Supply:
We begin by looking back at the many factors that have played an important role over the last couple of years in shaping where we are at to start 2026 along with any recent developments that will inform market conditions for Q1 and beyond
In 2025, we finally began to see relief from the poor yields experienced through 2024 due to El Nino weather phenomenon.
Coconut crops recovered throughout 2025; however, many mills continued to run at capacity as they worked to catch up on the many delays in shipments through 2024.
As backlogs continued to be filled throughout much of 2025, all time high prices only saw modest relief throughout the year.
Pricing for desiccated coconut and other coconut related products also remained high throughout this period as 2025 saw unprecedented demand for coconut oil due to, EUDR initiatives favoring CNO over PKO.
The Philippine government proposed mandates to increase the % of coconut oil from 3% to 4% in 2025, with a proposed further increase to 5% in 2026. These proposals have been delayed for the time being, due to the high prices of coconut, but will likely be enacted again once pricing stabilizes.
By late 2025, weather related disruptions again affected many mills as many regions throughout Southeast Asia experienced typhoons and flooding causing damage to crop, infrastructure and roads.
Shipping:
Shipping remained steady through out 2025. There were some disruptions due to the implementation of tariffs and reversal of tariff policies but for the most part they stabilized around 40-50 days with rates also remaining stable for most of the year.
Things to consider for 2026 Q1:
Markets have continued to stabilize with prices further normalizing. The market is likely to remain stable given that the reinstatement of the bio-fuel mandate will be used support sustainable pricing.
Considerations for shifts in any geopolitical dynamics may affect buying behaviours, supply chains, and as such may cause disruptions to market stability.
Given the erratic market conditions over the last number of years, and the current state of stability, we are suggesting to customers to cover all requirements for 2026.
If you have questions about the current market state or want to learn more about our products and what we can offer, please reach out. We would love to hear from you.