Tuesday, November 29, 2022

Hawaii Farmers Struggle As Worldwide Macadamia Market Goes Nuts

It’s a time-honored ritual for people traveling from Hawaii: a visit to the local grocery, ABC Store or Long’s Drugs to pick up boxes, bags and cans of macadamia nuts to deliver to friends and family as gifts – treats grown in the sun, soil and rain of Hawaii.

But now Hawaii’s most iconic macadamia nut brands are significantly scaling back their purchases of Hawaii-grown nuts. Instead, shipping records indicate, South Africa and Kenya have become big suppliers.

Hawaiian Host Group, which also owns the brand, earlier this year informed Big Island macadamia nut farmers that it was temporarily shutting down its Big Island processing facility in Keaau, “for at least a year or two,” due to costly problems involving a 50-year-old boiler that burns mac nut shells for fuel.

While Hawaiian Host has long imported nuts from elsewhere to supplement its Hawaiian nuts, this year’s harvest would be different: Hawaiian Host would cease buying from Big Island’s mac nut orchards for now, the company’s president and chief executive Ed Schultz wrote in a letter to growers.

“While we are exploring ways to potentially process some crop this year, the closure at Mauna Loa requires us to temporarily suspend receiving any macadamia nut harvest at our Napoopoo Husking Facility until further notice,” Schultz wrote. “Therefore, we understand that you will look for alternative places to sell your crop this year.”

In an email to Civil Beat, Schultz clarified that the company still will purchase about 4 million pounds of Hawaiian mac nuts for the harvest seasons from September 2022 through April 2023.

Still, the letter reverberated through an industry already reeling from high fuel and fertilizer costs, and other issues related to the Covid-19 pandemic. Now local growers are stepping up with a public education campaign urging people to buy locally grown mac nuts.

In the works is a partnership between a local growers’ association and an international firm that tests chemical and molecular properties of things like food and textiles to determine their origin. In the meantime, last week the farmers took out half-page ads in Big Island newspapers calling on consumers to make sure the nuts they were buying were grown in Hawaii.

The ad from the Macadamia Growers of Hawaii didn’t single out Hawaiian Host or any other company, but instead implored readers to check product labels.

“The truth about products you buy,” the ad said, “isn’t hard to crack.”

After seed crops, such as genetically modified corn grown to produce seeds for farms elsewhere, mac nuts were Hawaii’s second most valuable crop in 2021, according to the U.S. Department of Agriculture. Hawaii macadamia nut farmers produced 51 million pounds of nuts valued at $62.7 million from 17,000 acres, the USDA reported.

But this year looks bleak, said Brad Nelson, director of the Macadamia Growers of Hawaii, who is also president and chief executive of Hawaiian Macadamia Nut Orchards, a 5,000-acre operation that employs 180 workers on the Big Island.

“Millions of pounds of macadamia nuts are on the ground and won’t be harvested this year,” Nelson said in an interview.

If the situation continues, Nelson said, the Hawaiian macadamia nut industry could go the way of sugar cane and pineapple: once important crops that have largely disappeared from Hawaii’s economy.

“This is make or break, really,” he said.

Prices Drop Amidst Global Supply Glut

Complicating the situation further, Nelson said, is that Hawaiian Host and Mauna Loa are beloved brands that not only promote Hawaii as a macadamia nut region but also, in other years, buy a lot of Hawaii nuts. Nobody wants to see the brand damaged, Nelson said.

“Up until this year, I would say Mauna Loa would do everything they could to buy local macadamia nuts,” he said.

But that changed with the plant closing. Current farms face two problems now, Nelson said. First, he said, there simply is not enough processing capacity on the Big Island to make up for the lost facility. Second, Nelson said, even if a company like Island Harvest could quickly scale up, Island Harvest likely couldn’t find space on store shelves, which are dominated by Mauna Loa and Hawaiian Host products. 

by Stewart Yerton, Honolulu Civil Beat |  Read more:
Image: Stewart Yerton
[ed. Reminds me of the Kona Coffee branding debacle.]