Dear valued readers,
It is pleasant being in the position to share some encouraging news from our recent market analysis. Despite the relatively low reported transaction volume in Week 19, it at least reflects positive movement in the market.
Looking ahead, there’s growing speculation that prices could see further improvement as South Africa and Australia approach mid-harvest. This presents an opportune moment to re-align strategy by analyzing trends and using current information to be proactive in our decision-making to capitalize on movements.
You are most welcome to delve deeper into these insights shared in our latest newsletter. Feel free to share it with your industry peers to foster collaboration and growth that will be to the benefit of the greater good of our trading community.
Latest macadamia transactions: 6-10 May 2024
Although few transactions were reported in the previous week (Week 19), suppliers will be encouraged in how they compare with average prices since the beginning of March. In line with market expectations, kernel prices continue to move upwards. NIS prices for larger styles retained their levels this week. There is speculation that prices could improve now that South Africa and Australia approach mid-harvest.
Market sentiment
Expectations of improved kernel prices this year continue to rise. There is relatively limited kernel stock available despite an increase in production in most grower countries into 2024 as much of production is committed as NIS supply to China. This is not surprising given last year’s kernel prices and China’s late buying run that cleared out 2023’s NIS inventories. Now, however, handlers are reporting increased interest in kernel macadamias. In addition to reports of a firm recovery in European demand for kernel products, handlers are reporting of increased enquiries from the US, the Middle East as well as the Far East. In the face of this growing demand, processing capacity limitations and improved NIS prices accepted by China could keep kernel stock restricted into the year and underpin price improvements for handlers and producers.
South Korea is among those showing increased demand for kernel products. Imports have been steadily growing since 2015, reaching 1,462mt in 2023. Supplied almost exclusively by Australia until now, South Korea started receiving significant volumes of kernel macadamias from South Africa since the beginning of this year. The Korea Customs and Trade Development Institute reported the country imported 185.4mt in shelled macadamias from South Africa during Q1 2024 (representing 32.3% of South Korea’s first quarter shelled macadamia imports). Malawi also exported kernels to South Korea for the first time (8mt in Q1 2024). Australia, South Africa, Malawi, and Kenya have also increased kernel exports to Japan in Q1 2024 against Q4 2023. There are also reports from handlers of increased kernel interest from India and Lithuania.
Trade trends
Macadamia cultivation in Malawi, Zambia, Zimbabwe, and Mozambique has been growing with orchards coming to full fruit in recent years. Malawi has processing capacity, supplying international markets for both kernel and NIS products. The other three countries mostly supply NIS to South Africa. When combining NIS imports to South Africa from these four countries for 2023, it is evident that most came from Mozambique (42.3%) and Malawi (29.7%); Zambia accounted for 14.5% in 2023 and Zimbabwe 13.5%. Since 2018, Tanzania and Eswatini have also been exporting NIS macadamias to South Africa, although the amounts are small.
Mozambique exported 3,316mt of NIS macadamias to South Africa in 2022 according to the SA Revenue Service. The country also exports to Vietnam, Hong Kong, and China. In addition to exporting to South Africa, Zambia also exports a limited amount to Malawi while Zimbabwe also exports to Mozambique (2022: 2,810mt) from which product is shipped through Beira. The US, Netherlands, Germany, and Vietnam are all important kernel markets for Malawi.
In The News…
9 May 2024: Macadamia industry struggles with genetic advancements
8 May 2024: Sector should brace itself for tumultuous times
7 May 2024: RSG interview with Barend van der Schyff of Valley Macadamias [Afrikaans]
6 May 2024: Vietnam Business News
6 May 2024: China’s strong demand clears South Africa’s inventory, macadamia prices may increase by 10-30%
4 May 2024: Macadamia exports in 106pc upswing… harvesting reaches home stretch
3 May 2024: Macadamia market report: price trends and regional developments
2 May 2024: Hawaii’s ‘famous macadamia nuts’ threatened by cheaper, undisclosed Australian imports