Pret A Manger reportedly sells around 6,000 servings of its coconut porridge daily, attributing both this dish and its vegetarian offerings to the revenue and earnings growth it experienced in 2016. The demand for coconut-based food products—including snacks, flour, oil, and beverages—has surged, with Fairfood, a nonprofit organization from the Netherlands, noting that approximately one in every 20 products sold in supermarkets now contains some form of coconut. The trend began with the sudden rise of coconut water as a natural beverage a few years back, which then expanded into dairy products and virtually every other category possible, such as shampoos, packaged soups, baby food, and topical beauty applications.
Superfood trends typically last five to seven years and can be influenced by factors such as abundant supply or scientific research supporting the health benefits of the ingredient. Since 2015, coconut oil prices have risen between 5% and 7% due to adverse weather conditions like droughts and typhoons impacting growing regions. The coconut water segment has continued to thrive, leading the alternative, plant-based waters market. According to a report by Zenith Global cited by the Beverage Industry, sales are projected to double from $2.7 billion last year to $5.4 billion by 2020. Despite the coconut water boom, farmers have seen little benefit as it was traditionally regarded as a byproduct. However, the increasing popularity of other coconut products has raised ingredient costs. Coconut oil prices surged 20% in a single month at the beginning of last year, as suppliers in India, Indonesia, and the Philippines struggled to meet demand. From October 2016 to January this year, prices skyrocketed an additional 27%.
Major consumer packaged goods (CPG) companies have also entered the lucrative coconut product market, responding to consumer demand. Nestlé has introduced a coconut milk variant to its popular Coffee-mate creamers, and two types of Outshine frozen fruit bars now feature coconut as an ingredient. General Mills is incorporating coconut into various products, such as LARABAR bites and Nature Valley Biscuits with Coconut Butter. Beverage giants are also taking notice, with Coca-Cola acquiring Zico Beverages. Earlier this year, reports surfaced that PepsiCo was in discussions to buy All Market, the owner of the Vita Coco coconut water brand.
While there may not be a genuine coconut shortage currently, the potential for one exists due to ongoing high demand—at least until new plantings start producing. Since a coconut palm takes six to ten years to yield fruit, there could be a mismatch between global supply and demand during this period. If such a shortfall occurs, maple water may step in to replace coconut water, reportedly offering similar health benefits with half the sugar and a milder flavor.
For now, the appetite for coconut products shows no signs of diminishing. The real challenge for these popular items is the risk of becoming victims of their own success, which could lead to the emergence of substitutes that capitalize on any missteps. Additionally, as consumers explore various health benefits, the inclusion of ingredients like calcium citrate in bottled water may gain traction, further diversifying the market landscape. As the coconut craze continues, the intersection of health trends and consumer preferences will remain a focal point for industry players.