Unrefined coconut oil, also labeled virgin or extra virgin coconut oil on the jar, is produced by directly squeezing out the coconut oil from the coconut pulp, without any further processing. When you also see the label "cold-pressed" on a jar of coconut oil, it just means that no heat has been applied during the extraction process.
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The distinguishing characteristic of virgin coconut oil is its rather strong coconut smell and flavor, which is bound to affect food during the cooking process. Unrefined coconut oil also has a relatively low smoke point, which helps you identify what purposes an oil is most suitable for - dipping, flavoring, frying, or baking (for more information, see our article The Best Cooking Oil For Every Task). The smoke point of virgin coconut oil is only 350°F (177°C), compared to 390°F (200°C) for olive oil and vegetable oil, for example.
Refined coconut oil, on the other hand, undergoes additional processing so that it becomes better for cooking, such as neutralizing, degumming, bleaching, and deodorizing. This additional processing ensures the resulting oil is both flavorless and odorless. Refined coconut oil also has a higher smoke point of 450°F (232°C), which means that it's better suited for frying and other kinds of high-temperature cooking.
As we've mentioned above, the higher the smoke point of an oil, the better it is for high-temperature cooking. Therefore, refined coconut oil has a wider range of uses, as it can be utilized for sautéing, braising, and stir-frying. In addition, refined coconut oil is flavorless and odorless, which means that you can use it without being afraid that it will make the food you've prepared taste like coconut.
However, if a coconut flavor and smell is something you seek out, and you're planning on using it in salads and the smoke point isn't an issue, virgin coconut oil may be the better choice. When it comes to baked goods, it's pretty much the same rule as in cooking - if a coconut taste and high smoke point isn't an issue, you can use virgin coconut oil, but overall, refined coconut oil is a more universal choice.
Another popular way to use coconut oil is as a moisturizer and conditioner for skin and hair. For the most part, people recommend using unrefined coconut oil, as it’s more natural and thus may be less irritating for topical applications. However, we'd like to point out that using coconut oil as a moisturizer or face mask may cause skin irritation for some people, so make sure to patch-test near the ear before applying it on the skin.
One last point to consider is your dietary preferences. If you prefer to eat more natural foods and less processed foods, virgin coconut oil may be a better choice because it undergoes less processing. It also needs pointing out that you may want to not consume coconut oil exclusively in cooking because it's high in saturated fats, and it would be better to get less than 7-10% of your daily calories from saturated fats.