Global macadamia market shows a steady upward trend
The global macadamia market has continued to show a steady upward trend and it’s expected to be a billion-dollar industry by 2024. The demand for macadamia nuts has been rising globally, although the supply is still low in the international market. This has resulted in variations in the demand and supply of nuts. To speed up the development of the macadamia market, there is a need for investments in the industry including contributions from the government and NGOs.
Factors that result in the high demand for macadamia nuts
Various factors have fueled the demand for nuts which include:
- The nutritional value and health benefits of macadamia nuts especially their high content of minerals and vitamins.
- The growing use of macadamia in cosmetics and personal care products such as shampoos.
- The growing use of macadamia nuts to add value to confectionery products and beverages.
- The increasing awareness among consumers about natural cosmetic ingredients.
Due to their high demand, the prices of macadamia have been relatively high in the international market and the majority of nut farmers have smiled at the bank. In the macadamia value chain, about 30 percent buy macadamia seedlings from companies. However, only a small percentage sells their nuts to companies directly demonstrating a weak relationship between macadamia companies and the farmers. The relationship is quite strong between brokers and farmers. However, some companies buy nuts directly from farmers.
Importance of selling directly to companies
Selling to companies is important since farmers get basic training on macadamia farming.
Farmers can enjoy relative price stability and organic certification.
They also learn about product innovation, international collaboration, and gain technological know-how.
Market analysis of macadamia nuts
The market for Kenyan nuts is quite broad, spanning from local to international. The diversified use of macadamia nuts facilitates a wide range of market opportunities. Kenya has managed to tap the Chinese market where the demand for macadamia has been increasing. The demand has also been increasing in Europe, Asian countries and America. Recently, the high demand has even made the prices of macadamia nuts to rise to KES 180 per kilo.
In Europe and Asia, the processing of macadamia nuts has been increasing rapidly. Raw macadamia cannot be produced in Europe and most parts of Asia due to the climatic conditions and hence the nuts have to be imported. Europe and Asia offer the largest market for macadamia. In Europe, macadamia are mainly processed by blanching, roasting, salting, and spicing. Luxembourg is one of the top nut processing countries in Europe. Market opportunities can be found in the growing markets of Eastern and Central Europe. Currently, Germany, the United Kingdom, and the Netherlands are the largest import markets for Kenyan macadamia offering good opportunities for exporters in Kenya. In Asia, China offers the best market for Kenyan nuts.
Due to the high consumption of macadamia products, steady growth is expected. Since 2015, macadamia imports have increased in Europe at a rate of 10% in volume and 19% in value which shows that import prices have increased. Heavy investment in macadamia farming in Kenya can help farmers to gain a higher market share for their nuts in the European market over leading suppliers from the USA, Australia and other parts of the world. In Kenya, macadamia farming has no restrictions and regulations in the international market and therefore the prices are determined by the demand and supply of nuts in the market. Farmers should hence consider venturing into the lucrative business.