The United Coconut Association of the Philippines (UCAP) is in support of the proposed increase in biodiesel blend next year, fueled by confidence that coconut production will recover from weather-inflicted setbacks.

UCAP Vice Chairman Dean Lao Jr. said the industry group is open to lifting the suspension of the hike in the three-percent to four percent biodiesel blend, or B3 to B4, once domestic coconut supply “normalizes.”

“We expect that to happen next year because of our beneficial rates this year, and that the trees have rested this year. They should come back with higher productivity next year,” said Lao in a press conference.

Philippine Coconut Authority (PCA) Administrator and Chief Executive Officer (CEO) Dexter Buted disclosed last month that the government is evaluating the market situation to determine when the suspension of the increase will be lifted.

Buted, a member of the National Biofuel Board (NBB), said the body is keen on initiating the increase to B4 within the first quarter of 2026.

Buted said that this would be driven by an increase in production, aided by the PCA’s fertilization program, which can reach about 45 million trees, yielding at least 11 nuts per tree annually.

PCA estimates that output will reach up to 19 billion nuts this year.

In May, the NBB proposed a pause on the increase from B3 to B4, which was initially scheduled on Oct. 1.

The NBB, an interagency recommendatory body, cited the surge in feedstock prices—particularly coconut oil—as the reason for the move, stressing the need to avert potential market shocks.

During the time of its recommendation, coconut oil prices rose to over $3,000 per metric ton (MT) due to limited supply in the world market. As of August, average prices fell to $2,845 per MT, based on World Bank data.

As the main feedstock, high prices lead to spike in coconut methyl ester (CME), which is the raw material blended with diesel to make biofuel.

The Department of Energy (DOE) officially postponed the planned biodiesel blend hike in July.

Lao, also the president and CEO of biodiesel producer Chemrez Technologies Inc., said the temporary suspension was a “very sensible move.”

“If we did proceed with the B4, we don't know how the supply chain would react. But I think maintaining it at this level gives us some time to prepare,” he said.

With the expected recovery in production from the impact of drought in the previous two years, Lao hopes that the NBB will opt to implement the biodiesel blend increase next year.

“We hope that DOE can also see similar recoveries in supply and price correction,” said Lao, citing the DOE’s role as head of the NBB.

He noted that the increase to B4 would further boost demand for coconut oil, estimated at around 90,000 MT per year. Under the current B3 mandate, he said approximately 270,000 MT of coconut oil is already being utilized annually.

The DOE most recently updated the biodiesel blend to B3 last year. The government first implemented B1 in 2007, and later to B2 in 2011.

Embodied under Republic Act (RA) No. 9367, the Biofuels Act mandates that all liquid fuels for motors and engines contain locally sourced biofuels.

The requirement aims to cut down the country’s dependence on imported fuels, decrease greenhouse gas emissions, and boost the biodiesel and bioethanol sectors.