The coconut industry is the oldest agricultural industry in PNG and has played a significant economic and development role since the 1940s. However, the industry over decades has declined in its status and is now the fourth major commodity after oil palm, coffee and cocoa in terms of their contributions to the GDP of PNG.

The industry provides employment for 309,417 households (2000 National Population Census), representing 31% of total households in PNG. It is estimated that over two million people are involved either directly or indirectly in coconut cultivation, production and consumption in PNG. The main commercial product from the coconut palm produced by rural farmers is copra.

However, the price of copra is so low compared to other agriculture commodities such as cocoa and coffee. And for those in the remote islands of the major coconut producing provinces in PNG, rising transport costs to markets have further eroded farm-gate prices, and their economic survival is a matter of great concern.

Diversification of coconut products produced by the agriculture producers will not only enhance exports and bring in additional national revenue but it can also address the reduction of importation of coconut products and substitutes from overseas such as Asia. In the last two years, packaged coconut water has become a lucrative industry, competing against carbonated drinks. There are numerous opportunities within the coconut sector in which small-scale producers can value add coconut through product diversification, technology improvements and enhanced market access.

Plans are to increase area planted under coconut from 202,400 ha in 2016 to 204,800 ha in 2017 and to 207,200 ha in 2018 generating revenues of K64.7 million, K65.3 million and K71.1 million respectively from export of copra, copra oil and copra meal. Current awareness and training programs to diversify into non-traditional value-added coconut programs over the last few years has attracted a lot of interests among coconut farmers and key stakeholders in the industry and the future of the coconut industry is looking bright and promising.


Source: Extract from Ministerial Statement