Coconut’s Existential Crisis: Meet the Innovators Saving It.

Coconut’s Existential Crisis: Meet the Innovators Saving It.?

Can Farmer Welfare and Sustainable Production Bring an End to the Coconut Wars?

Coco-controversial?

It’s impossible to talk about the coconut sector without talking about a 2020 study which bunched the sector’s coconuts and twisted them in a quagmire of controversy.

The study suggests that coconut plantations were causing five times as much biodiversity loss as palm oil. They claimed that, as coconuts are grown on tropical islands rich in biodiversity, the loss is greater per ton of coconut oil produced. The debate continues as to whether coconuts are, in fact, worse for biodiversity than the much maligned (misunderstood ) palm oil.

The industry got on the defensive. The Secretary-General of the Indonesian Coconut Processing Industry Association accused the studies’ authors of seeking to create a “negative campaign against coconuts.”?

So, Are Your Coconuts Clean?

In terms of sheer production, the coconut industry is at least 25 times smaller than palm. The impact on biodiversity is undoubtedly less overall: according to the IUCN , 321 species are threatened by palm oil, while coconut threatens 66.

The coconut industry isn’t blighted by the large-scale plantation level deforestation associated with other crops, as over 90% of farms are smallholder or family run. In sustainability terms, this means less land-use change and less deforestation.

Companies like Peter Paul have led the way in helping coconut farmers become trained and certified Fair Trade, so that they can earn more money for their products and invest in sustainability. However, a 2020 UN study has shown that the costs of organic certification are unrealistic for many smallholder farmers.

Coconuts are often planted among other crops, which makes it difficult to measure their impact alone. The crop’s a team player , which has its own advantages. Polycrop farms are good for the soil, for biodiversity, and emissions reductions…

…But the Industry’s Nut Okay.

The coconut industry is facing an edge-of-a-cliff disaster. The older trees become, the fewer coconuts they produce.?

Many of the trees currently producing coconuts were planted at the same time, and they’re producing fewer coconuts every year. That’s why Satelligence is helping Sime Darby age-map their coconuts in Papua New Guinea. Some of the oldest produce less than ten coconuts annually, which incentivises land-use change and, therefore, more deforestation. If old trees are not replaced, production in Asia could drop by 80% by 2027.

The EU’s agreement to phase out the use of palm oil biofuels by 2030 could mean that coconut biofuel, which is currently labelled a green energy source, begins to replace it. Expansion in the industry would again lead to tropical deforestation and biodiversity loss.

The rise in global demand for all things coconut means that coconut producers are flooding the market, and that means that smallholder wages are falling to abysmal rates.

The patchwork composition of the industry poses unique challenges, as its spasmodic composition undermines its leverage for research and innovation in sustainable practices, and for consistency in best practice across the sector. Engaging with farmers can be tricky as the coconut sector is, essentially, a loosely connected group of thousands of local and family-level operations. Massive, industry-wide sustainability reforms are a tough sell for smallholder farmers.

Sector-saving Satellites and the Sustainable Coconut Charter

Amid growing pressure for more sustainable production, greater supply and fairer wages, the coconut industry responded with the USAID backed Sustainable Coconut Charter . The Charter is a new commitment signed by a number of multinationals, including Unilever, AAK, Friesland Campina, Nestlé and Barry Callebaut, to sustainability in the coconut sector.?

The Charter hopes to tackle the sector’s concerns by incentivising coconut farmers to diversify their plantations, implement organic certification schemes, ensure full use of coconut by-products, and to consolidate the supply chain with local processing.?

Demand is outpacing supply, and the problem is getting worse as trees age, despite the sector growing by 1.3% on average per year in the Asia-Pacific region. But the sector is innovating, like with Unilever’s mini-coconut-trees , which are easier to harvest and mature faster. The Fair Trade Sustainability Alliance are training farmers in the Philippines in how to manage coconut-tree nurseries, and Philippines based Aluan are planning to re-plant 15,000 acres of coconut trees as 100% organic certified.

The Sustainable Coconut Charter would formalise projects like these under one umbrella, uniting and powering up an otherwise fragmented industry. To get the Charter off the ground, companies first need to know where they get their coconuts from, which is why Satelligence is helping companies keep track of tree location and age.

A growing body of evidence suggests that coconut crops make exceptional carbon sinks too. Satellite monitoring and carbon-counting algorithms attach value to sequestered carbon, so farmers can generate carbon credits and sell them to supplement their income.

Satelligence’s methodology is assured by E&Y, which means that farmers can be rewarded financially for emissions-thwarting measures. They can get more lucrative deals from the companies they sell to by reducing the deforestation on their scope 3 emissions portfolios. Safeguarding the livelihood of farmers and reducing scope 3 emissions on the carbon balance books of multinationals is a win-win for all. In fact, it may be the only way to save our coconuts.

To spend less time caught up in coco-controversy and more time reducing scope 3 emissions in your supply chain, get in touch .