Philippines Eyes Second Straight Year of Record Coconut Exports

Drought Looms Over Optimistic Forecast

The Philippines expects coconut exports to climb past $3.57 billion in 2026, building on a 34 percent surge the previous year, even as El Niño weather patterns threaten to squeeze production across the archipelago's palm-lined regions.

Joseph Cezar Deligero, head executive assistant at the Philippine Coconut Authority, told reporters the agency remains confident shipments will beat the 2025 record. "We are positive that we'll still be able to surpass our 2025 exports, although the coming El Niño might have an effect on our productivity, thus impacting also our exports," Deligero said.

The optimism stands against sobering production data. During the last El Niño cycle in 2024, coconut output fell roughly 20 percent as prolonged dry spells stressed trees and reduced nut yields. The Philippine Statistics Authority recorded total coconut product exports of $3.57 billion in 2025, up from $2.66 billion the year before.

Irrigation and Planting Materials Scale Up

The PCA has begun distributing planting materials to farming cooperatives in major coconut-producing provinces, an effort to offset potential harvest shortfalls. Deligero noted the agency is working alongside 15 implementing bodies under the Coconut Farmers and Industry Development Plan to coordinate drought response measures.

Solar-powered drip irrigation systems have been deployed in select areas to maintain soil moisture during periods of reduced rainfall. The technology aims to keep young palms alive and mature trees productive when monsoon patterns weaken under El Niño influence.

Coconut cultivation spans more than 3.5 million hectares in the Philippines, with smallholder farmers accounting for the majority of production. The sector employs an estimated 25 million Filipinos directly and indirectly, making it a cornerstone of rural livelihoods in Mindanao, the Visayas, and southern Luzon.

Pest Pressure Rises With Heat

Higher temperatures associated with El Niño also create favorable conditions for the Coconut Scale Insect, locally known as cocolisap. Deligero warned that hotter, drier weather could trigger pest infestations capable of damaging plantations at scale. "With the threat of the super El Niño, we're anticipating that our pest infestation will increase," he said.

The PCA has ramped up integrated pest management programs, training farmer groups to identify early signs of infestation and apply biocontrol agents. Left unchecked, cocolisap can weaken trees, reduce yields, and in severe cases kill palms outright.

The insect emerged as a significant threat in several provinces during previous drought years, prompting emergency eradication campaigns and quarantine measures. This time, authorities are moving preemptively to contain outbreaks before they spread.

Export Markets Hold Steady

Philippine coconut products, including copra, coconut oil, desiccated coconut, and fresh nuts, flow primarily to the United States, European Union, China, and other Southeast Asian markets. Demand for coconut-based ingredients in food manufacturing, cosmetics, and biofuel has remained robust, insulating the sector from some of the volatility affecting other agricultural commodities.

Coconut oil prices on international markets have stayed relatively firm, supported by supply constraints in competing origins such as Indonesia and steady industrial offtake. The Philippines holds roughly one-third of global coconut oil trade, giving it significant pricing influence.

Industry groups have pushed for value-added processing capacity within the country to capture more margin, rather than exporting raw copra and semi-processed goods. Government incentives for mid-scale processing plants have begun to take effect, though infrastructure and logistics gaps persist in rural areas.

Balancing Growth and Climate Risk

The PCA's forecast hinges on weather patterns evolving less severely than some meteorological agencies predict. If rainfall deficits prove deeper or more prolonged than in 2024, production declines could outpace the agency's mitigation efforts.

Export momentum may also depend on the global economic backdrop. A slowdown in key buyer markets or shifts in consumer preferences toward alternative oils could dampen demand, even if Philippine supply holds up.

For now, the combination of strong 2025 carryover momentum, proactive irrigation deployment, and stable international prices underpins the agency's outlook. Whether that proves sufficient to offset El Niño's drag will become clear as the dry season deepens in the coming months.