Coconut millers oppose approval of new capacities

• Desiccated coconut millers say new factories will hamper growth of existing biz
• Insist on having greater percentage of coconut available for export purposes
• Waste coconut material amounts to Rs. 29 b annually, calls on Govt. to take corrective steps to educate consumers

By Charumini de Silva

Given the prevailing shortage of coconuts in the country, the Sri Lanka Desiccated Coconut Millers Association strongly objected to the issuance of licences for new entrants by the Government, insisting that it would drag the existing business towards unprofitability.

“We don’t have sufficient coconuts at present for the existing mills to operate at full capacity, therefore any new factories or mills would only make the situation worse. We strongly object to any new approvals,” Sri Lanka Desiccated Coconut Millers Association President Asitha Gunasekara told the Daily FT.

According to him, the industry is faced with multiple issues such as uncertain weather conditions, increased domestic consumption and coconut trees being felled for real estate. Therefore, he pointed out that if new approvals are given, it would hinder the growth of existing businesses and turn them unprofitable.

Noting that annual national coconut production in Sri Lanka varies between 2,500 and 3,000 million nuts, out of which nearly 70% is used for local consumption and only the balance is available for industries, he insisted it was imperative to have a greater percentage of coconuts available in the industry for export.

“The annual wasted coconut material amounts to about Rs. 29 billion, which is 10 times more valuable in the marketplace. A country such as ours cannot afford such a luxury. We suggest that the Government take corrective action to educate people about coconut consumption in the domestic market. Thereby, each percentage saved from local consumption in the industry can generate tremendous value for exports,” Gunasekara explained.

He suggested that if basic domestic consumer needs could be addressed through new methods, it would open up a number of other coconuts-based industries as well. 

“It will not just open up new production companies but also companies that will make use of the wastage of the coconuts,” he said. 

In addition, he stressed the importance of encouraging the replanting of coconut estates as a solution to aging coconut plantations. He called on the Government to provide necessary assistance for replanting and irrigation technology. 

“There is tremendous demand for organic products the world over and our coconuts are 90% organic. Our coconuts have a distinct taste and we must protect that differentiation factor while generating value-added export products,” he stated.