The Vanuatu government says its promotion of the local use of coconut fuel is groundwork for what it hopes will become a major international export product.
Trade Minister James Bule, who is encouraging farmers to replant their ageing plantations, is confident they can sell all the copra being produced in the country and maintain a stable price.
This follows a government announcement that it will run all its vehicles on one hundred percent coconut fuel from next month.
Mr Bule says the best way to secure the increase in the price of copra which farmers are demanding is to add value to the product.
He says they are already selling oil to the French-owned local electricity provider UNELCO.
"We are still in the early stage and we are testing it in the local markets... like in the Electricity supply of UNELCO. At this point in time, we are supplying 16-thousand litres a month. Progressively we are gonig to increase and over five years we will reach the target of supplying one hundred percent biofuel to UNELCO."