2025 Macadamia market
release time:
2025-01-15
Suppliers start the year on a stronger footing this year in a market characterised by shortages, especially in the kernel market. With uncertainty in Kenya around the legal status of regulations managing the flow of macadamias to the market, it is not clear if the country may provide significant stock in the first quarter or not. The world’s buyers could be left waiting until late in the second quarter for kernel demand to be satisfied. This is a very different scenario to the start of 2024 which saw the market characterised by surpluses while suppliers were cash-strapped and eager to make early commitments.
Many processors are considering increasing the proportion of kernels in their output mix this year to take advantage of rising prices. The widening kernel-NIS price spread will also incentivise this move. However, high kernel prices are likely to attract additional supply which could temper further price increases. Increasing demand for macadamia kernels at rising prices during 2024 was underpinned by a surge in food and beauty product innovation using macadamias as ingredients and healthy snacking—a surge in downstream markets that was enabled through price drops in 2022 and 2023. Price sensitivity of these developing markets will be a factor in wholesale price setting in 2025.
This is especially the case with the expected economic slowdown in key consumer markets, such as the United States, Europe and China. While the US economy appears to be responding better to stimulus efforts and may experience a softer decline in the year ahead, the European and Chinese economies are still facing difficulty. Low growth remains in the European Union despite interest rate drops while debt is a concern among some member states. The Chinese economy is battling deflationary trends, declining growth and a property market debt crisis. The malaise is affecting consumer confidence in both economic zones, leading to lower spending. Meanwhile, the threat of a new tariff war sparked by the U.S. Trump administration may add to economic pressure.
The upshot is key consumer markets may not be able to support strong rises in commodity prices in 2025. China’s economic pressures could also affect NIS pricing, especially since a greater proportion of imported NIS is set for domestic processing in China. This requires a careful approach by suppliers in price offers and the critical need to see and understand demand signals from the market.
Source:Internet
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