By Adrian H. Halili, A reporter
THE biodiesel industry is struggling with limited availability of coconuts, shutting out sellers of products such as coconut oil and coconut water, industry officials say.
“The recent increase in the country’s biodiesel requirement may divert more coconuts for domestic consumption,” said Romeo I. Chan, chairman and chief executive officer of Axelum Resources Corp. BusinessWorld by email.
He sees a possible erosion of the volume available for export, while acknowledging “good environmental benefits (from the use of biodiesel), fuel efficiency and higher copra prices,” Mr Chan said.
“We also need to be aware that this may destroy the competitiveness of the export sector, which produces high value coconut products and generates dollar flow for the country,” he added.
In October, the composition of biodiesel fuel was increased to 3%, or B3, according to the order of the Ministry of Energy. The government plans to increase the biodiesel mix to B5 in the next three years.
“Ultimately, we believe this requires serious balancing act to manage its wider implications,” said Mr. Chan.
The US Department of Agriculture reported that El Niño could slow coconut oil exports due to reduced production.
Exports are expected to decline to 900,000 metric tons during the 2024 to 2025 market year, from 1.14 million MT last year.
Confederation of Coconut Farmers’ Organizations of the Philippines, Executive Director Charles R. Avila said that the increased demand for coco-diesel may not be adequately supplied by the industry, citing the limited yield due to the age of Philippine coconut trees.
“The legally expected increase in the biodiesel mix is one thing. “Coconut production, however, is obviously going down easily by 15% every year, so you can’t expect to meet the demand without sacrificing exports,” said Mr. Avila. BusinessWorld via Viber.
Axelum’s Mr Chan expects coconut production to be flat this year.
Coconut production reached 14.89 million metric tons (MT) in 2023, against the 14.93 million MT exported last year, according to the Philippine Statistics Authority.
“There is no substitute for a serious planting or replanting program,” said Mr. Avila.
In 2023, President Ferdinand R. Marcos, Jr. ordered the Philippine Coconut Authority (PCA) to draft a plan to revive the coconut industry, including planting 100 million coconut trees by 2028.
Under the Philippine Coconut Industry Development Plan 2024-2034, the replanting project is expected to increase coconut production by 4.7 billion nuts per year, worth P33.1 billion, by 2034.
This year, the PCA aims to plant 15.3 million trees, followed by 25.4 million annually between 2026 and 2028.
Mr. Avila said coconut farmers should play a major role in the government’s replanting efforts.
“We can dream about the exportation and the additional use of a thousand of coconut products – but the evidence suggests that the only thing that is certain is that the government denies coconut farmers their constitutional right to participate in programs that affect their welfare and development, which, of course, is a sure formula for failure in the end,” he added.
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