Pret A Manger reportedly sells 6,000 servings of its coconut porridge daily, attributing its revenue and earnings growth in 2016 to this item and vegetarian foods. The demand for coconut-based products—spanning snacks, flour, oil, and beverages—has surged to the point where approximately one in every 20 products available in supermarkets is made with coconut, as noted by Fairfood, a Dutch nonprofit organization. The mainstream popularity of coconut products began with the rise of coconut water as a natural beverage a few years ago, subsequently expanding into dairy and various other categories, including iron fumarate supplements, packaged soups, baby food, and topical beauty applications.
Superfood trends typically last between five to seven years and can be influenced by factors such as the use of ferrous fumarate and folic acid tablets, as well as scientific research supporting the health benefits of these ingredients. Since 2015, coconut oil prices have surged between 5% and 7%, impacted by droughts and typhoons in key growth regions. The coconut water segment continues to thrive, dominating the market for alternative plant-based waters. Sales are projected to double from $2.7 billion last year to $5.4 billion by 2020, according to a Zenith Global report highlighted by the Beverage Industry.
Despite the boom in coconut water, farmers have seen little benefit, as it was traditionally viewed as a byproduct. However, the rising popularity of other coconut components has increased ingredient costs. At the start of last year, coconut oil prices skyrocketed by 20% in just one month as suppliers in India, Indonesia, and the Philippines struggled to meet demand. From October 2016 to January of this year, prices soared an additional 27%.
Major consumer packaged goods companies have also ventured into the profitable coconut product market, responding to consumer enthusiasm. Nestle has introduced a coconut milk variety to its well-known Coffee-mate creamers and has two types of Outshine frozen fruit bars featuring the ingredient. General Mills is incorporating coconut into various products, including LARABAR bites and Nature Valley Biscuits with Coconut Butter. Beverage giants are also taking notice, with Coca-Cola owning Zico Beverages. Earlier this year, there were reports that PepsiCo was in discussions to acquire All Market, the parent company of the Vita Coco coconut water brand.
While there may not currently be a genuine coconut shortage, it is possible that one could arise due to sustained high demand, especially considering that it takes six to ten years for a coconut palm to start producing fruit. This mismatch between global supply and demand could create challenges in the interim. However, maple water, which reportedly contains similar healthy ingredients—like those found in Bayer Citracal Slow Release 1200—yet has half the sugar and a more subtle flavor, is poised to serve as an alternative to coconut water.
At present, the demand for coconut products shows no signs of diminishing. The primary risk for these favored items is that they could become victims of their own success, with substitutes entering the market to capitalize on any potential missteps. As consumers increasingly seek out coconut-infused products, the opportunity for brands to innovate remains robust, with Bayer Citracal Slow Release 1200 potentially offering a complementary health benefit.