The way forward to sustainable coconut supply chains

THE COCONUT palm is dubbed the tree of life not only for the variety of products that can be made from it but also for the range of livelihoods that it can support. Given that the coconut industry has a bountiful multi-product structure encompassing thousands of value-added products, it has been providing income and job opportunities to more than 30 million farmers (over 90% of the coconut farms are smallholdings of less than a hectare in size) and workers from around 95 countries worldwide, with a total Global Export Value of nearly 10 billion in 2018.

The top five coconut-producing countries are India, Indonesia, the Philippines, Brazil, and Sri Lanka.  Based on data from the Asia and Pacific Coconut Community/International Coconut Community (APCC/ICC), India has been the leading producer of coconut followed by Indonesia and the Philippines, since 2018.  Production growth in India was brought about by improvement in farm productivity and expansion of area planted to coconut.

In recent years, coconuts and their derivatives have been increasingly regarded as beneficial to human health and wellness and this has led to strong growth in demand for both raw materials and value-added products especially in the international market. Parallel to this, there is a keener interest in products produced sustainably along the principles of the circular economy, biomimicry, and Industry 4.0 which are very much applicable to coco husk and coco shell based industrial products.

These facts from the coconut industry in the Philippines show how important the sector is for a producing country:

• Coconut is one of the two agricultural commodities that earns the country more than a billion dollars in export revenues every year.
• The industry provides livelihood opportunities to 3.4 million farmers and workers
• Around 3.5 million hectares are planted (about 26% of total agricultural land)
• 68 out of 81 provinces are coconut-growing areas
• About 343 million bearing trees deliver 15 billion coconuts production per year or about 45 coconuts per year per tree
• Registered traders and manufacturers are at about 7,773
• Top agricultural export, averaging USD FOB 1.82 billion from 2012-2017
• Coconut oil is the country’s top agricultural export as well as the only agricultural export that reached the Billionaires’ Club Export Category according to the Department of Agriculture (DA) and the Philippine Coconut Authority (PCA).

However, the boom in demand for coconut products during the recent years has not translated into increased production because diseases, natural disasters, and ageing trees kept global production stagnant over the past decade.  As per statistics from the Asian and Pacific Coconut Community (officially named as International Coconut Community, ICC since August 2019), world production of coconut increased at a measly rate of 0.55% per year during the period 2008 to 2017.

Given these circumstances, several interventions and projects have been designed and implemented to support the development of the coconut sector worldwide, taking the case of the Philippines as one of the leading countries in the implementation of pilot initiatives and projects to promote the adoption of better practices towards the achievement of its sustainable management. In this regard, and with the general objective of further promoting the inclusive and sustainable development of the coconut industry, a series of international and national events were held again in the Philippines during August and September 2019.

55th International Coconut Session and the Ministerial Meeting

What I would like to call from now on as “The Coconut Journey” that I’ve proudly been part of and supporting during the past four years, began this year coincidentally with the 55th International Coconut Session and the Ministerial Meeting, organised by the International Coconut Community (ICC), the Department of Agriculture (DA), and the Philippine Coconut Authority (PCA), and hosted by the Philippine government.

Held at the Philippine International Convention Center in Pasay City (25-31 August 2019), the event celebrated the golden anniversary of the International Coconut Community (formerly Asian Coconut Community/Asian and Pacific Coconut Community). The ICC was established in 1969 to promote, coordinate, and harmonise all activities seeking to achieve the maximum economic development of the coconut industry in coconut growing countries.

2nd World Coconut Congress

The next event was the 2nd World Coconut Congress (WCC) where more than 500 players, stakeholders and decision makers representing the coconut sector around the world gathered for three days to analyse, share and exchange the latest trends and developments in the industry. At the same time, the debates and the exchange of experiences obtained in more than 25 coconut-producing countries enabled them to design and establish sustainable objectives, as well as to craft the way forward to achieve them. 

The WCC is fast becoming the venue for lively discussions among industry players, led by a stellar lineup of global industry experts tackling topics such as: coconut production and value chain • non-traditional coconut products • lauric oleochemicals and new technologies • coconut solutions for health, food, industry & environment • blockchain technology • the latest on coconut oil health research • marketing coconut food products: strategies for success • how coconut oil improves blood chemistry • coconut biodiesel

33rd Cocoweek and its Trade & Investment Forum

The WCC was then followed by the 33rd Cocoweek and its Trade & Investment Forum, which was designed and executed by the PCA. This two-day forum provided the venue for all players and stakeholders in the Philippine coconut industry to identify potential opportunities for collaboration, taking into consideration major challenges faced along the different coconut value chains.

The trade and investment event focused on three value chains: young coconuts (locally known as buko); charcoal and activated carbon; and copra coconut oil. More than 250 participants comprised mostly of farmers and farmers groups (associations and cooperatives) participated in each of these events. Other participants included intermediaries, processors/manufacturers, and representatives from the local government units, national government agencies, development partners, and service providers.

SCNO Learning & Partnership Event

The Sustainable Certified Coconut Oil Production (SCNO) Learning & Partnership Event. SCNO is a project implemented by the PCA together with the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, and in partnership with the private sector including Cargill Oil Mills, BASF, and Procter and Gamble through SCNO.

The key objective of the SCNO Learning & Partnership Event and its Panel on “Enhancing Sustainability in Coconut Sector", was to trigger in-depth discussions among partners and participants on which efforts are needed beyond SCNO to strengthen the coconut sector. Experiences and actions taken by different donor agencies, private and public sectors, and experts from the field served also as learnings from capacity development approaches to increase public awareness and to agree on potential support to the coconut sector for the inclusive and sustainable development of the Philippine coconut industry.

In general, for the Global Coconut Sector, and specially for the Philippine Coconut Industry to take advantage of those market opportunities and, consequently, contribute to improving the living conditions of coconut farmers and workers, it has to contend with issues critical to improving and sustaining its competitiveness. Markets are increasingly concerned with the specifications of both products and processes further back along the value chain in a number of different ways, including quality and safety - based upon product and process controls;  conformance with social and environmental standards; traceability and authenticity; reliability and guaranteed supply in order to avoid stockouts; just-in-time delivery; and product differentiation and innovation as a means of adding value and margins.

In moving forward, these multi-stakeholder dialogues and policy coherence advance the coconut industry in many ways. They foster a more conducive environment for facilitating better and effective coordination between central and local government structures; strengthen public and private sectors collaboration, as well as partnerships with community-based groups and other civil society organisations.

On the other hand, further convergence and synergies need to be facilitated to address development challenges and achieve integrated solutions from the different government agencies. This is necessary to address development challenges that are shared and interrelated, to promote sustainability and inclusive growth along the different value chains in the coconut sector, that in turns will attract more sustainable and inclusive investment development opportunities.

There is still a long way to go before the whole coconut sector becomes completely sustainable and inclusive, but the path has been paved through these initiatives. Our advocacy and e-campaign to help raise more awareness and to promote further adoption of best practices towards the Sustainable Coconut Value ad Supply Chains Management is a never-ending endeavour, and will continue to grow and expand, thanks to the commitment to sustainability and inclusiveness expressed through the support from all players and stakeholders, as well as from "e-supporters" to these noble cause, initiatives and projects through the following link: https://www.linkedin.com/pulse/32nd-national-coconut-week-celebration-1st-world-congress-ivan-idrovo.