Macadamia Market Report

A strong growing focus by consumers on health and sustainability has driven the growth of the global macadamia industry, with the organic sector playing a leading role. With consumers increasingly seeking organic food items for superior nutrition benefits, the macadamia nut has become one of the in-demand products as its perceived purity and absence of synthetic pesticides increase demand. The clean label trend continues to support this change by highlighting the significance of being transparent about where ingredients come from. Greater funding in organic agriculture and upgraded distribution networks have boosted the accessibility of organic macadamias for consumers. Moreover, the segment is supported by consumers' readiness to spend on superior products, as organic farming typically results in greater profits for farmers. This combination of health consciousness and eco-friendly practices drives the organic macadamia market's robust growth.

Additionally, health and culinary trends are fuelling the growth of the global macadamia market, with the raw macadamia nuts segment taking the lead. Rich in monounsaturated fats and overflowing with fiber and other essential nutrients, these nuts delight health-conscious consumers looking for wholesome snacks. Their strong flavor and flexible texture will keep chefs and home cooks reaching for them to add enthusiasm to everything from salads to desserts. Plant-based and gluten-free diets have also helped demand for consumers. As the focus on sustainability expands, eco-friendly farming resonates with the environmentally aware shopper. Rising demand in the Asia-Pacific region, specifically in China and India, is fueling the growth of the raw macadamia market due to changing dietary preferences and rising disposable incomes.

Furthermore, the global macadamia sector is set for growth, particularly through enhanced production efficiency and optimized supply chain management. For instance, in June 2024, Kakuzi launched a macadamia oil processing plant with a daily extraction capacity of 1,000 liters, showcasing significant investment in advanced agricultural technology. This move not only diversifies revenue streams but also enhances the overall value chain. The establishment of a processing facility supports local consumption, aiming to double macadamia usage in Kenya. Additionally, Kakuzi’s initiatives emphasize partnerships with local entrepreneurs through shared prosperity models, illustrating the potential for collaborative growth. By improving production methods and streamlining logistics, stakeholders can use these advancements to boost profitability and expand market access for macadamia products.

Soil-borne pathogens such as Phytophthora cinnamomi and Armillaria mellea are the main cause of the substantial risk root rot presents to the macadamia industry global. These fungi thrive in conditions characterized by poor drainage and excessive rainfall, leading to substantial tree mortality. Infected macadamia trees display stunted growth and yellowing leaves, resulting in potential yield reductions of over 50%. The shortened lifespan of affected trees often necessitates costly replanting, disrupting farmers' long-term investment returns. Even the use of fungicides for control has inconsistencies concerning its resistance and effectiveness. Collectively, these factors threaten not only individual farmers’ productivity but also the stability of the broader macadamia supply chain, affecting market pricing and availability.

However, the significant concern is market saturation, as increased production from emerging regions like Africa and Australia could lead to an oversupply, causing price volatility that adversely affects profitability for farmers. Additionally, changing consumer preferences pose challenges; the growing preference for low-fat and nut-free diets reduces the overall demand for macadamias. As more customers look for plant-based proteins and functional foods, Macadamias may find it challenging to keep up with the competition. Furthermore, sustainability issues arise as extensive farming practices can deplete local resources, necessitating a shift towards more environmentally responsible cultivation methods. These factors collectively create a challenging landscape for the macadamia industry.

Major market leaders employ marketing tactics focused on introducing new products, merging with other companies, and acquiring new businesses to grow their customer base and enhance their range of products. In April 2024, Macadamia Beauty made waves in the beauty industry with the launch of their new “Color Care” line, specifically formulated for color-treated hair. The products, rich in macadamia and argan oils, feature Omega 7, a fatty acid known for enhancing hair strength and vitality. Designed to prevent color fading and protect against chemical damage, the sulfate-free line has quickly gained popularity. Initially available online, the Colour Care line can now be found at Sally Beauty stores, expanding its reach to a wider audience.

However, in September 2023, Milkadamia introduced two new plant-based beverages Macadamia Coffee Latte and Macadamia Milk Tea. The Coffee Latte blends smooth macadamia milk with 100% Arabica coffee for a rich, balanced flavor, while the Milk Tea pairs macadamia milk with floral black tea for a refreshing twist. Both products are vegan, sugar-free, gluten-free, kosher, and non-GMO. Sourced from Milkadamia’s regenerative farms in Australia, these offerings cater to the growing demand for sustainable, dairy-free alternatives, using macadamia’s healthy fats and nutritional benefits. Moreover, in March 2023, PlantBaby announced an expansion to its Kiki Milk range with the introduction of a macadamia nut-based variety. This new organic milk alternative features whole-food ingredients, including macadamia nuts, cashews, Brazil nuts, sprouted pumpkin seeds, oats, coconuts, and marine minerals, all without gums, seed oils, refined sugars, or allergens like soy and gluten. Co-founders Alex and Lauren Abelin highlighted the growing demand for nutrient-dense, clean-label products as the driving force behind the launch, offering a fresh take on macadamia milk that’s organic, sustainable, and free from fillers.

The Asia-Pacific region stands as the dominant market for macadamia nuts, driven by rising consumer awareness of health benefits and a strong preference for premium, high-quality snacks. Increasing demand for plant-based diets and healthier consumption patterns is inducing demand in China, Japan, and South Korea. The rising demand for confectionery and bakery products in the food and beverage industries also offers immense potential for macadamia as a premium ingredient. Further demand boosts the interest in cosmetics in which macadamia oil promises to be an attractive product with strong hydrating properties on the skin. Major players like MacFarms and Marquis Macadamias cater to this rising demand, with significant exports into the region, reinforcing Asia-Pacific’s dominance in the global market.

However, North America, particularly the United States, is experiencing rapid growth in the macadamia industry, driven by increasing health awareness and a rising demand for premium, clean-label food products. As per the ‘State of Hawaii Department of Agriculture,’ the macadamia felted coccid, a pest affecting production, is mainly located on Hawaii Island, where more than 90% of the state's macadamia farms are situated. In spite of difficulties, local companies such as Hamakua Macadamia Nut Company and Mauna Loa Macadamia Nut Corporation are succeeding, providing top-notch, eco-friendly choices. Meanwhile, Canada, although smaller in market size, is showing a notable interest in organic, non-GMO, and gluten-free macadamia products, reflecting a growing trend towards healthy snacking.