Honey Market Report
upon presentations for the American Honey Producers Association and the
American Beekeeping Federation
Beekeeping Journal article
The two most salient features of our
honey market are: 1) the production of honey in the US has become more costly,
unpredictable and subject to factors leading to bee disease and bee loss, 2)
the dynamics of the American honey market cannot be understood in abstraction
from the international honey market. I want to make some brief comments
about the current international honey market. The January 2014 issue of
the American Beekeeping Journal provides a broad perspective to which
today’s comments serve as supplement.
In October-November 2012, a few
importers caught in a competitive frenzy entered speculative contracts for
large shipments January through June 2013 at low prices. For various
reasons these speculations proved disastrous. Some beekeepers in
Argentina still have not been paid for honey purchased in support of those
speculations. Many contracts scheduled for 2013 deliveries had to be
renegotiated to higher prices and/or shipments substantially delayed, creating
considerable havoc for American packers. In 2013, about 102,264,555
pounds of Argentina honey were imported into the US.
In the early 4th quarter
of 2013, Argentina’s crop again looked very promising and prospects good,
especially for white honey. However, in the 2nd half of
December, very high temperatures affected availability of electricity needed
for air conditioning, which led to street protests. The wild prairie and
pasture lands near Buenos Aires and Las Pampas, where a great deal of
Argentine’s excellent alfalfa and clover honey is produced, suffered from the
high temperatures and lack of rain. Temperatures, reaching 104˚ F (40˚C)
during the 4 crucial weeks of the second extraction, were the highest in a
century for Buenos Aires. The success of the total crop will depend upon
the third extraction, largely from sunflower and wildflower sources. At
this point we can say that Argentina will not have a "super” crop of honey, nor
will it be as white as the preceding crop. Some people are projecting a
30% reduction in the crop. As of late January, 2014, offers shifted to
colors ranging from 40-65mm.
There is also great concern about
currency, economic and banking stability. Whether these problems will
lead to lower or higher prices, remains to be seen. The sharp inflation
rate of 25% per year, the failures of infrastructural development, the threat
of a national default, and other economic and social problems have led to
political changes in the central government. The combination of 1) the
possibility of a weakening Argentine peso and 2) continuing inflation of about
25% or higher, has exerted a counterintuitive effect, namely making beekeepers
reluctant sellers, realizing that the predicted weakening of the peso means
that they will get more pesos the longer they wait to sell honey. Needing
foreign exchange, the Argentine government instituted measures in December
which would reduce the contradiction between the black market and the official
currency market and give farmers incentives to sell their produce instead of
holding back, on expectations they would receive more pesos in the
future. The current controlled devaluation has moved in lock step with
accelerating inflation. The disparity between the official and black
market rates provided a premium of about 30 - 70% for those operating in the
illegal black market. Argentine exporters, it should be noted, must
exchange their earned dollars according to the official rate.
Dollar/Argentine Peso Exchange Rate
1.00/6.90 $ up 8% in 30 days
It is clear that not only Argentina,
but Brazil, Uruguay and Mexico have turned to the US as a preferred
market. The weaknesses of both the European economies and the Euro
relative to the dollar, which has developed since the financial crisis of 2008,
have caused South America to turn to the US as a preferred export destination.
The European market, which was
unconstrained in its import of Chinese honey in the last few years, has had a
2-tiered price market, one based upon cheap lower quality Chinese honey and the
other based upon European and Argentine honey. Honey imports from China
reached 39% of total honey imports by various members of the EU in 2012.
Overall exports from China increased from about 150,000,000 pounds to
over 250,000,000 pounds from 2009 to 2013. Norberto Garcia, President of
the International Honey Exporters Organization, told AHPA members that "During
the past few years, European honey packers have been facing rising import honey
prices, a weakening of the Euro, and a resistance of supermarkets to increase
the prices of honey on their shelves…and have opted to import cheaper honeys
but of dubious quality.”
Interestingly, EU consumers
responded by reducing their purchases of the lower priced honey and increased
their purchases of higher quality, though more expensive, honey. This
fact may cause European buyers to return to more aggressive purchases of Argentine
honey, boosted by some strengthening in the Euro relative to the US
dollar. In 2012, 19% of the EU’s honey imports were from Argentina.
