Copra Value-Adding Activities

At each level in the value chain, there are secondary products and byproducts such as coconut husks, cake/meal for livestock, etc. The value chain incorporates many market intermediaries. The domestic market sub-sector uses many coconut products for food, fuel, and construction materials. The international market sub-sector includes traders and brokers, copra millers, buyers of coconut oils and meals, VCO buyers, and buyers of dry and drinking nuts.

Coconut growers use few purchased inputs other than hand tools and sacks. The majority are household units with 5-6 family members growing coconuts on customary land. Some grow in no commercial quantities but have 10-20 ‘personal’ palms. Others sell immature nuts for drinking, dry nuts for local consumption, dry nuts to copra processors or trade stores, or process their nuts into copra to sell to rural copra traders, copra mills, or copra exporters. Some also extract oil for massage and skin-care products. Increasing quantities of nuts are being sold to VCO operators but this still represents less than 1% of production, and great numbers are unused when copra prices are low. Almost all marketing channels are informal with no prior pricing or contractual agreements and no formal product
specifications.

Copra millers purchase and process copra to produce industrial crude coconut oil (CNO). There are four medium-sized mills and about ten smaller mills that produce less than one tonne daily. Mini-mill operators mostly sell their oil to the bigger millers. The CNO and the byproduct (copra cake or meal) are mostly exported, but small amounts go to the local market for body lotions and stock feeds. Two other millers also make soap for the local market, and several produce bio-diesel.

Virgin Coconut Oil (VCO) is being extracted in small decentralized processing facilities to produce a high-value oil for export and a byproduct used locally for livestock feed. Increased VCO production is prioritized because it extracts higher value from coconuts, and its decentralized production creates rural employment and boosts income. Local consumption is the most important coconut use after copra. A much smaller volume of nuts for consumption passes through local markets, but this provides an important livelihood for a significant number of vendors. Coconut sales in Honiara and other urban centers are informal at roadside stalls, urban markets, cafes, restaurants, and hotels. Coconut exporting is still developing with two operators exporting mature dry nuts to Australia.

Body oils and lotions from coconut oil are marketed locally. Women extract coconut oil by “boiling off” the oil from coconut milk or buying it from local copra crushing or VCO mills. They add perfumes, pack the oil in used plastic bottles, and sell it in markets.

Investing in certification

There are lots of types of certifications for copra and each of them provides an independent verification to buyers that your product has characteristics that are important to the buyer, thus they will be more open to buying your copra at a higher value. Some examples of certification are:

Fairtrade Certification: Fairtrade changes the way trade works through better prices, decent working conditions and a fairer deal for farmers and workers in developing countries. You can learn more here: https://fairtradeanz.org/

Rainforest Alliance: Rainforest Alliance certification helps farmers produce better crops, adapt to climate change, increase their productivity, and reduce costs. These benefits provide companies with a steady and secured supply of certified products. Sourcing Rainforest Alliance Certified products also helps businesses meet consumer expectations and safeguard their brand’s credibility. You can learn more here: https://www.rainforest-alliance.org/why-certification/

Organic Certification:
There are three ways to sell organic copra.

• If you farm organically but don’t have certification, you can get your copra tested for pesticide or chemicals etc. in a lab and use this as proof that your copra is chemical free.
• You can become organic certified though third-party accreditation. There are many companies that offer third party accreditation, including ACO, NASAA, EcoCert etc.
• You can become certified by your peers in a system called Participatory Guarantee System (PGS). You can find out more through PoetCom.

If you are interested in certification, make sure that you have an understanding of the overall costs, and see if it makes sense for your business.

Another certification that is well known and used as for quality assurance is the HACCP Certification. This certification is for copra or coconut-based products. It states that your product is up to standards to be exported and sold in supermarket shelves.