# Coconut oil: Extraction

From nut to copra on a tropical smallholding

Source page: https://www.materialinsights.org/commodities/coconut/extraction/

What this tab covers How it is mined, drilled or grown, and processed into a tradeable form: the main methods compared, their unit economics, by-products, and the companies that do this work globally and in India.

Coconut palms grow on humid tropical coasts and islands, mostly on smallholdings rather than estates. Trees take several years to bear and then yield for decades, so planting decisions echo for a generation. Farmers split the nuts and dry the white meat into copra, by sun, smoke or kiln. Copra is crushed and expelled to give crude oil and a protein-rich meal used as feed. Crude oil is refined, bleached and deodorised, or split into lauric fatty acids. Coconut oil competes closely with palm kernel oil, the other lauric oil.

Coconut is a tropical palm grown mostly by smallholders in the Philippines, Indonesia, India, Sri Lanka, Vietnam and the Pacific. There are few estates. Supply responds very slowly because palms take years to bear and many plantations are old. Output reaches the market in three forms: fresh nuts, copra crushed into oil, and wet-processed products such as desiccated coconut, coconut milk and virgin oil. Husks and shells feed coir and charcoal industries. Yields vary widely, from about 3.9 t/ha of in-shell nuts in the Philippines to 16.9 t/ha in Brazil's irrigated dwarf plantations (FAOSTAT 2024).

#### Methods compared

| Method | Share of supply | Typical scale | Recovery / efficiency | By-products | Unit cost |
|---|---|---|---|---|---|
| **Smallholder copra production (Philippines, Indonesia, Pacific)** | Philippines 38.8% and Indonesia 20.7% of world coconut oil output in 2023 (FAOSTAT) | Philippines 3.73 million ha in 2024 (FAOSTAT); copra output 2.6 Mt in 2025/26 (USDA) | nut yield 3.88 t/ha (Philippines) and 6.38 t/ha (Indonesia) in 2024 (FAOSTAT); oil recovery from copra 63% (USDA PSD) | copra meal, husks, shells | n/a |
| **Smallholder fresh-nut and copra farming in India (Kerala, Tamil Nadu, Karnataka, Andhra Pradesh)** | India 31.24% of world nut production (2024-25, Ministry of Agriculture) and 17.6% of world coconut oil output in 2023 (FAOSTAT) | 20,301 million nuts from 2.19 million ha in 2024-25; Kerala 5,150 million nuts from 0.75 million ha | 9,249 nuts/ha (2024-25, Ministry of Agriculture) | coir, shell charcoal, copra cake | Copra MSP for 2026: milling copra Rs 12,027/quintal, ball copra Rs 12,500/quintal; cost of cultivation not found in sources used |
| **Wet processing: desiccated coconut, coconut milk and cream, virgin coconut oil, coconut water** | n/a | n/a | n/a | coconut residue (for feed or flour), shells for charcoal | n/a |
| **Irrigated dwarf and hybrid plantations (Brazil, parts of India)** | Brazil 3.16 Mt of in-shell nuts in 2024, about 4.8% of world output (FAOSTAT, derived) | Brazil 0.19 million ha (FAOSTAT 2024) | 16.9 t/ha in Brazil (FAOSTAT 2024) | husks and shells | n/a |

#### How each method works
**Smallholder copra production (Philippines, Indonesia, Pacific)**

Farmers or village traders split mature nuts and dry the meat in the sun, over smoke or in simple kilns to make copra. Copra is sold through layers of buyers to oil mills, which press it into crude coconut oil and sell it to refiners or exporters. Prices at the farm follow CIF Rotterdam oil prices with a lag.

Low-cost, but ageing palms, typhoons and drought (the Philippines' oil output fell to 1.64 Mt in 2025/26 from 1.79 Mt, USDA) keep supply erratic.
 FAOSTAT 2023-2024; USDA PSD, October 2026 **Smallholder fresh-nut and copra farming in India (Kerala, Tamil Nadu, Karnataka, Andhra Pradesh)**

Small family holdings sell fresh nuts to traders and temples, tender nuts to vendors, and the rest as milling or ball copra to oil mills. Kerala has the largest area; Tamil Nadu leads in output and Andhra Pradesh in productivity. The Coconut Development Board funds planting, replanting and processing.

High yields per hectare and strong domestic demand, but small holdings, old palms, root wilt disease and labour scarcity for climbing limit output.
 PIB backgrounder, 18 August 2026; FAOSTAT 2023 **Wet processing: desiccated coconut, coconut milk and cream, virgin coconut oil, coconut water**

Fresh kernel is grated and dried into desiccated coconut, pressed for coconut milk and cream, or processed without heat into virgin coconut oil. Coconut water is filtered, sterilised and packed. These plants need fresh nuts within days of harvest and food-safety certification for export, so they cluster near producing areas in the Philippines, Sri Lanka, Indonesia and south India.

