Foreword
Dear readers,
The international macadamia market is in a phase of recovery. The increase in supply this year is being accompanied by an increase in demand and prices. Within this period there are new and sometimes unexpected developments that affect one’s understanding of the market. For example, Kenya’s temporary removal of the prohibition on unprocessed exports, or China’s increased local processing capacity which is developing to meet changing domestic consumer preferences for value-added products. We’ve also seen geo-politics affect Guatemala’s macadamia trade, and weather patterns affect the timing and quantum of supply.
How does a supplier or a buyer take advantage of demand recovery and price shifts in volatile global markets? What are the offers? Where is the value? What is the nature of enquiries and bids? What underlying trends are driving category price movements? The answers to such questions can cause suppliers and buyers to recalculate their positions and reconsider forward contract plans. A trading platform brings transparency to the industry, enabling more players to make intelligent and well-timed market decisions. With increased information flow back up the value chain to growers, farmers can better understand what influences farm-gate prices and adjust their production or farm-level marketing accordingly.
A platform brings both buyers and sellers into an understanding of the marketplace; brings them closer to the market and reduces their risk of missing the market.
We’ve reached the end of the second quarter of 2024, a key moment in the annual macadamia marketing calendar. It’s been a dynamic year in the market, and reinforced the need for the industry to be well positioned to make informed, agile decisions. MSM is an intervention aimed to support the industry in this goal.
We trust you enjoy this week’s market review, and its insights into macadamia marketing.
Latest macadamia transactions
The two graphs below compare the most recent five-week period (Weeks 22-26) with the five-week period that preceded it (Weeks 17-21). A recent sharp jump in average Style 1S prices in reported trades is evident in the comparison graphs below, although it is based off relatively few transactions. Market volume appears concentrated in Style 1 and Style 4L transactions, which continue to show average price increases.
Average NIS 20-22 prices continued their recovery over the previous five-week period. Average price declines observed in reported trades during May and part of June now appear to be arrested as market dynamics develop into the year.
Market sentiment
Traders report that demand for NIS remains strong even at the end of June. However, despite supply rising with South Africa and Australia’s harvests nearing completion, most stock coming in now is already committed while new demand sustains. According to a European buyer, this is keeping NIS prices at favourable levels for both buyers and suppliers.
Although average kernel prices have recovered well against 2023 prices as suppliers have focused on NIS supply, they are still well below wholesale prices from earlier years. The low prices and accompanying retailer promotions have stimulated demand in Europe into 2024.
This year’s price increases that have followed haven’t dampened enquiries for various snacking styles even to the present time. Apparent growth in macadamia value-added products in key markets suggest production innovation is accelerating at current wholesale prices. Average kernel price increases have tapered off during the month of June perhaps as NIS commitments have been fulfilled and suppliers respond to kernel enquiries. The increased cracking of smaller nuts has seemingly been behind the price rise of NIS 20-22 macadamias during June; a switch in focus intended to meet the strong demand in both snacking and ingredient styles.
Trade trends
The import of prepared or preserved macadamias to the United States, both inshell and kernel products, has increased in volume this year. The volume of trade in the first four months of 2024 also compares favourably to the first four months of 2023 and also that of 2022. US imports of macadamia products in general dropped off sharply in 2022. While fresh or fried macadamia import volumes (both inshell and kernel) have not recovered, there is renewed growth in the import of prepared or preserved macadamias. However, at this stage the volumes traded are still very small, compared to dried or fresh macadamia trade.
Australia is the leading supplier of preserved macadamias to the US, accounting around 65% of imports. In January 2023, after advocacy from the Australian macadamia industry, the US Animal & Plant Health Inspection Service updated regulations recognised that roasting macadamias, whether as kernel or inshell, reduces phytosanitary risks. This has paved the way for increased supply of prepared or preserved macadamias to the US.
In The News…
1 July 2024: Sunco & Frenchie LLC. recalls Terrafina brand “Macadamia in the Raw”.
28 June 2024: Kenya targets more exports, jobs with major EPZ investments.
28 June 2024: Macadamia farmers face market squeeze after pandemic drop.
26 June 2024: Farmer preference for macadamia varieties and constraints to production in Malawi.
24 June 2024: Macadamia nuts recalled over listeria contamination.
20 June 2024: Trade agreement helps Marquis Macadamias crack the Indian market.
19 June 2024: Real-time e-commerce platform could revolutionise mac trade.
19 June 2024: Macadamias: The situation is improving.