UPDATE for COCONUT OIL and PALM KERNEL OIL Customers

13. November 2013

Coconut prices have increased quickly and extremely sharply in the past 2 days due to the extensive damage to Philipines coastal and inland growing regions. The size and intensity of the recent typhoon has had a massive impact on an extensive region covering 100’s of KM’s. The impact is serious and immediate: • ~22% of global output of Coconut oil comes from this region; hence the impact will be substantial and direct • processors and sellers in the origin are extremely worried about availability nearby and in the 1st half of 2014 • prices increased as much as 20% and possibly more prices rises can follow depending on the full impact of the devastation in the crop regions; it is too early to know at this stage. • it is also not clear yet, if further storms in the region could lead to further damage which would intensify the supply and price situation • As our graph below depicts, Palmkernel prices have also followed the general Coconut oil trend in the “lauric oils ” complex • OPW advises a close watch on demand and suggests contract cover for the comin 6-9 months to ensure supply / stocks are covered (this is for conventional and organic grades)

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