BY DR THEN KEK HOE
COCONUT (Cocos nucifera) or commonly known as ‘tree of life’ with multifarious uses is an important oil and food crop that grows over 90 countries.
Coconut is mainly planted in Asia, Pacific Islands and South America.
The world coconut planted area in 2014 was about 12.20 million ha with total coconut production of 69.84 billion nuts annually.
[ihc-hide-content ihc_mb_type=”show” ihc_mb_who=”2,3,5″ ihc_mb_template=”1″ ]Currently, India is the largest coconut producing country, with total production of 21.67 billion nuts in 2014, followed by Indonesia and Philippines at 16.35 billion nuts annually and 14.70 billion nuts annually, respectively.
Brazil and Mexico are the major coconut producing countries in South America, with a production total of 2.92 billion nuts annually and 1.12 billion nuts annually, respectively.
The other world top 10 coconut producing countries are Sri Lanka, Papua New Guinea, Vietnam, Thailand and Malaysia.
The total coconut planted area of India, Indonesia and Philippines are the largest among the coconut planting countries, with total area spanning about 9.25 million ha or 75.9% of the total world planted area.
Meanwhile, Brazil and India are the most productive coconut producers with more than 10,000 nuts/ha annually.
Their high yielding performance was contributed by their aggressive replanting programmes.
Supply Chain of Coconut Industry
All the plant parts of coconut palms and fruits are economically valuable as they can be turned into all kinds of food and non-food products.
Coconut oil is the primary product derived from coconut meat kernel, where it is widely used for processing into cooking oil, virgin coconut oil, soap and detergents.
The meat or kernel is also used to produce desiccated coconut, coconut flour and coconut milk powder, where the copra meal after oil and milk extraction is used as livestock feeds.
The coconut water is not only a refreshing drink but it is also used for processing into vinegar, nata de coco and wine.
The sap juice collected from the stalk is used to produced jaggery, nectar, sugar, vinegar and wine.
Meanwhile, the husk and kernel shell that remains after extraction of the meat kernel is used for producing non-food products, such as ropes, geotextiles, mats, baskets, organic fertiliser, rooting media, horticulture pots, charcoal, activated carbon and handicrafts.
The leaves, inflorescence and wood from the trunk is utilised to produce furniture and handicraft.
The coconut oil is also an important ingredient for the oleo chemicals industry to produce fatty acids, methyl ester, fatty alcohols and glycerin.
Global Supply and Demand of Coconut Products
Coconut oil (CNO) is one of the major vegetable oils and has been traded in the global market for decades.
However, the total production of CNO was low over the past 20 years, at a production level of 3.0 million tonnes per year.
CNO only contributed about 1.5% of the total world vegetable oil production in 2016 as compared to palm oil, soybean oil and rapeseed oil, which had all dominated more than 78% of the world vegetable oil market.
CNO and palm kernel oil (PKO) are the two major vegetable oils that are rich in Lauric acid, a medium chain triglyceride (MCT) consisting more than 50% in content.
CNO has always enjoyed a premium market price higher than PKO since year 2005, especially during the 2014-2016 period which recorded more than 20% of premium price.
This is mainly due to higher market demand on CNO as compared to PKO.
Currently, there are about 52 types of coconut based food and non-food products in the global market.
Coconut water and virgin coconut oil (VCO) are among the new emerging coconut products that receive fantastic market demand globally.
Coconut water which also called the “fluid of life” is rich in amino acids, sugar, vitamins, minerals and enzymes that can promote anti-aging, healthy cell growth and rehydration.
Coconut water is the fastest growing new beverage with a rapidly expanding growth market, especially in United State of America with total sales that recorded USD350 million annually.
Brazil and Philippines are leading in global coconut water export.
Philippines has reached its peak on coconut water export at 61 million tonnes in 2015, where 45.4% was exported to United States of America and 38.6% to United Kingdom.
The current price of coconut water is about USD1.13 per litre.
Meanwhile, VCO which has health benefits is also one of the fastest growing coconut products with high value in niche markets.
The current price of VCO is ranged between USD4,000 to USD6,000 per ton.
Philippines is the major VCO producer and exporter, where their VCO export grew drastically from 103 tonnes in 2003 to 36,332 tonnes in 2015 with the total export earnings of USD 129 million.
The major importers of VCO are United States of America (59.7%), Netherlands (10.1%) and Canada (8.5%).
The Opportunity and Challenges of Coconut Industry in Malaysia
Coconut is one of the earliest commodity crops in Malaysia and currently the fourth important industrial crop after oil palm, rubber and paddy.
