MANILA – The country's exports of coconut oil continued to rise as of September this year on the back of stronger demand from the traditional markets, the United Coconut Association of the Philippines said over the weekend.
Yvonne Agustin, UCAP executive director, said that preliminary data showed that CNO exports reached 659,455 metric tons in January to September 2012, 3.8 percent higher from last year’s level of 634,911 MT.
“Demand from our major markets for the product continued to be stable,” Agustin said, noting that ample supply of the commodity allowed the industry to meet demand.
In September 2012 alone, coconut oil exports surged 41 percent to 71,992 MT from 51,007 MT a year ago.
Agustin attributed the sharp increase to base effects, as demand from the United States and Europe –the key overseas market for the commodity– had slumped last year.
She also credited the higher shipments this year to the market’s shift away from palm kernel oil and towards CNO because of narrowing price differentials.
“These shipments were traded maybe a month before, when coconut oil was still at a discounted price against palm kernel oil. That may have also caused buyers to favor coconut oil,” Agustin said.
Palm kernel oil is coconut oil’s premier competitor in the world market.
Early this year, coconut oil was priced higher than palm kernel oil, but since March, the premium between both began to narrow, Agustin said.
Last month, CNO was priced at an average of $952 per metric ton during the period, while palm kernel oil was at $971 per metric ton.
With the continued growth in CNO exports, the official also said that the industry remains on-track towards meeting its target.
The Philippines aims to ship 925,000 metric tons of CNO this year as copra production picks up.
Earlier, the Asian Institute of Petroleum Studies Inc., a knowledge-based company that conducts studies on petroleum and biopetroleum products, has called for the use of coconut oil in biofuel mix to ease effects of production surplus.
Rafael Diaz, AIPSI executive director, said that the abundant coconut harvests due to the government’s fertilization program and low global demand for coconut oil have depressed copra and coconut oil prices.*PNA