Macadamia, a dark horse in SA agriculture

The demand for suitable land for Macadamia nuts production has increased sharply and supplies of plants from nurseries are reportedly tight with orders almost two years ahead. Macadamia nuts are without a doubt, the dark horse in South African (SA) Agriculture.

“The shear growth in this sector makes it a product worth watching, it is more than doubling in organic growth on a year to year basis and with that are new jobs and income streams finding their way into the sector,” says Paul Makube, Senior Agricultural Economist at FNB.

Areas in SA that produce macadamias – In terms of market share, the area between Hazyview and Barbeton in Mpumalanga is the largest planted area and accounts for 70% of new plantings. This is followed by the area between Levubu and Tzaneen in Limpopo, and the coastal areas of KwaZulu-Natal. In neighbouring countries, macadamia nuts are produced in Swaziland, Malawi and Zimbabwe.

Annual production – It is estimated that 700 farmers are involved in growing macadamia nuts, supplying 10 cracking factories.

“In terms of output, the industry has seen an exponential growth in the last 10 years, growing production from 4,600 tons in 2015 to 38,000 tons nut in shell (NIS) in 2016,” says Makube.

Export quantities – The industry is largely exported driven with more than 95% of the annual production shipped to international markets. Approximately 50% of the SA harvest is exported as NIS to Asian countries with Hong Kong taking the lion share of 63.3%, followed by Vietnam (32.3%), China (2%) and others (0.3%).

“The remainder is processed to kernel. The USA and Canada are the largest markets for kernel exports while others include Europe, Japan, Southeast Asia and the Middle East, making this a product that is mainly produced for the export,” adds Makube.

The annual financial incomes – The total value of macadamia exports in 2016 was R2.72 billion comprised of R1.12 billion and R1.60 billion of nut in shell and kernel respectively. The weighted average price for macadamia kernel was R22.17/ kg and R63.60/ kg when converted to an in-shell basis, while that for the NIS is R75.68/ kg.

Employment in this sector – Employment in the industry is estimated at 12,500 full time equivalent workers across the macadamia value chain. This includes seasonal workers for harvesting and processing from February through to August.

“The sector is growing organically at an incredible rate, it should further be noted that the area suitable for growing macadamias is limited in South Africa, hence the high demand and surge in the price of viable land, though macadamia is niche, its proven incredibly profitable for producers in this sector,” concludes Makube.

Error: Please enter a valid email address

Error: Invalid email

Error: Please enter your first name

Error: Please enter your last name

Error: Please enter a username

Error: Please enter a password

Error: Please confirm your password

Error: Password and password confirmation do not match

Farmers Review Africa
Farmers Review Africa
%d bloggers like this: