Mānuka honey glut over, but trade wars could be sour for beekeepers
Aotearoa beekeepers are hoping a global mānuka honey glut is finally over, even as international markets become more volatile.
Weak honey prices and oversupply of the premium product led to high-profile business closures around the country in the last few years, including the recent collapse of Manuka Bioscience backed by richlister Wayne Wright.
But tides could be turning. This month, Taranaki honey producer and exporter Egmont Honey was acquired by Chinese investment company Huatai Securities. Owner James Annabell said the sale showed global confidence in the the mānuka honey market.
“There are green shoots [reinforced by] the fact a large private equity out of China is excited about our industry and our potential.”
Hong Kong-based Huatai PE NutriFoods now owns 90.4% of Egmont Honey, bought from Swiss-owned Nestle, which owned 75% previously. Annabell says his shareholding dropped from 25% to 10%.
The US market was already major for Egmont Honey with products featured at the likes of Costco and Walmart, but Annabell felt “positive” because of better demand out of Europe, the UK and the UAE.
The product was on shelves at Life Pharmacy in the UAE, health store Holland and Barrett in the Netherlands, and Aldi supermarkets in Germany - and that could shield the company from trade disruption from the US, he said.
While beekeeper numbers were thinning, Annabell said that was helping New Zealand’s apiary industry remain sustainable.
“There were a lot of beekeepers in the last few years - that was not good for our industry. You had people boundary stacking, you had people stealing hives. Those days are behind us and as demand continues to increase, we can keep up our supply.”
At the top of the South Island, Moutere Beekeeping owner Hector Urquhart says beekeeper numbers have dropped dramatically, portending more businesses folding.
“Over the last five years, a lot of businesses focused on mānuka haven't been able to sell their honey. They have either offloaded it at very low prices or subsequently gone out of business.”
According to Apiculture NZ’s March honey market update, an oversupply of mānuka honey in 2020 led to “deadened” export prices in the years afterwards. Last year, 21% of all honey exports were ‘bulk’ sold, meaning at lower prices, up from 15% in 2023.
Prices slid to about $28/kg last year from $44/kg in 2019, the report says. The mānuka honey glut put pressure on beekeepers, who were competing with discounted products from struggling, or insolvent, companies.
Devalued products
Last year, Moutere Beekeeping had its biggest honey harvest in its 22-year history, at 85 tonnes. That was quite the turnaround from its lowest-ever crop in 2023, which yielded 25 tonnes.
This year’s harvest wrapped up last month and was slightly above average at 75 tonnes.
But Urquhart says the harvest is ultimately devalued, with honey prices yet to bottom out and demand for higher-priced mānuka still subdued.
The business diversified into multifloral mānuka, beeswax and flower pollination agreements with other farmers to supplement lost income, which meant relying on those lower-value products compared with mānuka.
Urquhart says margins are tight with honey prices at $8.50 to $9/kg. Meanwhile, breaking even costs $8.50/kg for pollinated honey and about $10/kg for honey without pollination.
The business’ labour costs rose 7% in the last two years, with fuel and sugar costs up about 50%. As well as managing the business, Urquhart is keeping a significant number of bees himself to keep production going.
Glut tide turning
The drop in hive and business numbers around the country could mean supply is finally matching demand.
“In New Zealand, we've probably got the balance right… We've got the right number of hives and if that drops, it probably equals the demand for our honey,” Urquhart says.
“My feeling is that things will start improving from 2026… Prices for beekeepers definitely have to come up, otherwise it's not sustainable.”
Liam Gavin runs Gavins Apiaries in Titoki, Northland, with his whānau, and says even the 113-year mānuka manufacturer hasn’t been without its challenges.
“Our family business has been going for a long time, so we’ve been able to manage difficulties in the last few years.
“I’m starting to see a positive shift in the industry,” he says, noting sales inquiries from around the world are stronger compared with the last two years, particularly in Europe and the UK.
“The sales inquiry I'm getting tells me there's not as much of that oversupplied product available any more.”
Despite falling demand and pricing for mānuka honey, Gavins Apiaries stayed focused on mānuka production: “We’re waiting for the price to turn.”
US export market ‘potentially destabilising’
But beekeeper positivity has been muddied by mounting trade tension, especially with the honey market’s exposure to international volatility.
Apiculture NZ’s March update states: “The US increased its dominant position as the leading destination for New Zealand honey in 2024.”
Almost 25% of total honey export revenue was generated from the US last year, earning $99.5 million in revenue, up from $77.1m in 2023.
“The increasing reliance on the US makes the projected introduction of tariffs on all agricultural products entering the US a potentially destabilising influence on New Zealand mānuka honey exporters’ marketing focus,” the report says.
It is unclear as we go to press exactly what tariffs will remain on local goods, with US President Donald Trump pausing tariff increases on most countries, although most will still have a 10% increase, including New Zealand.
“Our industry is very dependent on what the overseas markets are doing. New Zealand's economy doesn’t affect our industry as much,” Gavin says, though being the main global producer of mānuka honey gave Aotearoa producers an edge over international competition.
Urquhart says Kiwi honey exporters may have to increase market share in countries like China, where honey export revenue dropped to $55m last year from $65m in 2023.
“Beekeepers can't absorb that cost because we're running so lean. If we have to cut another 10% of our beekeeping practices, we'll all be out of business,” Urquhart says. “We're hoping it won't affect us too much.”
Apiculture NZ chief executive Karin Kos says it’s still too soon to know if the industry impacts will differ from other New Zealand food and agricultural exports into the US. Based on export revenue in 2024, a 10% tariff on Aotearoa honey will add $9.9m to US export costs.
“We do know that prices for all imported food products to the US will increase as a result of the tariffs,” she says.
That means US consumer demand and impact export prices are likely to drop. On top of that, high prices on imported goods for Chinese consumers could lead to damp demand and pricing.
But Kos says current market shifts are adjusting to meet global levels of honey demand. That creates an opportunity for local businesses to tap into new markets like India where free trade negotiations started early this year.
“We anticipate that if New Zealand honey producers and exporters had free trade access to India’s consumers, there would be a strong prospect of much needed export revenue growth.”
댓글
댓글 쓰기