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Honey market in a state of flux

An average volume of manuka honey and a drop in quality is the message Gisborne beekeeper Barry Foster has been getting from beekeepers and honey producers.

A slump in honey prices has probably been caused by the international problem of fake and adulterated honey, he says.

“This is not honey from New Zealand but from other countries where it has been doctored with sugars. The product is offered at cheaper prices.

“The risk is that in the long term consumers lose trust in the product.

“Damage to reputation is the first thing but the flow-through impacts the economics of beekeeping globally and of food crop pollination.”

The New Zealand honey industry has grown on the back of manuka honey.

“We are affected by international pricing.”

Last year manuka prices slid by as much as 50 percent compared to the year before, and some processors now have major stockpiles of the higher-value honey in bulk storage, Arataki Honey director Russell Berry told Farmer Weekly.

While large volumes of adulterated Chinese honey in global markets have been blamed for the price plummet, the New Zealand Government's ruling that honey marketed as manuka could no longer be blended with other honey varieties is also said to have contributed to the price drop.

In 2017, the Government laid down specific criteria to ensure manuka honey was authentic. Prior to the establishment of four specific chemical markers and one genetic marker to ensure authenticity, honey marketed as manuka could be blended with other honey varieties.

The export market

With a tiny window for bees to produce manuka honey, weather conditions this summer resulted in an average year for producers, says WildCape Manuka Honey beekeeper Bill Savage.

“You've got three to four weeks to get your crop. The weather wasn't that great through December. It was good through November and January — it was good early and late, slow during the middle.”

Manuka honey export markets are slowly growing in the UK, US, Singapore, Hong Kong and Japan, he says.

“Coronavirus has almost been beneficial to manuka sales as people look for something to enhance their immunity. From what I've seen, sales are up since the outbreak.”

Most manuka honey forgery happens offshore but it is a big problem.

Despite the massive increase in sales of manuka honey and related products, manuka honey is still largely unknown overseas.

“Fewer than 1 percent of the world's population knows about manuka honey. Japan takes more than 100 tonnes of manuka honey from New Zealand but the percentage of the population who know about it is tiny.

“Most people outside of New Zealand aren't exposed to the publicity.”

Manuka honey is one of the most forged products in the world, he says. At No.1 is counterfeit olive oil followed by milk powder.

“As long as there's a buck to be made, someone will produce it.”

The East Coast flavour

Weather conditions over summer resulted in an average year for manuka honey production but this is factored into the sales forecast, says WildCape Manuka Honey's processing operations, sales and marketing and export logistics manager Simon Gardiner.

WildCape always has stock in climate-controlled storage. This might not be so much to meet a perceived shortfall but to enable dihydroxyacetone (DHA) to convert into methylglyoxyl (MGO), the main chemical responsible for the unique non-peroxide antibacterial activity of the honey. DHA is a precursor chemical of MGO.

Manuka honey can be stored in drums for up to 12 months before it is packed in jars.

“Storage is standard practice because the value of manuka honey increases as methylglyoxal increases. That means we have stored honey at all times.”

The problem of manuka honey forgeries seems to have slowed thanks to the Ministry for Primary Industries' (MPI) scientific definition to authenticate monofloral manuka honey, says Mr Gardiner.

“MPI's scientific definition for manuka honey has been a good thing for us. We're seeing fraudulent products come off the market.

“Previously, people could export any honey as manuka.”

WildCape's single-source manuka honey is harvested entirely from the business's own hives on the East Coast, says Mr Gardiner.

While many other companies bulk-blend manuka honey from a variety of sources, which can affect flavour, one particular feature that makes the East Coast brand unique is its taste, says Mr Gardiner.

This can be attributed in part to terroir. Normally associated with wine, the French word describes environmental factors and the effect they have not only on the taste of wine but on foodstuffs such as manuka honey.

The East Cape region's warm climate, fertile soils, rugged topography and coastal proximity contribute to that, says Mr Gardiner.

