Bangkok: The Ministry of Commerce is urgently addressing the problem of low coconut prices after drought caused stunted growth and a surplus of coconuts. They are coordinating with coconut milk factories to purchase an additional 8.8 million coconuts and requesting cooperation in delaying coconut imports and prioritizing domestic use to absorb the surplus and stabilize prices for farmers. The ministry confirms that the problem is not primarily caused by imports, as import volumes in the first five months of the year have decreased by over 60%.
According to Thai News Agency, Mr. Kornnit Nonchui, spokesman for the Ministry of Commerce, revealed that the Ministry of Commerce, through the Department of Internal Trade and the Department of International Trade, has held discussions with coconut milk factory operators, importers, provincial commerce offices, and relevant agencies to urgently address the problem of low cooking coconut prices. They have requested cooperation from factories to prioritize purchasing domestic produce and to temporarily suspend coconut imports during periods of high domestic supply. Manufacturers have confirmed that they will reduce imports and primarily use domestically produced coconuts in the short term.
Mr. Kornnit stated that the Office of Agricultural Economics forecasts coconut production in 2026 to reach 852,000 tons, an increase of 2.4 percent from the previous year. However, the impact of the recent drought has resulted in coconuts being small or stunted, making them undesirable for the grated coconut market. Consequently, a large surplus of this produce is flowing primarily into processing plants.
While processing plants face production capacity limitations, they cannot accommodate all the produce entering the market simultaneously, resulting in a surplus of produce. Some wholesalers and factories have slowed down their purchases, causing the purchase price of cooking coconuts from farmers to drop to 6-7 baht per fruit.
Regarding concerns about coconut imports, Mr. Kornnit stated that investigations have revealed that coconut milk factories still use domestically produced coconuts as their primary raw material, accounting for 80% of their total, with only 20% imported. Furthermore, during periods of high domestic production, imports have consistently decreased.
Between January and May 2026, coconut imports totaled 79,388 tons, a decrease from the same period the previous year which saw imports of 190,734 tons, or a reduction of over 60 percent. This reflects that the current coconut price problem is not primarily caused by imports, but rather by an oversupply of coconuts entering the market, coupled with the impact of drought which resulted in stunted coconuts and difficulty in distributing them into the grated coconut market.
To alleviate the hardship faced by farmers, the Ministry of Commerce has implemented urgent measures for coconut milk factories to purchase the remaining 8.8 million coconuts. This includes 5 million coconuts from Prachuap Khiri Khan province, 1.6 million from Nakhon Si Thammarat province, 1 million from Surat Thani and Chumphon provinces, and 1.2 million from other areas.
The Ministry of Commerce expects that measures to accelerate purchasing and delay imports will help reduce the surplus of coconuts and allow the price of cooking coconuts to gradually return to normal as soon as possible. The ministry will also closely monitor the purchasing situation and coconut prices, as well as regulate imports to prevent them from affecting domestic production.
Furthermore, there are plans to promote Thai coconut milk factory operators to expand their markets both domestically and internationally, coupled with upgrading the production of farmers, farmer groups, and community enterprises to meet international standards, ensure continuous production, and be traceable, in order to increase the competitiveness of the Thai coconut industry in the global market.