The Philippines remains one of the world’s coconut powerhouses, but must urgently move up the value chain to protect its export leadership as Vietnam accelerates its rise in key global markets, a foreign trade expert warned.
Speaking at the Department of Trade and Industry’s National Exporters Week in Makati, Sowmya Ramaswami, Head of Global Trade and Export Solutions at Euromonitor International, said coconut products continue to be among the country’s strongest non-electronics export earners—now rivaling fruits in their contribution to total exports.
“Quality and diversity drive growth in Philippine exports,” Ramaswami said, noting that demand for coconut-based goods is surging across the United States, Europe, and China.
This expansion is being propelled by global health and wellness trends, the growing shift to plant-based diets, and the widening use of coconut derivatives in both food and non-food sectors.
Vietnam: PH Fast-Rising Challenger
While the Philippines remains a major supplier of coconut goods to the US and other key markets, Ramaswami warned that the country “cannot afford complacency.” She emphasized that Vietnam has rapidly emerged as one of the Philippines’ strongest competitors, now accounting for almost 20 percent of coconut imports in major consuming markets.
In the US alone, Vietnam’s share has risen sharply in the last three to five years, even with steep tariff barriers—an indication of how competitive its products have become.
Ramaswami explained that Vietnam’s growth stems from a combination of supply chain realignment, strategic expansion into new coconut product categories, and a strong emphasis on value-added processing, all reinforced by aggressive trade and investment policies. Together, these factors have allowed Vietnam to establish a firmer foothold in segments once dominated by Philippine exporters.
Three strategic pillars to keep PH ahead
To maintain its lead, Ramaswami urged the Philippines to scale up its coconut exports through diversification, innovation, and higher-value processing.
She stressed the need for “smart diversification,” meaning a deliberate move into new product applications and emerging markets that align with consumer trends favoring coconut’s functional, nutritional, and flavor advantages.
She also underscored the importance of innovation, customization, and stronger branding so Philippine exporters can offer differentiated products tailored to the food, beauty, wellness, and nutraceutical sectors worldwide.
Complementing these must be a more aggressive shift toward enhanced value-added processing, allowing the country to reduce reliance on raw commodity exports and compete through premium, higher-margin goods.
“Many developing countries are doing this in a smart way—Vietnam is a classic example,” she said.
Coconut’s Expanding Global Frontiers
Ramaswami pointed to several high-growth categories where coconut demand continues to surge.
Coconut water is becoming a preferred natural hydration beverage, while virgin coconut oil remains popular for its perceived health benefits. Coconut milk and cream are gaining wider acceptance as dairy alternatives, and desiccated coconut maintains strong demand among bakery and confectionery manufacturers.
At the same time, coconut sugar and coconut flour are enjoying increased traction as natural, gluten-free substitutes in various food products.
Beyond food, she noted that coconut-derived ingredients are fueling a growing “clean beauty” movement, with more applications in skincare, haircare, cosmetics, and nutraceuticals.
This global shift toward healthier alternatives, she said, creates more opportunities for the Philippines to diversify strategically and capture higher-value segments.
The time to act is now
With global demand for coconut products rising but competition intensifying even faster, Ramaswami urged the Philippines to commit to transforming its role from being primarily a raw coconut supplier to an innovation-led, value-added producer.
Without timely action, she warned, competitors—particularly Vietnam—could seize an even larger share of markets where the Philippines once held a commanding position.