Sri Lanka is not only the world’s fourth-largest coconut product exporter but also one of the best in the world. In 2020, Sri Lanka’s total export earnings from coconut products were USD 664.58 Million whereas it had been USD 613.84 million in 2019. In fact, over the past decade, Sri Lanka’s export performance (in value) had steadily been on the rise, which partly explains the growing demand for coconut-based products exported from Sri Lanka.
The global coconut products industry was pegged at $12.75 billion in 2019 and is projected to reach $31.1 billion by 2026, registering a Compound Annual Growth Rate (CAGR) of 13.6% from 2019 to 2026, according to a research report released by Allied Market Research. The processed coconut products supplied from Sri Lanka mainly include desiccated coconut, coconut oil and virgin coconut oil, liquid coconut milk, coconut cream, coconut milk powder, coconut flour and coconut water.
Sri Lanka caters to 1.33% of the global demand for coconut oil at an export value of USD 62.7 Million. The main importers of coconut oil from Sri Lanka are the USA, Australia, Germany, Saudi Arabia, the UK and Netherlands. The coconut oil segment held the lion’s share in 2019 accounting for around half of the global coconut products market since coconut oil is a widely used ingredient in the food and beverage and personal care product industry across the globe.
Virgin Coconut Oil (VCO) is the newest high-value coconut product, which is in high demand in the global market as a functional food with high nutritional value and health benefits. With the increasing global demand for VCO, Sri Lankan coconut oil manufacturers have adopted the production of Virgin Coconut Oil for the global market to meet the growing demand.
The global desiccated coconut market revenue stood at USD 4602 million in 2019 and is projected to be USD 6304 million in 2025, with a CAGR of 5.38% during 2021-2025. Desiccated coconut is a dried (a maximum of 3% moisture content), grated and unsweetened fresh kernel or meat of a coconut’s mature fruit. It’s derived from coconut which is predominantly grown in Southeast Asian countries such as Sri Lanka and is traded worldwide.
Since desiccated coconut is used in food industries such as bakery, confectionery, culinary, beverages etc., the growth in demand for desiccated coconut bears a high correlation with the performance of these processed food industries. Noted for its low cholesterol or trans-fat content while rich in a variety of essential nutrient contents including dietary fibre, copper, manganese and selenium, the desiccated coconut has seen rising popularity in the global market.
Sri Lanka’s desiccated coconut is very popular in the international markets due to its distinct white hue, rich taste, and texture. As a result, there’s a high demand for desiccated coconut exports from Sri Lanka.
The global coconut water market size was valued at USD 4.27 billion in 2019 and is projected to expand at a compound annual growth rate (CAGR) of 16.1% from 2020 to 2027. Over the past few years, people worldwide have been increasingly adopting several healthy and nutritional drinks to maintain a healthy lifestyle.
Why, because several chronic health problems such as obesity, cardiovascular diseases, and diabetes in people from all walks of life across all social classes have been blamed on the excessive consumption of sugary and carbonated beverages. As a result, coconut water is recognised as a healthy alternative to carbonated beverages. This phenomenon is going to be favourable for Sri Lankan coconut water exporters.
The global coconut milk market was valued at USD 1.1 Billion in 2019 and is anticipated to reach USD 2.9 Billion by 2027, with a CAGR of 17.1% during the forecast period. The rate of consumption of coconut milk products is anticipated to rise significantly throughout the forecast period as a result of the health benefits to be gained from coconut milk. Also, coconut milk is found in a wide range of processed foods including cookies, cakes, pies, soups, milkshakes, and ice cream.
The rising urban population will drive the demand for such processed products. The global demand for coconut milk is also driven by the growing interest in natural food products, vegan diets, and Asian cuisine in which coconut milk is a core ingredient. Sri Lankan coconut milk exporters too stand to gain from the forecast growth in demand.
The major markets for desiccated coconut, liquid coconut milk, virgin coconut oil and coconut cream exported from Sri Lanka in 2020 were the USA and Western Europe. The table below shows the emerging markets for processed coconut products and the growth in USD dollar export value between 2019 and 2020. This also corroborates the massive export potential for processed coconut products from Sri Lanka.
The global activated carbon market was valued at USD 2,856.7 million in 2019 & is projected to reach USD 4,064.7 million by 2027, exhibiting a CAGR of 4.8% during the forecast period. Activated carbon, also known as activated charcoal, is used in a wide range of industrial applications that include gas and air cleaning involving reusable recovery.
Escalating environmental concerns and awareness have led to stringent emissions guidelines which have, in turn, egged manufacturers on to invest in technology development and advanced concepts for the use of activated charcoal in applications such as cleaning and air treatment. It's also increasingly used for water treatment that includes drinking water, service water, groundwater, and wastewater.
These have been crucial demand drivers for activated carbon across the globe. This presents Sri Lankan activated carbon exporters with an enormous opportunity to penetrate new markets.
The coco coir market size was valued at $369.70 million in 2019 and is anticipated to reach $525.70 million by 2027, registering a CAGR of 8.2% from 2020 to 2027. Coco coir, also called coco-fibre, is a stiff, coarse natural fibre, flexible natural yarn that is obtained from the outer husk of the coco manually or through machines. Growth in demand for eco-friendly products with lightweight properties coupled with the expansion of the upholstery industry is driving the growth of the global coconut coir market.
The process of extracting coco-fibre from coconut husk also produces an important by-product called coco peat or coir pith, which has gained significant traction in the coco coir market, since it is used as a growth medium in horticulture. The surge in demand for coir and coco peat-based products spells a valuable growth opportunity for coir based and coco peat-based product manufacturers and suppliers from Sri Lanka. skincare How to enhance the export potential of coconut and coconut-based products from Sri Lanka?
Removing supply chain bottlenecks to ensure a steady supply of raw material