RATIONALE
sap every batch. There are two (2) batches in a day.
Coconut sugar (otherwise called coco sugar, coconut
palm sugar or coco sap sugar) is sugar derived from
the sap or toddy, locally known as “tuba”, obtained
from the cut blossom buds of the coconut palm. It has
been utilized as a customary sweetener in the South
and South-East Asian regions. It became popular
worldwide due to its low glycemic index (GI) at 35,
lower than the 54 GI, the level which nutritionists
consider as safe for people who have to watch out for
their glucose level. The GI is an indicator of how fast
carbohydrates convert to glucose in the blood or how
fast carbohydrate turns into sugar.
According to the Philippine Coconut Authority (PCA),
the global market for coco sugar is increasing as the
number of diabetic people worldwide rose from 108
million in 1980 to 422 million in 2014. Philippines
alone contributing two percent (2%) share with 8
million people with diabetes (PCA 2018).
Coco sugar is usually produced by small-scale cottage
industries. The business is simple and does not require
a huge start-up capital given that production does not
require costly machinery. In terms of raw materials,
Region IX, particularly Zamboanga del Norte and
Zamboanga del Sur, have a reported 21.5 million and
11.3 million coconut trees, respectively, which total
account for around 84% of the 39.1 million coconut
trees in the region, ranging from giant to dwarf
varieties (PSA 2019).
OBJECTIVE
The project aims to process coconuts into a high value
added product, coco sugar, to augment the income of
the farmers as well as to contribute to employment
generation in the region.
PROJECT DESCRIPTION This volume of production is around 200 liters of coco
Coco sugar is quietly sweet, very nearly like brown The project requires four (4) workers to operate. The
sugar, yet with a slight taste close to caramel. It is machinery and equipment needed are Crystallization
used for edible purposes essentially as a sweetening Machine, Sieving machine/ Strainer with Magnet,
agent in many traditional food preparations and food Sugar Sachet Filling Machine, Liquid Filling Machine,
products. The table below shows the mineral content Hand Truck Lifter, Strapping Machine and other
of coco sugar. kitchen tools, housed in a plant of around 120 square
meters. Utilities is approximated at 1,500 Cu. m. of
Table 2. Mineral Content in Cocosugar water, 2,500 kilowatts of power and one (1) tank of
MACRONUTRIENT mg/L (ppm) in dry Amount LPG per month.
matter Content
Nitrogen (N) 2,020.00 The project requires a total investment cost of
Phosphorus (P) 790.00 P2,444,900.00 comprising of P2,251,600.00 fixed
Potassium (K) 10,300.00
assets and P193,300.00 working capital for one (1)
Calcium (Ca) 60.00
Magnessium (Mg) 290.00
month. Average annual net income before taxes is
Sodium (Na) 450.00 computed at P680,100.00 with a return on investment
Chlorine (Cl) 4,700.00 at 28%. The gross and net profit ratios are 30% and
Sulfur (S) 260.00 24% respectively. The investment cost will be
Boron (B) 6.30 recovered in approximately 2 years and 4 months of
Zinc (Zn) 21.20 continuous operation. Considering these figures, the
Manganese (Mn) 1.30
project is deemed financially viable.
Copper (Cu) 0.60
Iron (Fe) 1.20
Source: PCA - Plant Tissue Analysis Laboratory MARKET TRENDS AND OPPORTUNITIES
Global market size of the coco sweetener industry is
Coco sugar is essentially a two-stage process:
around US$1.2 Billion to US$1.7 Billion as of 2018,
collection of coco sap, and processing. Sap collection
projected to grow at a compounded annual growth rate
will be done two times in a day. Upon collection, the
of 5% to 6% during the forecast period of 2019-2025.
sap is strained to clean it of foreign particles. Strained
(IndustryARC). Asia Pacific countries including the
sap is placed in an appropriate wok, then cooked under
Philippines, Indonesia, Thailand and India collectively
high temperature for about 1.5 hours. Cooked sap will
share around 85% to 90% of the global coconut sugar
be pulverized and sieved to come up with the
market. According to PCA’s Research and
granulated form. Powdered coco sugar will be dried
Development Division, the Philippines produces about
through the oven dryer for about 30 minutes. After
4,000 metric tons of coco sweetener annually, lesser
drying, sugar is cooled, packed, sealed and labeled in
than Indonesia that has been growing the dwarf
1 kilogram plastic bags. The product is locally priced
varieties that produces more sap and are easier to tap.
at P200.00 per kilogram based on prevailing market
Current markets for coco sweetener include the United
price.
States, North and Latin America, European Union
(Germany, Netherlands, United Kingdom, France,
Norway), Canada, South Africa, Australia, New
Zealand, Japan, South Korea, and the Middle East.
ASSUMPTIONS:
FINANCIAL REQUIREMENT

Table 3. Total Project Cost

 The plant capacity is pegged at 115,200 liters of PROJECT BRIEF
coco sap at a cost at P10.00 per liter.
 There are two batches of operation in a day, ON COCONUT PROCESSING
Coconut Processing (Coco Sugar Production)
Current Assets Amount morning and afternoon. (Coco Sugar Production)
Producti on Bui l di ng 300,000.00  Recovery rate upon processing is 12.5%,
Offi ce Bui l di ng & Fa ci l i ti e s 101,000.00
equivalent to the monthly production volume of
Production Facilities & Equipment:
Crystallization Machine 330,000.00 1,200 kilograms of coco sugar.
Sieving machine/ Strainer with Magnet 250,000.00  The straight - line method is used in depreciating
Sugar Sachet Filling Machine 270,000.00 fixed assets.
Liquid Filling Machine 300,000.00
Hand Truck Lifter 500,000.00
 The life of the investment is based on the
Strapping Machine 70,000.00 estimated useful life of the production building
Ki tchen Tool s 130,600.00 which is 25 years.
Subtotal 2,251,600.00
 Coco sugar is priced at P200 per kilogram.
Working Capital (1 month)
Di rect l abor 37,100.00
Di rect ma teria l s 96,000.00 Table 1. Projected Income Statement
Prod'n Overhead 35,200.00
Sel . & Admin. Expens es 15,000.00 Coconut Processing (Coco Sugar Production)
Pre-opera ti ng expens es 10,000.00 Particulars Year 1
Subtotal 193,300.00 Sales 2,880,000.00
TOTAL PROJECT COST 2,444,900.00 Less: Cost of Sales
Raw Materials 1,152,000.00
References: Labor 445,700.00
Production Overhead 422,100.00
Philippine Coconut Authority (PCA) Total Cost of Sales 2,019,800.00
PCA Research Center Gross Income 860,200.00
Industry Analytic Research Consulting (IndustryARC) Less: Selling & Admin. Expenses (Note 2) 180,100.00
Mr. Francisco Aseniero - Aseniero Food Products Net Income before Tax 680,100.00
Return on Investment (Ave. Net Income/ TPC) 28%
Gross Profit Ratio (Gross Profit/Sales) 30%
Net Profit Rate (Net Income before Tax/Sales) 24%
Payback Period (Ave. Net Income + Depreciation/TPC) 2 years and 4 months

For Inquiries, please contact:

Department of Trade and Industry – Regional Office No.
IX
4th floor VHW Bldg., Veterans Avenue, 7000 Zamboanga City
Tel. No. 991-3238
Email Address: R09@dti.gov.ph
Prepared by:
MASICAP MSME Development Foundation, Inc.
October 2014 ©