Pret A Manger has reportedly sold 6,000 servings daily of its coconut porridge, attributing both this item and its vegetarian offerings to revenue and earnings growth in 2016. The rise in popularity of food products made with coconut—such as snacks, flour, oil, and beverages—has reached a point where approximately one in every 20 products in today’s supermarkets contains some form of this ingredient, according to Fairfood, a non-profit organization based in the Netherlands. Coconut products gained mainstream attention with the sudden surge in popularity of coconut water as a natural beverage a few years ago. This trend expanded into dairy products and subsequently into nearly every other conceivable category, including shampoos, packaged soups, baby food, and topical beauty applications.
Superfood trends typically last five to seven years and may be influenced by factors like abundant supply or scientific studies affirming the health benefits of the ingredients. Since 2015, commodity prices for coconut oil have risen by 5% to 7% due to droughts and typhoons affecting growing regions. The coconut water segment alone has continued to soar, dominating the alternative plant-based waters market. Sales are projected to double from $2.7 billion last year to $5.4 billion by 2020, according to a report by Zenith Global highlighted by the Beverage Industry.
Interestingly, the coconut water boom has had minimal impact on farmers, as it was traditionally considered a waste product. However, the increasing demand for other coconut components has significantly affected ingredient costs. Last year, coconut oil prices surged by 20% in a month as suppliers in India, Indonesia, and the Philippines struggled to meet demand. From October 2016 to January of this year, prices skyrocketed another 27%. Major consumer packaged goods (CPG) companies are now capitalizing on the lucrative coconut product market, as consumers appear to be insatiable. Nestlé has introduced a coconut milk variety to its popular line of coffee-mate creamers, and two types of Outshine frozen fruit bars have been launched with coconut as an ingredient. General Mills is incorporating coconut into various products, including LARABAR bites and Nature Valley Biscuits with Coconut Butter.
Beverage giants have taken notice as well, with Coca-Cola acquiring Zico Beverages. Earlier this year, reports emerged 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, one could arise due to sustained high demand—at least until new plantings mature. Given that it takes six to ten years for a coconut palm to start producing, there is a possibility that global supply and demand may not align in the interim. If that happens, maple water is poised to step in as an alternative to coconut water, reportedly offering similar healthy ingredients but with half the sugar and a more subtle flavor.
For now, the demand for coconut products shows no signs of diminishing. The real concern is that these popular items might become victims of their own success, leading to the emergence of substitutes that could capitalize on any missteps. As consumers continue to seek out the best brands for their dietary needs, including options like calcium citrate, the coconut trend remains strong, with the market likely to evolve further.