Virgin Coconut Oil or simply known as VCO is edible oil extracted from the meat of matured coconuts. When it was new in the market, many consumers thought that it is a fad – that manufacturers just affixed the word “virgin” to add value to the coconut oil. Little did they know that VCO is called as such because of its purity. No harsh process is involved in extracting the product. There is no involvement of chemicals or heating. Virgin Coconut Oil is simply extracted through mechanical pressing. This process takes much time and effort, thus the product is more expensive than the ordinary coconut oil.
Despite its relatively high price, the Virgin Coconut Oil still has a high demand from the global market. In fact, in 2016, the VCO market is already valued at USD 685M according to the report of Market Research Future. With the growth rate the Virgin Coconut Oil market is having, the VCO market is projected to be valued at USD 4.2B by 2024. So, what are the impetuses of these amazing figures? What drives consumers to choose Virgin Coconut Oil? Let us find out how VCO is performing in the global market and what makes it attractive to global consumers.
GROWTH DRIVERS
Many market observers agree that the main reason that the VCO industry is booming is because of the shift of major population to a healthier lifestyle. The increasing number of different trending diets plus the number of gyms and wellness centers in our neighborhoods are some of the evidence that people are making the lifestyle change. Groceries are also having more choices of organic foods. This is also a sign that the current generation is considered to be health-conscious. Because of this phenomenon, these health-conscious people are more likely to grab Virgin Coconut Oil from the grocery shelves despite its high price.
Some market reports state that more people are leaning towards functional food products. More than being edible, Virgin Coconut Oil is commonly used in cosmetics, medical treatments, and preventive healthcare. This product flexibility plus consumer lifestyle change are the main driving forces of the Virgin Coconut Oil global market.
HEALTH BENEFITS OF VIRGIN COCONUT OIL
VCO is a by-product of the “Miracle Tree” coconut which contains a plethora of health benefits. Therefore, it is expected that VCO has inherited those amazing nutrients. Also, because of the purity of its extraction – not undergoing heat or any chemical treatment – the Virgin Coconut Oil preserves most of the nutrients of its raw material. Here are some of the health benefits VCO can contribute to our body:
- Omega fatty acids
- Vitamins
- Minerals
- Antioxidants
- Saturated fats
- Good cholesterol
Having ample amount of these nutrients in the body can strengthen the immune system which prevents us from catching illnesses. Furthermore, having good amounts of these healthy fats in the body can lessen the risk of our getting heart diseases such as heart attacks and strokes.
These amazing health benefits are also one of the reasons that the Virgin Coconut Oil is attractive to the global market and drives the industry’s revenues.
MARKET SEGMENTATION
These are some of the ways Virgin Coconut Oil is presented in the market:
By Type:
- Organic – This segment has more demand than the inorganic segment because organic foods are known to be healthier.
- Inorganic
By Application:
- Cooking
- Cosmetics
- Healthcare
By Distribution channels:
- Super/Hypermarkets – This distribution channel has major share in the market and is still preferred by most consumers because of the varieties in their inventory, the geographical accessibility, and the customer experience.
- Specialty stores
- Food processing industries
- Non-store based
REGIONAL SEGMENTATION
Here are the three regions in the world that are recorded to have major market shares:
- Asia Pacific – This region dominates the Virgin Coconut Oil market having the largest revenue among the three regions to have major market shares. Primarily because this region has the largest producer and exporter, Indonesia, which has produced 180 Million Tons of product. Meanwhile, the value adding of the 60-70% of the whole VCO market happens in the Philippines.
- North America – This region possesses the next largest revenue in the VCO global market. Market observers say that this is because of the aggressive product developments of the North American manufacturers.
- RoW (Rest of the World)
Virgin Coconut Oil’s amazing feats such as being a functional food product and having many health benefits drive the industry to a very promising direction. It is projected that VCO will have 9.8% CAGR which will yield USD 4.5 Billion of total sales in the span of 8 years (2016-2024). These figures may be stunning on paper, but in reality these amazing numbers are just a reflection of how beneficial the Virgin Coconut Oil industry is to the global economy. As this industry grows, more and more people and families will be benefiting from it. As VCO market booms, more and more people will have more jobs, thus helping families get by in life and even release them from poverty.
See also: Virgin Coconut Oil Against COVID-19