SAN PASCUAL, Batangas—Agriculture Secretary Francisco P. Tiu Laurel Jr. on Monday led an ocular inspection of the facilities of United Coconut Chemicals Inc., as the government reassesses whether to proceed with the long-planned sale of the once-dominant coconut chemicals producer amid renewed global demand for coconut-based products.
“We want to see for ourselves whether it still makes sense for the government to continue operating this chemicals and oleo fats factory given the rising demand for coconut products, particularly in Europe,” said Tiu Laurel, framing the visit as a fact-finding exercise ahead of a policy decision.
The government, through the Land Bank of the Philippines, is offering about 682 million common shares of the company—now widely known as Cocochem—aiming to raise at least P2.82 billion. Proceeds are intended to support coconut farmers, while the sale could open the door for private investors to revive or repurpose the asset in line with shifting market conditions.
Established in 1981 by then President Ferdinand E. Marcos Sr. and Ambassador Eduardo M. Cojuangco Jr., Cocochem was once the largest coconut chemicals and oleo fats factory in Southeast Asia. It was the first in the region to produce fatty alcohols via the fatty acid route using German-designed Lurgi technology.
The complex also features a private jetty capable of handling 35,000-deadweight-ton vessels, a logistical advantage that supported its export-driven growth. By January 1986, Cocochem was shipping products to the United States, Europe, Japan, Korea, China, ASEAN countries, India, Australia, New Zealand, South Africa, and the Middle East.
However, a series of setbacks followed. In 2001, the non-implementation of Executive Order 259—which mandated the use of fatty alcohol in local detergent products—curtailed domestic demand. A decade later, record-high coconut oil prices, trading at a significant premium over palm kernel oil, undermined competitiveness against ASEAN rivals.
Plant operations were shut down in 2012. The company subsequently shifted gears. In 2014, Cocochem transitioned from manufacturing to a facilities-based enterprise.
Today, it generates income primarily from land leases, storage tank and warehouse rentals, power distribution, wastewater treatment, pier and weighbridge operations, dockage fees, water supply, and housing rentals.
Operating across 39 hectares, Cocochem’s revenue mix reflects this pivot: Cocochem Agro-Industrial Park Inc. contributes 53 percent of annual income, Cocochem itself 44 percent, and residential operations the remaining 3 percent.
With European demand for coconut derivatives gaining traction once more, the government’s review raises the question on whether coconut farmers interest would be better served if the state hold on to a strategically located asset.
