The coconut tree, originally from Asia, was brought to Brazil by the Portuguese and since then, it has become a visual identity of the Brazilian coast and a customary ingredient in the country's cuisine. The liquid present inside the fruit, or coconut water, as it is better known, has recently conquered the international markets because, in addition to being delicious, it is also extremely hydrating, low in calories, rich in vitamins and antioxidants and a great natural alternative to isotonics on the market.
Benefits of exporting coconut water
According to data from FAO (United Nations Food and Agriculture Organization), despite Brazil being in fourth place in the cultivation of green coconut, after Brazilian companies that used to work with grated milk or coconut started to market their water too, the country has become the largest producer of coconut water in the world. According to Roberto Lessa, CEO of coconut water manufacturer “Obrigado”, third in the national market, his brand sold more abroad than in Brazil. He estimates that by 2025, close to 75% of Brazilian production will be sold abroad.
Trends in the international market
The UN also points out that Asia, the world's largest producer of the fruit, has recently decreased its production due to the age of its coconut trees. While the apex of the trees' age is between 10 and 30 years, most coconut trees planted in Asian soil are on average 50 years old, so Brazil tends to take more space in this market, as the coconut trees present in the Northeast region they are young.
Brazilian production, of nearly two billion units per year, is mostly concentrated in the Northeast of the country. According to data from Grupo Coco do Vale, there are 57,000 hectares of coconut trees planted in the country, of the dwarf variety, destined for coconut water. Despite this, exports from Brazil are still small, selling on average less than $10 million a year, especially to the United States and Canada.
Market research company “Technavio” expects the coconut water market to expand to over 7 billion dollars in 2021, growing 350% over the past 5 years. Another company with a similar performance, “Arizton Advisory & Intelligence” estimates that in 2023, the market will exceed 8.3 billion dollars.
European demand for healthy food and drinks
European countries that still have a lower consumption compared to South America and Asia, are still extremely interesting markets to export, as there is a demand for healthier foods since sugary drinks have suffered additional taxes in the UK, Norway, Ireland and France. The “sugar tax” will force Brazil to depend on less sugary alternatives to stay strong in the market.
Importance of an international consultancy
In short, coconut water is part of the Brazilian identity and despite its relatively new international interest, there is a growing demand abroad. The coconut water market is a big business, in addition to being profitable, Brazil has abundant resources in terms of quantity and quality of coconut trees to supply this demand. Knowing in detail the market and the consumer you work with, in addition to good strategic planning and decision support, makes the export process superior and intensifies your chances of success in the foreign market.
By Karol Colby on 11/05/2020