The coconut planting area in Malaysia gradually decreased from 120,000 ha in 2005 to only 85,000 ha in 2016 by total reduction of 30% within 10 years.
The coconut production area in Malaysia is mainly concentrated along the west coarse of Peninsular Malaysia. Selangor (Sabak Bernam and Kuala Selangor), Perak (Hilir Perak) and Johor (Batu Pahat, Pontian and Muar) are the major coconut producing states.
Jointly they produced more than 56% (283,241 tonnes) of the total coconut production of Malaysia in 2016.
Coconut production in Malaysia showed declining trend from 625,000 tonnes annually in 2013 dropping to about 500,000 tonnes annually in 2016.
The decrease in planting area and production of coconut in the country was mainly due to the conversion of coconut planting into oil palm.
Malaysia is also facing a shortage of coconuts.
Import of coconut from Indonesia was estimated about 115 million nuts annually on top of domestic supply about 650 million nuts annually.
Malaysia is also the exporter of several coconut based products such as coconut oil, desiccated coconut, coconut milk powder, copra, coconut activated carbon and coir fibre, all which contributed about USD2.04 billion for national export earnings.
Currently, Malaysia facing fluctuations of unfavourable low price of crude palm oil, especially after a drastic drop from RM3,500 per ton to only RM2,000 per tonne in 2012.
The lowest recorded price level ranged RM2,000-RM 2,400 per tonne in 2013 and the middle 2014 to 2015.
Therefore, other new strategic industrial crops such as coconut which is currently driven by high market demand and premium value should be explored in Malaysia to avoid over dependence on oil palm commodity.
The agro-climatic requirement for coconut planting (annual rainfall > 2,000 mm; mean annual temperature 27-32°C; short dry spell; slope 0-4%; imperfect to well drain soil, not flooding, deep soil > 100 cm and soil texture: clay loam, clay, sandy clay, sandy clay loam and loam) are almost similar to oil palm, therefore the low productive senile oil palm farms or estates with above agro-climatic criteria should be replanted with coconut.
Meanwhile, coconuts are known to be more tolerant to basal stem rot (BSR) disease as compared to oil palm, therefore the highly BSR infected areas of oil palm should be replanted with coconuts to ensure land productivity and profitability.
Currently, more than 90% of the existing coconut farms in Malaysia are managed by small holders and planted with conventional varieties, mainly ‘Malayan Tall’ that produces less than 10,000 nuts/ha/year with 1.5 tonnes oil/ha/year.
This is not able to match the revenue from oil palm and other commodity crops.
However, the current recommended MATAG hybrid coconut (Malayan Yellow Dwarf/ Malayan Red Dwarf X Tagnanan Tall) is able to increase the potential yield to more than 25,000 nuts/ha/year with 4.7 tonnes oil/ha/year and it is the key factor to bringing back the confidence of the growers to generate better revenue in coconut planting.
Meanwhile, cocoa and coffee which require partial shade in their cropping system are suitable for intercropping with coconut to increase the land productivity and improve the profitability to coconut growers.
However, the low availability of MATAG hybrid coconut seedlings supply from the Department of Agriculture and other two private companies which are only able to produce 50,000-70,000 seedlings annually is the main constraint.
Perhaps the involvement of private plantation companies to establish the coconut seed garden for producing adequate MATAG or other coconut hybrid seedlings can ensure the successfulness on the expansion of coconut cultivation in Malaysia.
Meanwhile, coconut red palm weevil (RBW) (Rhynchophorus ferrugineus) that seriously attacked the coconut palms in east coast of Peninsular Malaysia and had caused severe damage and high mortality to the coconut palms is the major threat to coconut planting and expansion in Malaysia.
Conclusion
Global coconut planting is now saturated at about 12 million ha and produces only 65-70 billion nuts annually since the past 10 years.
This amount is insufficient to support market demand and the development of the global coconut industry.
Currently, coconut based products receive huge demand globally and generate great economic value for the producing countries.
Therefore, Malaysia should take this opportunity to diversify our plantation and agro-based industry into coconut planting as the new strategic crop for the country.
NOTE: The writer is the Chief Agronomist of Agronomy Multicrop at Felda Global Ventures Research & Development Sdn Bhd, a subsidiary of FGV Holdings Berhad.
He holds 15 years’ experience conducting research activities in various crops.
He also provides technical advisory services and feasibility study in coconut, sugarcane, tropical fruits and other new strategic crops.
For more information, visit http://www.feldaglobal.com/our business/plantation/rd-services or drop an email to kh.then@ feldaglobal.com
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