Soak the shredded coconut in the water for 1-2 hours. I let it soak in my blender jar because I'll be using it in the next step anyway.
Blend the coconut and water mixture in a blender for a minute or two.
Meanwhile, prepare a cheesecloth or white cotton towel and a bowl.
Pour the mixture into the cloth, and strain.
The liquid that you squeeze out of the cloth is your coconut milk. You can use it right away, store it in the fridge for a couple of days, or freeze it in ice cube trays (I use and love these) for easy future dispensing.
Don't throw away the coconut fiber in the cloth. It will soon become your coconut flour!
For the Coconut Flour
Take the pulp that is left over after straining your coconut milk, and spread it out in a thin layer on a baking sheet. I lined the sheet with some parchment paper first.
Bake on low heat until it feels completely dry. You are almost done!…
Grind in a coffee grinder or a food processor until you get as fine of a powder as you can with your particular machine. Even if it doesn't get completely powdery or flour-like, it should still work quite well in recipes that use coconut flour.
Nutritional information assumes approximates one 1/2 cup serving of coconut milk plus 1/4 cup of the resultant coconut flour.