Coconut oil: Trading
No futures, so traders hedge with palm oil
What this tab covers How and where it is bought and sold: who buys and sells, exchanges and benchmarks, contract types, the big trading houses and how prices are discovered.No major futures contract exists for coconut oil. Trade runs on physical contracts between Philippine and Indonesian mills, refiners and oleochemical buyers, commonly quoted CIF Rotterdam, the basis of the World Bank series. Prices track palm kernel oil closely, and some participants cross-hedge with palm oil futures on Bursa Malaysia. Morgan describes how Cargill built a Philippine copra business, buying at its own dock and collecting from the islands by coastal vessel, then moved crushing from San Francisco to Iligan in 1970.
Where it is bought (buyers)
- EU (655 kt), US (440 kt) and Chinese (200 kt) oleochemical and food buyers import coconut oil (USDA 2025/26), mostly CIF Rotterdam or US Gulf/West Coast
- Indian oil mills and Marico buy copra in Kerala, Tamil Nadu and Karnataka markets; Kochi is the reference market
- Desiccated coconut and coconut water buyers in Europe, the US and the Middle East buy from Philippine, Indonesian, Sri Lankan and Indian processors
Where it is sold (sellers)
- Philippine and Indonesian mills sell crude coconut oil to refiners and traders
- Indian farmers sell nuts and copra to traders, mills and NAFED at MSP
- Sri Lanka and Vietnam export desiccated coconut and other products
Exchanges and benchmarks
| Venue | Contract | Notes |
|---|---|---|
| No liquid global futures | physical market | contracts are priced on CIF Rotterdam quotes; traders hedge with palm oil or palm kernel oil where possible |
| Bursa Malaysia | Crude Palm Oil futures (FCPO), 25 t | proxy hedge for tropical oils |
| India | none active | no copra or coconut oil futures on NCDEX or MCX; Kochi and Kozhikode market prices and the MSP are the references |
Contract types
- CIF Rotterdam crude coconut oil cargoes for forward shipment
- FOB Philippine or Indonesian ports
- Domestic copra contracts in India priced off Kochi market rates
Top trading houses
- Cargill
- Wilmar International
How prices are discovered
- World Bank Pink Sheet coconut oil (crude, CIF Rotterdam)
- Philippine and Indonesian FOB quotes from trade press
- Coconut Development Board daily and weekly Indian market prices