The Department of Agriculture (DA) is calling for urgent amendments to the Coconut Farmers and Industry Trust Fund Act as it seeks to overhaul one of the Philippines’ most critical yet underperforming export sectors.

Agriculture Secretary Francisco Tiu Laurel Jr. said the reform is essential to revitalizing the coconut industry, which remains the country’s top agricultural export earner but continues to face dwindling productivity and aging tree populations.

“We must revise the law to focus the trust fund’s resources on the most critical needs – particularly replanting,” Tiu Laurel said.

Under the DA’s proposed strategy, the Coconut Trust Fund – currently at P80 billion – would be redirected to address the most urgent threats to the sector’s viability. Chief among these is the widespread aging of coconut trees. Over half a century old, many trees now yield fewer than 50 nuts a year – far below the 80 to 100 nuts produced by younger trees.

While the Philippine Coconut Authority (PCA), an attached agency of the DA, has ramped up seedling distribution, the department said that long-term sustainability requires a broader policy shift. In 2024, the PCA planted 8.6 million coconut seedlings, exceeding its 8.5 million target, but the pace still falls short of President Marcos’s ambitious goal of 100 million trees planted by 2028.

The DA is backing a proposal to amend Republic Act 11524 to allow greater flexibility in the deployment of trust fund resources. This would enable the PCA to prioritize high-impact interventions such as replanting, fertilization, and climate-adaptive farming infrastructure.

Aside from planting, the DA plans to fund drip irrigation systems, water impounding facilities, and farmer welfare programs.

“These reforms are about more than productivity – they’re about securing the livelihoods of millions of Filipino coconut farmers,” Tiu Laurel emphaiszed.

Despite being the world’s second-largest coconut producer after Indonesia, the Philippines continues to lag in farm productivity. Only 134 coconut processing plants are operational nationwide – many running at just 50 percent capacity – while 60 oil mills operate below their combined 3.7 million metric ton capacity.

Still, the DA sees strong potential for growth. The industry earns around $2 billion annually from coconut exports, ranging from crude oil and desiccated coconut to copra meal and coconut water. Demand for coconut oil continues to rise, especially in Europe, offering new opportunities for higher income generation if raw nut output can be increased.

“We’ve consulted with agencies, farmer groups, and stakeholders to ensure the amendments to the Coconut Farmers and Industry Trust Fund Act reflect the sector’s growing needs,” PCA Administrator Dexter Buted said.