South African Macadamias Face Tough Choices: Domestic Processing vs Export Shift

The global nuts market is undergoing significant change, with South Africa’s macadamia sector at the heart of critical industry shifts. Once characterized by rapid expansion and robust profitability, the sector is now transitioning into a period marked by growing pressure on margins, the risk of deindustrialization, and the need for operational efficiency. Duncan Allen of Green Farms Nut Co, speaking at the recent Ambermacs Macadamia Expo, highlighted how soaring exports of high-cracking-value in-shell nuts to Asia threaten to undermine South Africa’s own processing industry.

This move, driven by strong off-shore demand, risks transforming South Africa from a world-class value-adding nut processor to a mere supplier of unprocessed commodities. As domestic factories risk underutilization and potential closure, the challenge for growers and processors is no longer about chasing historic price highs, but about survival through precision farming and cost discipline. Stakeholders are urged to refocus on local processing and value-added products to maintain long-term sector resilience, even as global economic headwinds persist and competition from expanding orchards mounts across the continent.

📈 Prices

 

Product	Origin	Delivery Terms	Current Price	Weekly Change	Market Sentiment
Brazil nuts (medium)	NL	FCA, Dordrecht	6.50 EUR/kg	0 EUR (Stable)	Neutral

🌍 Supply & Demand

• South Africa remains the world’s largest macadamia producer, accounting for the largest export volume globally, with shipments mainly to Asia, Europe, and North America.
• The sector historically focused on value-adding steps such as local cracking and kernel exports, but shifting Asian demand is driving a rise in in-shell nut exports.
• Between 2010 and 2022, macadamia orchards in Africa soared from approximately 17,000ha to over 80,000ha – a testament to prior high prices and favorable investment conditions.
• Demand and prices have declined from their historic peaks, with over-supply and economic pressures causing a market reset. Supply growth is forecast to stabilize by 2032.

📊 Fundamentals

• Exporting high-cracking-value nuts erodes local processing margins and shifts value addition offshore, threatening industry skills, plant capacity, and financing.
• Sector consolidation is likely to accelerate between 2026 and 2028, with a wave of asset write-downs and potential farm sales, especially among higher-cost producers.
• The short-term outlook is for profits driven by efficiency measures—advanced irrigation, fertilization, and cracking percentage improvements—rather than price rebounds.
• Value-added kernel product development and precise market targeting are vital levers for future revenue.

☀️ Weather & Yield Outlook

• South Africa’s primary macadamia regions (KwaZulu-Natal, Mpumalanga, Limpopo) benefit from improved cultivars and competitive cost structures, offering resilience during market turbulence.
• Current weather patterns signal relatively stable conditions for 2024 harvests, though the ongoing need for irrigation management remains high due to localized drought risk.

🌐 Global Production & Stock Comparison

Country	2022 Estimated Production (tons)	Stock Trend
South Africa	~60,000	Growing, but stabilizing
Australia	~55,000	Steady
China	~35,000	Increasing
Kenya	~38,000	Rising

💡 Trading Outlook & Recommendations

• Growers should avoid expecting a return to previous price peaks; focus instead on operational efficiency and disciplined cost management.
• Producers in established, low-cost regions are best positioned for the coming consolidation wave.
• Maintaining domestic processing is critical for long-term sector viability and the preservation of value-added benefits.
• Monitor Asian demand trends closely, as further in-shell export volume increases may harm domestic industry sustainability.
• Consider exploring and investing in value-added kernel products to diversify revenue streams.

📆 3-Day Regional Price Forecast

Exchange/Market	Product	Forecast Price Range	Direction
Spot (NL)	Brazil nuts	6.50–6.60 EUR/kg	Stable/Soft
Local (ZA, Indicative)	Macadamia kernel	Web/Vector data required*	Stable (Efficiency-driven)

*No direct current price from Raw Text; supplementary sources suggest stability with weak upside.