Higher value per nut than copra, but needs reliable fresh supply and food-safety certification.
 Qualitative; PIB backgrounder, 18 August 2026 (product list) **Irrigated dwarf and hybrid plantations (Brazil, parts of India)**

Dwarf and hybrid varieties are planted at higher density under irrigation and fertiliser. They bear earlier than tall palms and give many more nuts per hectare. Most of the output is sold as tender coconuts and packaged coconut water rather than copra, so these farms serve the fresh market rather than the oil market.

Much higher yields, but needs water and capital and serves mainly the fresh market.
 FAOSTAT 2024 Unit economics are indicative ranges from the sources named; costs vary widely by deposit, region and year.

#### Who does it: global

| Company | Country | Activity | Volume | Year | Source |
|---|---|---|---|---|---|
| **Philippine coconut oil millers and refiners (aggregate)** | Philippines | largest exporter of coconut oil | 1.2 Mt oil exported | 2025/26 | [USDA PSD, October 2026](https://apps.fas.usda.gov/psdonline/) |
| **Indonesian coconut oil producers (aggregate)** | Indonesia | second-largest exporter | 0.63 Mt oil exported | 2025/26 | [USDA PSD, October 2026](https://apps.fas.usda.gov/psdonline/) |
| **Cargill** Private company; volumes not published | US | coconut oil refining in the Philippines; lauric oils trading | not published | 2025 | not available |
| **Wilmar International** Coconut oil volume not published separately | Singapore | lauric oils and oleochemicals | 26.4 Mt tropical oils sales volume (palm, lauric and others) | 2025 | [Wilmar FY2025 results briefing presentation](https://links.sgx.com/1.0.0/corporate-announcements/PYS9LAOYNCGL6401/876240_Wilmar%20FY2025%20Financial%20Results%20Briefing%20Presentation.pdf) |
| **Franklin Baker** Private company; volumes not published | Philippines | desiccated coconut, coconut milk and water | not published | 2025 | not available |

#### Who does it: India

| Company | Country | Activity | Volume | Year | Source |
|---|---|---|---|---|---|
| **Indian coconut growers (aggregate)** | India | production | 20,301 million nuts from 2.19 million ha | 2024-25 | [Ministry of Agriculture via PIB backgrounder, 18 August 2026](https://static.pib.gov.in/WriteReadData/specificdocs/documents/2026/aug/doc2026818961601.pdf) |
| **Coconut Development Board** | India | development agency: planting, replanting, export promotion | 7,038 Rs crore coconut product exports ($794.7 million) | 2025-26 | [PIB backgrounder, 18 August 2026](https://static.pib.gov.in/WriteReadData/specificdocs/documents/2026/aug/doc2026818961601.pdf) |
| **Marico (Parachute)** Copra purchase volume not found in sources checked | India | leading branded coconut oil packer (hair and edible oil) | not published | FY2026 | not available |
| **NAFED** Procurement volume not found in sources checked | India | copra procurement at MSP | not published | 2026 | not available |
| **KERAFED** Volume not found in sources checked | India | Kerala cooperative coconut oil (Kera brand) | not published | 2025-26 | not available |

India is the largest producer of nuts (31.24% of world output in 2024-25) but third in coconut oil, because most nuts are eaten fresh. It is nearly self-sufficient in coconut oil (570 kt output, about 1 kt of imports in 2025/26, USDA) and exports products worth $794.7 million (2025-26), led by activated carbon. About 30 million people depend on the sector, 10 million of them farmers (PIB).

## Other sections

- [Summary](https://www.materialinsights.org/commodities/coconut/index.md)
- [Overview](https://www.materialinsights.org/commodities/coconut/overview/index.md)
- [Correlation](https://www.materialinsights.org/commodities/coconut/correlation/index.md)
- [Production](https://www.materialinsights.org/commodities/coconut/production/index.md)
- [Stocks](https://www.materialinsights.org/commodities/coconut/stocks/index.md)
- [Cycles](https://www.materialinsights.org/commodities/coconut/cycles/index.md)
- [Trading](https://www.materialinsights.org/commodities/coconut/trading/index.md)
- [Movement](https://www.materialinsights.org/commodities/coconut/movement/index.md)
- [Criticality](https://www.materialinsights.org/commodities/coconut/criticality/index.md)
- [Characteristics](https://www.materialinsights.org/commodities/coconut/characteristics/index.md)
- [Emissions](https://www.materialinsights.org/commodities/coconut/emissions/index.md)
- [Relationships](https://www.materialinsights.org/commodities/coconut/links/index.md)