India's oilseeds sector, which includes its coconut economy, experienced drastic changes in the wake of agricultural liberalization in the mid-1990s. A persistent coconut crisis 'narrative' emerged after sharp price declines between 2000 and 2002 in which small farmers in the state of Kerala, India's main coconut producer, were identified as victims of the liberalized importation of cheap palm oil. This article describes this crisis narrative based on a literature review of academic and official reports, and challenges its problem analysis by juxtaposing it with information from ethnographic research with local farmers and traders. The research indicates that local labour shortages and increased regional competition also had a strong impact on Kerala's coconut market, production and processing, which varied from region to region. Furthermore, small farmers, with their diversified livelihoods, did not recognize a 'crisis' as such. Drawing upon the 'advocacy coalition framework', the article also indicates reasons for the emergence and persistence of the coconut crisis narrative and points to complex processes of restructuring social space in the age of globalization.