The recent practice of European
consumers confirms what marketers have long realized, namely, if an industry
underprices its products, consumers’ perception of value is reduced, not
enhanced. The correlative principle is that if you offer consumers an
adulterated, poor quality product, their perception of value will similarly
Average prices for Brazilian honey
were up significantly in the first 9 months of 2013, compared with the same
period in 2012. Total U.S. import volumes from Brazil appear to be
decreasing from their high in 2009. Brazil is a significant supplier for
organic honey sold in the U.S.
The heavy snows in 100 cities in
August, and extreme heat in December, have created problems for the current
crop. Brazil’s northeast is recovering from 2 years of excessive drought
which reduced the production of organic honey. Significant bee losses in
the northeast have been reported. The crop in Maranhão state failed in
2013 and hopes are that honey can be found in Piaui state in 2014. The
shipment of at least 30 containers of organic honey (about 1,250,000 pounds)
scheduled for 2013 were significantly delayed or cancelled. Even with a
good crop there will not be as much organic honey as the market demands,
according to Brazilian reports. The weather so far in 2014 has been good.
Total US imports from Vietnam in
2012 fell about 25% relative to 2011. However in 2013, imports reached
about 71,000,000 by year end. Vietnam continues to be a major source of
industrial honey by offering reasonable prices for its light amber.
As its honey industry has developed,
new floral sources such as Acacia Mangium have become important. This
honey source may account for over 35% of the total Vietnamese crop. It
tends to be on the dark side of light amber and darkens rapidly over
time. This has made it difficult for Vietnam to ship honey for arrivals
in the 1st four months for each of the past 3 years. Exporters
are working on experiments for blending floral sources in a manner that will
allow availability of the quantities, colors and color stability needed in the
US industrial market. The Vietnamese honey industry is working closely
with western scientists.
India was the 2nd largest honey
exporter to the US in 2012 and US imports for 2013 were reported at about
54,327,000 pounds. Over 50% of the Indian honey imported is ELA in color,
and falls into the lower price category for ELA. Prices averaged about
$0.25/lb. less than Argentine ELA. From January to October 2013,
India exported 8,328,500 pounds of white honey to the US at an average price of
$1.29/lb. India’s honey export growth from zero about a decade or so ago
is rather astonishing.
As of September 2013, 15,351 metric
tons of white Canadian honey entered the US at prices averaging nearly
$2.00/lb. This compares sharply to import values of $1.29/lb. for white
honey imported as Indian, as noted above.
Imports from Canada in 2012
increased in volume significantly over the previous 3 years, and reached
21,400,000 pounds in 2013. Ontario beekeepers are reporting bee losses of
50% and neonicotinoids in the water and environment have been blamed as the
cause of the losses. The production dilemmas faced in Canada are similar
to those of their neighbor to the South.
Imports from all Countries
In 2013, the total volume of
imported honey in the U.S. was 332,376,726 pounds (about 150,771 metric tons)
and imports represented about 70% of the total US honey consumption.
Accordingly, import assessments provide the major financial support of the
marketing efforts of the National Honey Board.
US Honey Production
A number of us in the industry, with
the assistance of scientists and economists, are looking to develop a deeper
understanding of 1) what are the variables that are negatively affecting honey
production and 2) how those conditions may be overcome and bee health and honey
productivity increased. US honey production has declined from over
200,000,000 pounds to around 150,000,000 pounds, plus or minus 10%.
Productivity declines per hive contribute to the overall reduction of the crop.
Recent studies indicate that bee
losses may be linked to a mutating virus, related to the tobacco ringspot
virus, that jumped from tobacco plants to soy plants to bees, according to
researchers at the USDA laboratories in Beltsville, Maryland.
Dr. Dennis vanEngelsdorp, from the
Department of Entomology at the University of Maryland, spoke to the ABF
convention and summarized the problems facing bee populations as "the 3 Ps,
that is, Parasites, Pesticides and Poor feeding.”
Steven Dwinell, Assistant Director,
Division of Agricultural Environmental Services in Tallahassee, Florida,
described for AHPA members the tense situation in protecting both the citrus
plants and bees producing citrus honey. Citrus groves in Florida have
experienced up to 40% tree losses and growers must protect their orange trees through
use of pesticides. Those pesticides are devastating to bees. The
Asian Citrus Psyllid threatens citrus groves in Florida, and is spreading to
Texas and California. In Florida they are using internet mapping to alert
beekeepers to move bee colonies in advance of pesticide applications.
