According to experts, for Vietnam’s coconut industry to sustain long-term growth, multiple bottlenecks across production, processing, and value chain organization must be addressed.

Despite export turnover exceeding USD 1.1 billion annually, Vietnam’s coconut industry has yet to establish a commensurate position in the global market. The country currently accounts for only around 8% of the fresh coconut market share in China—the world’s largest consumer, importing approximately 1.1 million tons in 2025—significantly lower than Indonesia and Thailand.

In addition to limited market share, the value of Vietnamese coconuts remains lower than that of competing countries. Experts identify the primary bottleneck as inconsistent quality, largely due to fragmented production structures and insufficient control over plant varieties.

Dr. Tran Minh Hai, Vice Rector of the School of Public Policy and Rural Development, noted that Vietnam currently has two main coconut categories: oil coconuts and drinking coconuts. However, in many localities, these varieties are intercropped, leading to cross-pollination, reduced genetic purity, and inconsistent fruit quality.

Opportunities for transformation

According to Mr. Nguyen Dinh Tung, Vice Chairman of the Vietnam Fruit and Vegetable Association and CEO of Vina T&T Group, one of the key challenges facing the coconut industry is its small-scale and fragmented production structure.

Most coconut-growing areas are still managed by smallholder farmers, making it difficult to standardize production and ensure stable supply.

“When production remains fragmented, building standardized raw material zones to support large-scale exports becomes challenging. This also complicates procurement, classification, and packaging processes,” Mr. Tung said.

As importing markets increasingly impose stricter requirements on quality standards and traceability, fragmented production may become a significant barrier for export enterprises.

Experts suggest that reorganizing production through cooperative models and strengthening linkages with enterprises involved in procurement and processing will be a critical solution.

Another major challenge is logistics costs. Due to their bulk and space requirements, fresh coconuts incur relatively high transportation costs to distant markets such as the United States and Europe, directly affecting product pricing and competitiveness.

Meanwhile, major coconut-producing countries such as the Philippines, Indonesia, and Thailand have relatively well-developed supply chains and logistics systems, enabling them to reduce costs and enhance export efficiency.

Mr. Tung emphasized that optimizing logistics, along with improving storage and transportation systems, will be essential to enhancing the competitiveness of Vietnamese coconuts in the coming period.

Although Vietnam’s coconut processing industry has made notable progress in recent years, the proportion of deeply processed products remains below its potential.

Currently, a significant share of coconut output is still exported in raw or semi-processed form. Meanwhile, high value-added products such as cosmetics, functional foods, and refined industrial inputs have yet to be fully exploited.

With greater investment in deep processing technologies, the economic value of coconuts could increase multiple times compared to raw exports.

The development of value-added products not only enhances economic returns but also expands export markets and reduces dependence on raw commodity exports.

“Vietnam’s coconut industry stands at a ‘breakthrough’ moment. To realize this, stronger linkages between farmers and enterprises through clean and sustainable value chains are essential,” Mr. Tung stated.

Need for coordinated policies for sustainable development

As international markets increasingly demand higher environmental standards and traceability, Vietnam’s coconut industry is gradually transitioning toward green and sustainable production models.

According to Mr. Cao Ba Dang Khoa, Vice Chairman and Secretary General of the Vietnam Coconut Association, developing internationally standardized raw material zones is an inevitable trend if the industry aims to enhance value and expand export markets.

“Coconut-growing areas need to be reorganized toward concentrated production, applying sustainable farming practices and meeting international standards such as GlobalGAP or Organic,” Mr. Khoa said.

Regarding varieties, instead of traditional propagation methods, certified mother trees with clear genetic origins and regulatory compliance are now required. Technologies such as tissue culture and embryo culture are being applied to develop high-quality planting materials, supporting participation in carbon credit markets.

In production, cultivation and care must be managed through farming logs that meet strict international standards, alongside strengthened pest control and early warning systems.

In processing, enterprises need to invest further in harvesting and deep processing technologies tailored to specific product groups, while also utilizing by-products to develop circular, environmentally friendly products, thereby enhancing value across the entire coconut value chain.

“Many enterprises have invested in technologies to fully utilize coconut by-products—from husks and shells to coconut water—creating a wide range of new products for various industries,” Mr. Khoa noted.

According to the Vietnam Coconut Association, the industry has received increasing attention from government authorities in recent years. Coconut has been identified as a key national crop, with numerous trade promotion programs and international cooperation initiatives implemented to support market expansion.

However, to ensure sustainable development, further improvements in support mechanisms and policies are needed. Local authorities must actively monitor production data by region and strengthen linkages with cooperatives and enterprises to build stable supply chains.

At the provincial level, authorities should continue implementing measures to address saline intrusion, control pests and diseases, and support farmers in adopting advanced technologies.

In addition, organizing forums and workshops to share market information and address business challenges remains necessary.

“To achieve sustainable development, continuous dialogue among government, businesses, and farmers is essential to resolve challenges, promote production linkages, apply technology, develop tourism and logistics, and enhance international trade promotion,” Mr. Khoa emphasized.

The long-term goal of Vietnam’s coconut industry is to establish a sustainable supply chain from farm to processing facilities and end markets. This integrated value chain will not only enhance the value of coconuts but also ensure stable livelihoods for hundreds of thousands of farming households.

With its current development foundation and increasing investment in technology, raw material zones, and deep processing, Vietnam’s coconut industry is expected to continue growing and gradually become a key agricultural export sector.

Source: Bao Nong nghiep va Moi truong