In a year where international trade has been massively disrupted by COVID-19, the Beekeeping industry has become a rare bright spot on the economic horizon. Exports of honey from New Zealand surged by 33% in 2020-21, reaching $506.8 million.
‘The small size of the domestic market means the Beekeeping industry is heavily export oriented. Demand from overseas markets now accounts for over 75% of industry revenue, up from approximately 60% five years ago,’ said IBISWorld Senior Industry Analyst, Matthew Reeves.
Manuka mania
Manuka honey is the most popular honey variety exported by New Zealand, accounting for almost 90% by value in 2020-21. Growing demand for the product as a result of its perceived health benefits has contributed to a strong rise in manuka honey prices as well as volume of demand. China is the largest export market for New Zealand honey, accounting for $96.5 million, or 19.0% in 2020-21. The United States accounts for the second largest share, with exports during the year worth $77.8 million. The United Kingdom and Japan round out the top four. The 33% growth in industry exports in 2020-21 was the largest rise since 2015-16.
‘The outbreak of COVID-19 was a significant driver of this growth. The perceived anti-viral and immunity-boosting properties of manuka honey have driven growth across all the aforementioned markets, as well as many others,’ explained Mr Reeves.
However, the lucrative nature of manuka honey compared with other varieties has led to a spike in alleged fake manuka honey. Some producers have used small amounts of manuka honey diluted with other, non-manuka varieties, to drive sales while keeping costs down. Consequently, the Ministry for Primary Industries (Manatu Ahu Matua) introduced a stricter definition in December 2017. This has led to an oversupply of non-manuka honey, reducing prices for these varieties by as much as 50%, and constraining industry revenue growth over the past three years.
Manuka legal battles
The name ‘manuka’ is the Maori name for the tree from which bees derive the nectar. The New Zealand-based Manuka Honey Appellation Society (MHAS) has launched an international trademark dispute in order to stop Australian honey producers from using the name. However, Australian manuka honey producers argue that as the tree is native to both New Zealand and Australia, they should be entitled to use the name. The New Zealand Government has backed the legal fight, providing a $5.7 million grant to the MHAS, with $1.4 million going directly to the legal dispute. The Intellectual Property Office of New Zealand is due to consider the case in August 2021.
‘China and the United States are Australia’s two largest export destinations for honey. Therefore, a ruling in favour of New Zealand could significantly harm Australian manuka honey producers. The loss of instant name recognition and the cost of rebranding to another name, such as Tea Tree honey, would set Australian producers back, both overseas and in the domestic market,’ said Mr Reeves.
Beekeeping outlook
The Beekeeping industry in New Zealand is projected to grow at an annualised 3.3% over the five years through 2025-26, to $723.5 million. Industry-wide profitability is also forecast to increase, driven by surging demand for manuka honey. However, growth in exports is forecast to return to normal levels in 2021-22, after tremendous growth in the prior year.
‘Post-pandemic consumer habits are anticipated to revert to pre-pandemic levels. However, the longer the pandemic lasts around the world, the more ingrained new habits around healthy eating will become, benefiting New Zealand’s manuka honey producers. A favourable outcome in the trademarking dispute would also assist industry exporters in New Zealand,’ concluded Mr Reeves.
IBISWorld reports used to develop this release:
For more information, to obtain industry reports, or arrange an interview with an analyst, please contact:
Jason Aravanis
Strategic Media Advisor – IBISWorld Pty Ltd
Tel: 03 9906 3647
Email: mediarelations@ibisworld.com