Maybe the growers and the beekeepers can be friends, just like the "farmers and
the ranchers” in the
song from the classic musical "Oklahoma!”
Circumvention and Legal Issues
The beekeepers and packers are
monitoring new types of circumvention, and have their eye on Turkey as it
expands honey exports. U.S. imports from Turkey reached 3,300,000 pounds
between January and October, 2013, with an average import price of
$1.18/lb. Turkey’s honey was exported to Germany at prices reaching
$3.17/lb. and Turkish domestic sales averaged $2.00-2.70/lb. in recent
years. As Eric Wenger of True Source Honey reported, "while Turkey’s
exports to the world declined in the past 5 years, their exports to the US
increased dramatically, clear evidence of circumvention, just as observed in
Malaysia and Indonesia in 2010.” Traditionally Turkey has exported honey
to Germany, whose post World War II population includes a large number of
people from Turkey.
Attorney James Pizzirusso, of
Hausfeld, LLP, reported to beekeepers attending the ABF convention in Baton
Rouge in January 2014 that the beekeepers’ complaints for damages against Groeb
Farms and Honey Solutions are ongoing and the scope of inquiry extends to those
who allegedly were interlocked in complicity and co-conspiracy to commit
customs fraud with those two companies. These class actions suits address
the collusion of many players and diverse strategies to circumvent honey and
avoid anti-dumping duties.
During the past decade and more there
have been innumerable schemes of fraud ranging from false bills of lading,
country of origin, quality inspection, invoices, wire transfers, corporate
identity, product description, and audit information. Schemes of fraud
led to deferred prosecution agreements, a march to monopoly and a
bankruptcy. Those who genuinely seek a level playing field must be
sobered by the difficulties in maintaining a fair playing field, and ensuring
that honey trade is conducted according to U.S. and international law.
Global Weather Patterns and
Unusual weather conditions, such as
the most extreme drought in California in a century, heavy winter storms and
extreme cold in parts of the U.S., Argentina’s most severe heat wave in a
century in 2013-2014, Australia’s drought, and Brazil with 100 cities
simultaneously suffering snowstorms, point to: 1) the volatility, severity and
unpredictability of global weather patterns and 2) vulnerability of global
agricultural production to global climate change. According to government
statistics announced in mid January, 2014, 2013 was the 4th hottest
year in recorded history. Fourteen of the hottest years since the 1890s
occurred between 1998 and 2013. For the US, it was the 37th
warmest year on record. But climate change is a global phenomena.
Recent international reports,
including the UN global climate report, have linked global climate change with
potentially devastating effects on global agricultural production, which is
feeding the global population of approximately 7 billion people.
World honey production in 2011 was
about 3.6 billion pounds, with about 1.6 billion pounds produced in Asia.
Asia is the only world region reporting significant increases in honey
production since the year 2001, when Asia produced 1 billion pounds.
The Hive and the Honey Bee
This year should see the completion
of a new edition of The Hive and the Honeybee. The previous
edition of this important publication was in 1992. A great deal has
changed as the world’s economy has become more integrated, complex and in many
respects, characterized by various forms of tension. Dr. Stan Daberkow, a
former economist of the USDA, and I are writing a chapter on the marketing of
honey in America.
Topics of Interest include, briefly:
· Changes in production and the emergence of new producing
areas and the correlative loss of traditional areas.
- Changes in the consumption and perception of
- Impact of global climate change on honey
- The need for harmonized, integrated and reasonable
tolerance and testing levels for honey residue testing, bringing it in
line with other foods. If "honey is the soul of a field of flowers”
we must scientifically investigate how the interaction between zoological
and diverse botanical forms of life affects the complex and highly
variable chemistry of honey.
- Honey and health as part of the movement for healthy
natural foods. Honey is in a competitive relation with natural and
non-natural sweeteners. We need to improve the scientific understanding
of the chemistry of honey, its appeal, and it health attributes and
advantages relative to competitive sweeteners.
- New products, new themes, learning from other nations
and cultures in developing an international market for pure honey.
- Export of American honey to the global
marketplace. The percentage of U.S. honey that is exported has
remained constant at 2% of production. The potential, however, may
be expanding in coming decades.
