 2025 and it will be difficult for all market players to plan for the long term.

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