This sugar is derived from the sap of coconut palm tree. The sap circulates like fluid within the tree and coconut sugar is essentially a dehydrated form of the sap. The sap is derived by cutting into the flower buds of the coconut palm tree. The extracted sap is then boiled with water and the final product ends up as coconut sugar. It looks like raw and unprocessed white sugar, with a tinge of brown in the granules.