Coconut palm sugar is produced from the nectar of coconut flower buds. The buds are cut open and the sap is captured, and then boiled down. The result is a caramel-colored sugar that has similarities to brown sugar.If you are looking for a natural, plant-based sweetener to keep your blood glucose and energy levels up, coconut sugar is the ideal choice. Lower chances of a blood sugar spike. Per serving, coconut sugar contains a small amount of inulin, a type of soluble fiber that can make post-meal blood sugar spikes less likely.