Jun 08, 2023

It’s the moment for macadamia nuts

Natural disaster threats and competition pose challenges for what’s known as “the king of all nuts,” but experts agree that the market’s potential is promising.

The macadamia market is growing fast as consumers turn to the nut, which boasts a bounty of nutritional benefits, as a healthy snack option.

The increase of consumers’ interest in plant-based proteins is also a factor in the meaty little nuts global popularity. Demand for macadamia nuts is expected to grow from $1.45 billion in 2023 to $2.43 billion in 2028, experts predict.

Celebrated for their rich creaminess, the nuts are versatile and used in everything from baking to savory sauces and even cosmetics.Macadamia nut milk is a growing popular item even in mainstream grocery stores.

The biggest barriers that have prevented the nuts to be included in many products has been supply and cost. But recently, the growth of macadamia farms has increased exponentially. Contributing to this increase is that fields for things like tobacco, sugarcane and coffee are being replaced with macadamia trees.

Macadamia nuts are actually edible seeds produced by the tree of the same name, and are native to Australia. They thrive in warm temperatures and rainfall, and are largely produced in South Africa, Australia, Kenya, China, Hawaii, Guatemala, Malawi, Vietnam, Colombia, New Zealand and Swaziland.

Food producers have been eyeing the potential of the macadamia nut recently, but, it’s not the easiest nut to produce, which is partly why the nut is so pricey for consumers.

“They are declining in acreage here in California because of water, land, and labor costs, but expanding in places like Australia,” said Ben Faber, farm advisor for University of California Cooperative Extension, Ventura/Santa Barbara Counties and Southern California, responsible for subtropical tree crops including macadamia.

The nut has long struggled with heavy rains, bug infestations, and now faces increased risks of wildfires in some of the most favorable places the trees thrive: Australian and Hawaii.

This month, the island of Maui on Hawaii, experienced devastating wildfires. Though Macadamia nut acreage is predominantly on the Big Island of Hawaii, Faber explained, and the fires were in Maui, sellers in the area expressed growing concerns about fires across the islands.

Ipek Erdogan-Trinkaus, Chief Commercial Officer at Milkadamia, works with the company Jindilli Beverages. Jindilli is an indigenous word for macadamias, and the beverage company makes macadamia milk, and lattes, among other products from growers in Australia and South Africa.

“It is a commentary on climatic uncertainty that it is no longer safe to source from only one climatic region,” their website explains. According to Erdogan-Trinkaus, the industry is looking up. “The macadamia industry is expected to continue growing in the next decade. As the industry is currently expanding with new players in the macadamia farming landscape and abundance in stock following the pandemic, the nut could become available to new audiences from a geographic and slowing down in price perspectives,” she said.

The trees themselves have a longer setup time to some crops, which growers take into consideration in pricing the nut — it takes two years from seed to plantable tree, then 4-5 more years before they produce nuts, Hawaii Public Radio reports.

Cashews, almonds and even walnuts, tend to be more affordable, making macadamia products less popular with consumers, Faber warns.

“That’s the problem,” Faber said. “They taste good and have a lighter taste than walnuts, but they compete with cashews and almonds which are both currently cheaper.”

Consumers using, for example, would pay $22.99 for a pound of macadamia nuts, but just $9.99 for a pound of almonds — both types roasted and salted for snacking.

Erdogan-Trinkaus points to sustainability values in macadamia nut producers as a factor that sets them apart and could be a factor for consumers increasingly concerned about their food choices and sustainability.

“Big producers of macadamias, like Milkadamia at their farms in Australia, are very thoughtful about the sustainable way of producing. Milkadamia and industry players see no trade-off between sustainability and productivity, unlike many competing crops,” she says.

Producers are moving far beyond macadamia nut cookies, into a wider variety of sweet and savory products, along with beverages. Faber adds that trail mixes, ice creams, and other snacks are integrating the nut into new products.

“With an increased demand for superfoods, healthy snacks, and plant-based ingredients, combined with the current trend for increased availability of macadamias, the future brings a lot of innovation,” said Erdogan-Trinkaus. “There is potential for the use of macadamias in many CPG categories, and we think that should be accounted for.”

She believes there is a wide frontier available for using macadamia milk, as it has unparalleled creaminess and “versatile texture,” making it ideal for coffee drinks especially.

Consumers are valuing nutritious and filling foods, especially those with healthy fats that are “highly satiating” like this nut, said Erdogan-Trinkaus.

“With the continuous growth of demand for superfoods, healthy snacks, and plant-based protein, we see consumers valuing the nutritional component of macadamias.”