Tuesday, April 23, 2024

Sweet surprise for honey firms

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A surge in consumer demand for honey,  particularly manuka, has given a welcome boost to prospects for one of the country’s largest producers, coming on the heels of a good harvest season. Strong demand in March for Comvita propolis and manuka honey products resulted in on-line sales growing by 70% in 10 days. 
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That did much to offset the losses experienced in retail sales and the major drop in sales to tourists in New Zealand.

A month later Comvita chief executive David Banfield says the initial surge has continued, resulting in strong sales gains that delivered double digit growth with good sales across all major markets. 

The challenge for the industry is to maintain the high quality consumers now expect from manuka honey.

“We are confident with our strict manufacturing protocols and largely undisrupted logistics network we can continue supplying our customers across all our markets.”

Covid-19 has made consumers re-assess their priorities and the health of themselves and families will become an even bigger priority for discretionary spending.

“This should benefit natural products like manuka honey, propolis and olive leaf extract.”

Unique Manuka Factor Honey Association spokesman John Rawcliffe said the industry now has one eye on global market prospects three to four months out as consumers adjust incomes to what could be a more austere income environment.

“Sales have been very good during this period. Our initial concerns were ‘can we harvest and look after hives?’ which the Government said we could. Then it was ‘can we ship the honey?’, which despite a higher cost we are able to do and consumers are buying it.

“But looking further out we need to know we have distinguished our NZ manuka from other countries’ honey when that discretionary spend drops. If we do not continue to protect the term NZ manuka, consumers will just go for a cheaper product.” 

Rawcliffe said there is much work going on to re-examine manuka packaging and labelling, including moving proposed health benefits more to the front of the labelling.

In a recent report on food industry response to covid-19, KPMG agribusiness global head Ian Proudfoot said consumers will increasingly seek food products that build immunity and minimise the risk of contagions, requiring an emphasis on helping consumers discover unique health benefits of different food products.

That includes highlighting nutritional benefits and moving them from the back to the front of packaging.

Rawcliffe said that is exactly what manuka producers are working on and making the manuka standards determined by the Ministry for Primary Industries clearer to consumers.

The sector is doubling down on efforts to protect the NZ Manuka proprietary brand, which has already gained statutory protection in the United Kingdom Trade Registry.

Last year the industry welcomed an injection of almost $6 million to help maintain NZ Manuka’s provenance claims as it faces threats from Australian and South American production. The funds are also being used to put more science into proving health claims and purity standards.

Banfield said Comvita is working as an advocate for protecting manuka honey provenanc and he was proud of the work done to date.

ApicultureNZ chief executive Karen Kos said there is also some indication the rising manuka tide has lifted all boats in the domestic honey industry.

Conventional honey prices have been at all-time lows in the past year, barely fetching $3.50 a kilo despite a $6-$7/kg breakeven needed.

“We are also getting reports of increased demand for all honey types at local retail level, which is encouraging. It is seen by consumers as a natural, healthy product and it has been moving off supermarket shelves strongly.”

Producers had two years of lean returns before  the covid outbreak. 

Kos said prices are not where they need to be yet but are strengthening.

However, she cautioned any rise domestically in sales is offset by the loss of tourism sales.

“And we have advised our members about their options including leaving some honey behind in hives over winter. We are also at least in the fortunate position we can keep operating as an industry, maintaining hives and looking after bee populations.”

After varroa mite infected NZ hives in the early 2000s it is now impossible for bees to exist without human intervention to control varroa levels. 

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