Pictured Above: Discussing markets at the recent SAMAC industry day are, from left, Shane Hartman, CEO of Global Macadamias; Mike Benjamin, CEO of Golden Macadamias; PJ Venter, Director of Mayo Macs; Jillian Laing, CEO of the World Macadamia Organisation; Alex Whyte, Director of Green Farms Nut Company; Zac Bard, President of the World Avocado Organisation and Myles Osborne, SAMAC Vice Chairman.
“Don’t find customers for your product, find product for your customers.” Seth W. Godin
Industry experts at this year’s South African macadamia industry (SAMAC) day urged the more than 550 farmers and processors who attended to focus on marketing decisions geared for long-term prosperity rather than short-term gains.
The event was hosted at the Whispering Thorns Guest Farm in the north-eastern region of Mpumalanga.
Headline speaker Professor Ferdi Meyer – who is the director of South Africa’s Bureau for Food and Agricultural Policy – said indicators over time had shown how economies in developed countries were stagnating compared with the growing popularity of the value-for-money products originating in developing nations.
“Emerging markets are still the big movers and shakers. But growth in China is slowing down, with most projections showing that India will overtake them as the biggest economy in the world,” he said.
While potential market growth was good news, Jillian Laing, CEO of the World Macadamia Organisation (WMO), cautioned the domestic sector to drive appropriate growth. “As macadamia prices start to increase again, it is important to pursue markets where consumers can afford the higher prices,” she said.
Director of Mayo Macs PJ Venter said demand from China was increasing for both kernel and inshell. “This means higher quality nuts are needed and they (younger consumers) are becoming far more discerning. It’s not the anything-goes-market it used to be a decade ago.”
Although demand for kernel was picking up in China, Venter said the Chinese were buying inshell and cracking it themselves, rather than sourcing kernel. “Higher demand is good news but beware – once the Chinese have secured sufficient supply, they will start competing with us in the kernel markets and pushing prices down.”
Sustainable growth
While kernel sales are traditionally directed to countries whose economies are described as stagnating, the potential to expand consumption in these markets was positive, delegates heard.
Alex Whyte, director of Green Farms Nut Company, said that the European Union (EU) had shown 22% growth in kernel sales since 2019. “EU consumers want affordable luxury, and macadamias represent that. Buying the nuts won’t break the household budget, but they still present a premium product.”
Whyte warned that it was important to maintain the premium status of the macadamia while providing both value to consumers and fair prices to growers.
And while macadamia nuts as an ingredient in a variety of products potentially offered an increase in consumption, the industry must take a long-term view on the opportunities on offer to sustain industry development.
Turning to trends in the United States, Shane Hartman, CEO of Global Macadamias, said the market had shown a 50% decrease in kernel sales between 2019 and 2023. He ascribed this to the “dire state” of the American economy.
And while there was promise and sales had increased this year, the competition from other nut products would potentially impact big price increases.
Hartman believes innovation will drive sales in the US market. “The Chinese have developed great snack products, coating macadamia nuts with a host of flavourings. There’s no reason this kind of product won’t work in the US and achieve a premium price,” he said.
Maintaining premium pricing in the Middle East, however, according to the CEO of Golden Macadamias, Mike Benjamin, was key to viable growth. “Kernel prices have increased by 43% since 2019. The Middle East presents the sweet spot for our macadamias, considering its proximity to South Africa in relation to other kernel suppliers, its economic growth, spending power, favourable tariffs and consumption patterns.”
On the avocado industry’s marking strategies in India, president of the World Avocado Organisation Zac Bard said the country was ready to buy into healthier products. “It’s a long-term push to introduce new produce and it takes huge effort and budget. Yet once it gains momentum, the growth is tremendous.”
Julian Mellentin, director of the French company New Nutrition, advised that driving messaging linked to the health benefits of macadamia nut consumption would create advantage. But he cautioned that the messaging should be consistently maintained over the long term rather than changing from year to year.
“Young consumers are losing their fear of fat. Research is increasingly showing that natural fats from whole food sources pose no negative implications for the diet, so we will start seeing changes in fat recommendations. For most consumers, fat is still feared, but for health-active consumers, it’s a virtue. Since macadamias are one of the best sources of good fats, this trend is to our benefit, especially since it is these consumers who are willing to pay a premium for health foods.”
Another angle was mood food. “Mood is a big issue for young consumers who are looking to their diets to improve mood and avoid mood swings. This goes together with blood sugar-friendly food trends, where certain products are sought out to stabilise blood sugar, leading to reduced cravings, improved sleep and a better mood.”
The WMO’s Laing said she had seen some resistance to macadamias in China, where health-conscious consumers considered the nut to be too high in fat. “The WMO is undertaking a project in China to clarify the difference in the oil make-up of the two products, and that macadamias are indeed a healthy choice,” she said.
The right approach
While Bard presented a positive report on the market growth in the avocado industry, he warned that maintaining good prices amid rising volumes could cost up to R40 million per year.
“In 2017, avocado consumption globally was relatively low and consumers didn’t know how to use them or eat them. Global volumes also steadily grew from 180 000 tons in 1995 to 900 000 tons in 2024. Yet prices have remained steady despite the global economic downturn. This year, grower returns shot up by 6% despite an increase in volume from last year. How did we do it? We grew the market.”
The avocado industry’s marketing campaigns focused on consumer education linked to the versatility of the fruit. Social media and influencers played a big role in convincing consumers to eat more avos. Today, they are the most prevalent fruit on social media, with the organisation reaching an average of 31 million people across its four channels.
On the importance of origin marketing, both Bard and Laing warned against it.
“Origin marketing can be very confusing for consumers. It’s important that the product first be established in their minds and consumption grown through generic marketing before moving on to origin,” said Bard.
In summary, while the industry is optimistic that prices will improve in 2025 and the prospects for market growth are good, experts warned that positioning in the market was critical for long-term stability.
Article by Lindi Botha
