Coconut production plays an important role in the national economy of the Philippines. According to figures published in December 2009 by the Food and Agriculture Organization of the United Nations, it is the world's largest producer of coconuts, producing 19,500,000 tonnes in 2009.
There are 3.6 million hectares dedicated to coconut production in the Philippines, which accounts for 25 per cent of total agricultural land in the country. Land devoted to cultivation of coconuts increased by about 6 percent per year during the 1960s and 1970s, a response to devaluations of the Philippine peso (PHP) in 1962 and 1970 and increasing world demand. Responding to the world market, the Philippine government encouraged processing of copra domestically and provided investment incentives to increase the construction of coconut oil mills. The number of mills rose from 28 in 1968 to 62 in 1979, creating substantial excess capacity.
This industry also contributes an annual average of 5.97% to the country’s gross value added (GVA) and 1.14% to gross domestic product (GDP), PCA statistics showed.
Considering the importance of the coconut industry in nation building being one of the principal industries and one of the largest income earners of the country, it becomes mandatory for the Government to step-in and regulate the unabated and indiscriminate cutting of the coconut trees.For reasons of national interest, it is hereby declared the policy of the State to provide for the growth of the industry by embarking on a sustainable and efficient replanting program. In lieu of this, the Coconut Preservation Act was made.