- Qualities and food safety issues. Some restricted
substances include naturally occurring components. Non-tariff trade
barriers in the context of the World Trade Organization’s mandate to
reduce such barriers, changes in the antidumping regime.
- Food Safety and Modernization Act for US food
facilities and foreign food facilities. This act will increase the
responsibility of companies acting as importers of food products.
Traceability of honey and quality control from the producer to the
processor are going to be monitored and verified by auditors.
- Legal issues, international trade law, creation and
maintenance of a level and fair playing field. We have seen
penalties for circumvention, huge fees for avoidance of antidumping
duties, jail time, loss of reputation, systematic deception and
hypocrisy. Legal scrutiny of the honey marketplace will increase,
not decrease, until the bad actors are unable to gain unfair competitive
- Honey labeling is becoming a critical
issue. Fraud in respect to honey’s country of origin, in
respect to labeling where honey is prominently used as a primary
ingredient when it is in fact a minor constituent among multiple
sweeteners, and in respect to the purity and authenticity of honey being
sold as bee’s honey. Non-American honey is being sold as American
honey. If exporters continue to ship unsafe, mislabeled and fraudulent
products, then their participation in the important North American and
European markets will be diminished.
- The issue of Non-GMO labels is becoming an issue in
Europe and in US states.
- Multinational ownership in the US food industry,
including the honey industry, is to be expected, involving vertical and
- Marketing of Honey – incorporating honey into beverages
and new food products.
- Marketing to ethnic groups in the USA
- The valuable role of the National Honey Board in
expanding total and per capita consumption of honey and the consumer’s
perception of honey’s value, quality and health benefits.
Industry members with information
and suggestions regarding the above topics are encouraged to contact me by
email with their comments.
The Bees, their Honey, and the
Migratory bee practices are used in
the US, Argentina, Canada and elsewhere. These practices are increasing
the stress on the bees, as monodiets are doing. To protect bee
populations and plants from disease and also to provide adequate feed
throughout the year, the use of pesticides and external feeding regimens for
pollinators are becoming increasingly imperative. Protection of both bees
and the plants they pollinate, and the diversity of feeding parameters, are
inevitably expressed in the diverse chemical profiles found in honey.
Beefeeds change, and these changes affect the chemical profiles of honey
itself. The international global honey market, if it is going to have
adequate and continuous supply of honey, will have to develop standards that
take these realities into account. If we could increase the creative
marketing of honey, but do not establish reasonable and realistic standards for
residues and the natural diversity of chemistry found in honey, our marketing
efforts will represent a pyrrhic victory. It is essential that the
international honey market, including the American honey market, moves to
establish such standards.
The protection of vulnerable bees inevitably
implies that, except for ultrafiltered honey, which is illegal to sell as
honey, honey does not exist in a Mythical Realm of ultrapurity. The honey
industry, like other food industries, must establish either or both realistic
tolerance levels or testing limits that are based upon an assessment of ADI
(average daily intake). This is essential for domestically produced and
foreign imported honey. More and more members of the honey industry,
whether producer, packer, importer or exporter, are facing this fact and trying
to take a pro-active and pre-emptive measure to introduce some realism to guide
the international and domestic flow of honey.
There are new forms of cooperation
and collaborative efforts among scientists, beekeeper and farmers to protect
the pollinators whose vigor is essential to agricultural production of
anti-oxidant fruits, tree nuts and vegetables.
The National Honey Packers and
Dealers Association has initiated consideration of a dialogue with the U.S.
government to address the need for testing and/or tolerance levels. Such
efforts typically require considerable expense, considerable time and the ears
of thoughtful members of Congress. Since there is a broad coalition of shared
interests, such efforts afford opportunities of effective collaboration among
packers, beekeepers, importers, exporters and related trade associations.
The sooner such efforts begin, the sooner positive results will be
achieved. The broader the cooperation among all groups sharing common interests,
the more likely the efforts will be successful.
Despite difficulties in U.S.
domestic honey production in 2013, the total consumption and total value of the
American honey industry has maintained a pattern of growth, irrespective of
macroeconomic conditions, over the past decade. That is the good news.
CPNA International, Ltd.
1043 Oyster Bay Road
East Norwich, New York 11732