The coconut market is experiencing an unparalleled period of volatility and transformation, as prices for coconut oil and related coconut products have soared on the back of tightening supplies. In just a single week, retail coconut oil prices leapt by nearly $1 to reach $4.92 per litre—a direct consequence of dwindling copra production in critical regions such as Kerala and Tamil Nadu. This acute shortage has sent ripples throughout the value chain: copra and raw coconut prices have both escalated, with local demand for coconut oil falling between 10% and 20% as consumers pivot toward more affordable oils like palmolein and sunflower.
These market shifts are set against a backdrop of growing concerns: increased adulteration risks, government intervention calls, and the looming threat of long-term demand erosion. With exports on the rise due to favorable free trade agreements, the industry is increasingly looking outward even as domestic consumption becomes uncertain. The interplay between policy changes—such as reduced import duties on vegetable oils—and market fundamentals will dictate the path forward. As the Onam festival approaches, many are watching to see whether coconut oil could breach the $6 per litre mark, a symbolic threshold that encapsulates the anxieties and opportunities within this sector.
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Coconut dried
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FOB 4.65 €/kg
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Coconut dried
flakes
FCA 3.00 €/kg
(from NL)
Coconut dried
flakes
FCA 2.62 €/kg
(from NL)
📈 Latest Prices at a Glance
| Product | Type | Origin | Location | Delivery Terms | Current Price (EUR) | Previous Price (EUR) | Last Updated | Change | Sentiment |
|---|---|---|---|---|---|---|---|---|---|
| Coconut dried | Flakes | VN | Hanoi, VN | FOB | 4.65 | 4.63 | 2025-06-14 | +0.02 | 🔼 Bullish |
| Coconut dried | Flakes (Org.) | PH | Dordrecht, NL | FCA | 3.00 | 3.00 | 2025-06-13 | 0.00 | ⏸️ Steady |
| Coconut dried | Flakes | PH | Dordrecht, NL | FCA | 2.62 | 2.62 | 2025-06-13 | 0.00 | ⏸️ Steady |
| Coconut dried | Desiccated Medium | ID | Dordrecht, NL | FCA | 1.87 | 1.87 | 2025-06-13 | 0.00 | ⏸️ Steady |
| Coconut dried | Desiccated | ID | Dordrecht, NL | FCA | 1.90 | 1.90 | 2025-06-13 | 0.00 | ⏸️ Steady |
🌍 Supply & Demand Dynamics
- Supply Crunch: Copra output continues to decline in major producing states of India, causing a domino effect along the coconut supply chain.
- Retail Price Impact: Coconut oil is trading at a steep premium to substitutes (current prices: palmolein – $1.56/litre, sunflower oil – $1.80/litre), fueling demand destruction in the domestic market.
- Exports Rising: New FTAs have opened up global opportunities; value-added coconut product exports are on the rise, buffering the domestic slump.
- Shift in Consumption: A notable portion of consumers have shifted to cheaper edible oils, with industry insiders warning this could become a persistent trend if high prices linger.
📊 Market Fundamentals & External Influences
- Production: Copra and raw coconut shortages are the chief drivers behind the price rally.
- Adulteration Worries: The spread of low-quality, solvent-extracted coconut oil has triggered regulatory crackdowns—42 brand bans recently reported.
- Policy Moves: Industry is lobbying for import restriction lifts and welcoming the reduction in import duties on crude vegetable oils.
- Speculative Activity: The sharply rising price curve is attracting increased speculative interest, further amplifying volatility.
🌦️ Weather Outlook & Crop Impact
- India (Kerala/Tamil Nadu): Recent news and satellite data highlight anomalously dry conditions that have stressed coconut palms and reduced yields. Some improvement is expected next week, but not enough to reverse cumulative losses.
- ASEAN (Philippines, Indonesia, Vietnam): Southeast Asia’s main coconut regions are entering the wet season, with mixed rainfall distribution. Indonesia and the Philippines are reporting average yields but remain cautious due to sporadic droughts and typhoons.
- Global Supply: Any weather improvement may only moderate but not fundamentally reverse the current supply shortage for the next 2–3 months.
🌐 Production & Stock Table
| Country | 2024 Production (Est. 1000 MT) | 2024 Stocks (1000 MT) | Change vs. 2023 (%) |
|---|---|---|---|
| India | 14,100 | 750 | -4.2% |
| Indonesia | 18,000 | 900 | 0.0% |
| Philippines | 14,500 | 800 | -1.6% |
| Vietnam | 2,000 | 140 | +2.5% |
📆 Trading Outlook & Recommendations
- 🌟 For Buyers: Secure supply contracts early—further price surges are plausible ahead of the Onam festival. Consider partial substitution with palmolein/sunflower oil where product constraints allow.
- 🚩 For Sellers: Favor spot sales and limited forward contracts to capitalize on bullish momentum, but stay vigilant for any government intervention or import liberalization.
- 🔍 Risk Managers: Guard against adulteration risks through supply chain audits. Be ready for increased volatility and counterparty risks from speculative trading and regulatory changes.
- 🌱 Long-term Planners: Closely monitor consumer loyalty trends—recovery in coconut oil demand may be slow if pricing remains substantially above substitute oils.
🔮 3-Day Regional Price Forecast
| Exchange/Market | Current Price (USD) | 3-Day Forecast (USD) | Sentiment |
|---|---|---|---|
| Kerala Copra (per kg) | 2.77 | 2.85 – 2.95 | ⏫ Bullish |
| Tamil Nadu Copra (per kg) | 2.72 | 2.78 – 2.88 | ⏫ Bullish |
| Retail Coconut Oil (per litre) | 4.92 | 5.10 – 5.30 | ⏫ Bullish |
| Raw Coconut (per kg) | 0.84 | 0.86 – 0.90 | ⏫ Bullish |