“Every region in New Zealand produces manuka honey with a different flavour profile. Manuka honey from the East Coast is highly regarded for its mild and balanced flavour.”

East Cape honey is also high in dihydroxyacetone, the precursor chemical for MGO, he says.

When a bee feeds on and digests the nectar, that conversion takes place. The higher the MGO, the higher the UMF rating.

“We not only have to consider MPI's manuka honey definition. We must also ensure we meet UMF (Unique Manuka Factor) analysis for the unique signature compounds present in high-quality, authentic manuka honey.”

With the implementation of a scientific standard, the New Zealand Government can control the quality of manuka honey exported from this country but not of that from other countries such as Australia, says Mr Gardiner.

“This is why there is now a focus on trademarking the name ‘manuka'.”

Granted $5.7 million through the Provincial Growth Fund, including a $1.7 million loan, the Manuka Honey Appellation Society is working to secure international property rights to the name “manuka”.

A mixed bag

The 2020 season has been a mixed bag for Ngati Porou Miere (NPM), says NPM chairwoman Huti Watson.

After two to three years of lower-than-anticipated honey production for NPM, predictions for this season remain cautious, she says.

Apiculture NZ has reported that while long-term global demand for health and welfare products is positive, manuka honey prices had dropped as much as 25-50 percent on the previous season.

“Although this report paints a less than glowing picture, Miere, like other honey entities, is feeling the impact of market and nature forces,” says Ms Watson.

“Manuka honey regulations continue to affect the market in pushing up supply of honey, coupled with increased numbers of beekeepers and beehives.

“Increased numbers of beehives are boosting bee population in New Zealand, while in other countries bee numbers are falling due to contamination of land and climate change.”

Large and small honey operators are working within difficult market conditions and even manuka honey giant Comvita experienced an operating loss of $7.6m.

“Comvita cites a drop in manuka honey stocks, a third poor honey season in a row, and the Chinese crack-down on the daigou trade, coupled with tighter specifications on exports of branded honey, as reasons for deficit,” says the NPL chair's report.

Daigou means “buying on behalf of”. It is an e-commerce channel between mainland Chinese buyers and overseas professional shoppers.

Small beekeepers continue to struggle to sell honey and many continue to stockpile rather than sell at under-cost, said the report.

“In addition, it is predicted more will go out of business over the coming 12-24 months. The impact of MPI's honey definition introduced in 2017 has been blamed for the continuing poor business outcomes.”

Riding the manuka wave

Beebox honey producer Michael Burt suspects the slump in manuka honey exports is due in part to a cooling off of the hype around the product.

The market for manuka honey in 2015 was red hot but there was a lot of concern there were no criteria to determine a standard for manuka honey, says Mr Burt.

China said it would shut down manuka honey imports unless New Zealand had scientific markers. MPI took three years to finalise a scientific definition, during which time not much manuka honey went out of New Zealand.

Prior to the scientific standard set by MPI honey exporters actively sought out dark, strong-tasting bush honey which has a similar colour and taste to manuka honey.

“Larger, more reputable companies produced stuff more true to label, but a lot of exporters got away with what they could in the absence of definite standards.”

Most producers were happy with the new standards but the markets' initial enthusiasm seems to have dimmed a little, says Mr Burt. While he feels hype-driven products do not get a second chance at “re-hyping” the product, Mr Burt believes manuka honey is a good product and the long-term future is good.

“I think all New Zealand honey was riding the manuka wave,” he says.

“My feeling is the global hype has gone down. At the moment we're in a period of correction.”

GOOD FUTURE FOR MANUKA HONEY: Along with other Gisborne and East Coast beekeepers, Beebox honey producer Michael Burt has experienced a slump in honey prices, which is a reflection of the international market. He believes the long-term future for manuka honey is good however. Picture by Liam Clayton

  1. Val Nicholson, Hawke's Bay says:

    It would be interesting to see honey products other than manuka talked about as well. Don’t forget the poor beekeepers who produce the light amber clovers – we are the underdog in the honey industry, and produce a lot of the lighter blends.