Observations of Southeast Asian Coconut Countries
Southeast Asia is home to a majority of the worlds organic coconut ingredient production. Three countries stand out in particular- Indonesia, Philippines, and Sri Lanka are notable not only because of their organic coconut ingredient production, but because of country specific idiosyncracies. Throughout our time in Southeast Asia, The Coconut Cooperative team has recorded general observations on each country. I’ll highlight some of the strengths and weaknesses of each country, and as a buyer, what to look for when sourcing from each country.
Coconut Sugar is the most popular coconut byproduct to come out of Indonesia. That isn’t to say that there isn't desiccated or coconut oil being produced, but there are several identifiable US brands sourcing coconut sugar from Indonesia. The proliferation of new, organic coconut sugar operations also makes prices competitive. But when sourcing from Indonesia, be wary of who you are speaking to. Are you speaking to an aggregator, or someone who works directly with farmers? Or are you speaking with a trader, someone who buys and sells from these aggregators. Buying from traders is more expensive than buying directly from aggregators, and quality is much more volatile (you might be buying organic coconut sugar that’s been cut with cane sugar). On the whole, we’ve noticed that farmers/aggregators from the region are less likely to be locked down by long term contracts, but be wary of who you speak to and about quality guarantees.
The Filipino organic coconut ingredient market is perhaps the most mature out of these three countries. Coconut sugar, desiccated coconut, coconut oil, and other products are all commonplace. Economies of scale have allowed these companies to mass produce coconut ingredients and in fact the larger companies in the Philippines have long supplied the United States market with both conventional and organic coconut products. But because of these long standing relationships, coconut ingredients from the Philippines are expensive and if you are a new buyer the chances of receiving bulk discounts is low.
Unlike Indonesia, where coconut sugar is the most recognizable coconut byproduct, Sri Lanka is known for its desiccated coconut and coconut oil. It is important to remember that producing coconut sugar is very different from producing desiccated coconut and coconut oil. In order to produce desiccated coconut, actual nuts must be harvested from the coconut tree. However, the production of coconut sugar involves cutting away the coconut blossom. Instead of harvesting the nut, a coconut sugar farmer will harvest the sap from the coconut blossom. That being said, Sri Lanka is similar to Indonesia in that it’s organic coconut ingredient market is relatively young and expanding quickly. For the buyer this means better pricing, but it also means an opportunity to be sure of quality standards.
As a final note, please note that on the whole, all parties that we have interacted with in these countries has been very positive. Indonesians, Filipinos, and Sri Lankans are all incredibly kind-hearted people. When we have made on-site visits, we have been treated with nothing but respect. But, just as there are bad apples in any country, there are those who are less than moral. As with any new supplier, ask for references, or others who can vouch for doing business with the group. At The Coconut Cooperative, we pride ourselves on working with farmers who share the same values as us. Honesty, transparency, and a passion for showcasing the finest coconut ingredients to the entire world.