Coconut is a convenient replacement for dairy in baking for many reasons. First, like butter and cream, coconut has a delicious, rich flavor. Second, coconut oil is primarily saturated fat, which makes it solid at room temperature (with a melting point of 76F) and can function like butter or shortening. Coconut oil is also increasingly being recognized as one of the healthiest types of fat (see below).
Baking with Coconut
Heavy cream (aka whipping cream) in many baked goods can be directly substituted with coconut milk, the kind found in cans. Avoid "lite" versions, which are pointless as far as I can tell because some of the fat is removed, which is what contains all the flavor. Be sure to shake the can before opening, as coconut milk usually is separated, unless you know you want just the thick cream on the top.
Coconut oil usually comes in a jar and is solid at room temperature. The easiest way to use it in baking is to place the coconut oil jar in a bowl of hot water, which melts the oil inside, then pour out the melted oil. Clarified butter and ghee, which are nearly all butterfat, can be directly substituted with coconut oil. Normal butter is only about 80% butterfat, as it retains some liquid and milk solids, and in most recipes this should be taken into consideration. To simulate butter in most pastries, I like add 1 part coconut milk to 3 parts coconut oil, and whisk them together with a fork until the oil resolidifies and the mixture resembles whipped butter. This can then be creamed together with sugar or cut into a flour mixture. Coconut oil comes in both scented and unscented varieties. I use the scented version exclusively because I think it imparts rich coconut undertones and makes a better substitute for butter, which has its own flavor. However, if you don't want everything have a coconut taste, try the unscented version.
Shredded coconut is great for adding texture and flavor to baked goods. You can toast shredded coconut to add a caramelized, toasty flavor and a slightly crisper texture. Spread in an even layer on a baking sheet, and bake at 350F for about 5 minutes. Stir with a spatula and return to oven for another couple of minutes. Repeat until evenly golden brown.
If your oven isn't already on, you can also toast coconut flakes in a skillet. Cook over medium heat, stirring or shaking the pan often, until evenly browned. Keep a close watch on the coconut when almost done because it will become overcooked very fast.
There's much that's misunderstood about coconut oil. This is partly because most of the past research on coconut oil was based on hydrogenated coconut oil, which, like any hydrogenated oil, is unhealthy.
Many claim coconut oil to be unhealthy because it is more than 90% saturated fat, more than butter or lard. However, just as it's now common knowledge that not all fats are equally healthy (there are monounsaturated, polyunsaturated, saturated, and then the dreaded hydrogenated oils), not all saturated fats are created equal either. Whereas long chain fatty acids, the main type in animal fat, is difficult for your body to break down and stored as surplus body fat, the saturated fats in coconut oil are medium chain fatty acids (MCFAs), which are supposedly burned by your liver as immediate energy. Proponents of coconut oil say they increase metabolism by taking stress off of the pancreas, helping the body burn energy and overweight people to reduce body fat. They also claim MCFAs are easier to digest, assisting the health of thyroid and enzyme systems, and have antimicrobial properties, which helps to control bacteria, fungi, and parasites that cause indigestion.
There's a widespread belief that coconut oil is bad for the heart because of the saturated fat. However, lauric acid makes up about half the fat in coconut oil, and is said to actually help prevent heart problems such as high cholesterol and blood pressure. It is also the most important essential fatty acid in maintaining the body' immune system. The only other rich dietary source of lauric acid is mother's milk.
As much as I'm tempted to take all these virtues of coconut oil as an excuse to eat unlimited coconut-fattened pastries, like everything else, coconut oil is only healthy in moderation. Because pastries are sweet by definition, they are never going to be truly healthy, but I like to think of coconut oil as a reduced-guilt baking technique.
Mercola, Joseph. "Coconut Oil Benefits: When Fat Is Good For You." The Huffington Post. 14 Feb. 2011. Web.
Patil, Kirin. "Health Benefits of Coconut Oil." Organic Facts. Web
Wilsinson, Fiona. "Health Benefits of Coconut: A Good Diet Aid, Heart Healthy and Helps Fight Cancer." Suite101.com: Online Magazine and Writers' Network. 10 Mar. 2010. Web