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frazzledfozzle

World honey prices

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1 hour ago, Rob's BP said:

.

Honey production in Canada. Low cost, high volume and a few large buyers. Cheap but lots. 

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17 minutes ago, Nuc_man said:

To true Adam I only wanna sell 50 ton if I need halal or kosher, umf I give you a call...think I will just be nz beekeeper packing my own honey selling to the people in my own bck yard sold 10 ton so far @ a great kg rate giving the courier something to do, local label shop some work supporting local sports teams bla bla etc.

So my local sales up by 8 ton this ytd. 

Only got 40 ton p/a to find a home for game on ....

 

 

That's it @nuc_man, that is the model for the small to medium sized beekeeper.  

 

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36 minutes ago, flash4cash said:

What we have going on right now is desperation.  Most beekeepers are dead financially.  It makes it make no sense to be another brand selling honey in a jar.  Do not do that; that is dumb.  Race to the bottom. 

 

Building a brand require significant financial investment and time. It takes years. 

 

I disagree that the supermarket is the most powerful player. Comvita has the best brand for Manuka.  If the supermarket does not stock it then they lose sales.  That why they can charge the most for the same product in a different jar. International customers want Comvita, not Bob's manuka. 

 

NZ needs one strong brand, probably Comvita.  That is it. We all invest and supply (and not over supply ) in that. 

 

 

 

 

Comvita a poor example. Even these guys can't make a profit. 

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1 minute ago, CraBee said:

That's it @nuc_man, that is the model for the small to medium sized beekeeper.  

 

Until everyone does it. 

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6 minutes ago, Gino de Graaf said:

Comvita a poor example. Even these guys can't make a profit. 

They can not make a profit in beekeeping owning hives.  They can make an awesome profit in brand sales of honey. 

 

They realise this which is why the want to exist the beekeeping part of the business.  No one suggesting they sell the Comvita brand. 

Edited by flash4cash
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1 minute ago, yesbut said:

Until everyone does it. 

I guess so ...hopefully tourist numbers quality friendly faces etc but why not clutch at straws....

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Nor do the customers care whether it is internally source manuka or brought off the market.  All the customers care about is the brand name Comvita.  The prestige and trust that goes with that brand. 

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1 hour ago, flash4cash said:

All the customers care about is the brand name Comvita.  The prestige and trust that goes with that brand. 

If only they knew huh?

That "prestige and trust" does not follow through to a lot of NZ beeks or I suspect shareholders these days!

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It's not all that often that Adam and I agree with each other. His main interest is marketing and mine is beekeeping.

The only real marketing I do is at the farmers market and while I really enjoy it there is no way I could sell all honey produced even off my meagre number of hives these days.I do make a profit at the farmers market but wouldn't do if I paid myself a wage.

When honey prices were high and stocks were low, supermarkets had to take what was offered and packers had to pay a good price to obtain stocks.Now supermarkets can get any amount of honey and prices are being screwed right down. Those packers that stuck with the local market are now being forced to drop prices which means  they are paying less for honey and with increased competition  they are also buying less honey. This leaves more honey to be dumped on the local market and the downward cycle continues.

Producer\packers have always been the backbone of New Zealand's honey industry and being beekeepers themselves they have to get a decent price to survive. Have a look round and you will find that the worst price cutters are solely packers and as long as they make their margins they are better off if they can buy honey cheap. This  cheap honey is being used to undercut  producer packers.

If the current trends continue we may look back on this year as the good old days.

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Packers are no different from beekeepers.  They want the best price for themselves. 

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1 hour ago, Ali said:

If only they knew huh?

That "prestige and trust" does not follow through to a lot of NZ beeks or I suspect shareholders these days!

?

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1 hour ago, Ali said:

 

That "prestige and trust" does not follow through to shareholders these days!

 

Never has.

3 hours ago, flash4cash said:

What we have going on right now is desperation.  [Agree]

Building a brand require significant financial investment and time. It takes years. [Agree]

 

I disagree that the supermarket is the most powerful player. Comvita has the best brand for Manuka.  If the supermarket does not stock it then they lose sales.  That why they can charge the most for the same product in a different jar. International customers want Comvita, not Bob's manuka. 

 

NZ needs one strong brand, probably Comvita.  That is it. We all invest and supply (and not over supply ) in that. 

 

"If the supermarket does not stock it then they lose sales." Well the NZ supermarkets don't stock Comvita, and yet PNS etc are doing fine. Meanwhile Comvita isn't. What does that say about who has the power?

 

Yes, some international customers want Comvita, not Bob's manuka, but there are plenty of others who want a lower priced brand of Manuka too. Those lower priced brands largely ride the coattails of the awareness and premium perception Comvita (and others, but Comvita more than any other) has created. 

3 hours ago, flash4cash said:

They can not make a profit in beekeeping owning hives.  They can make an awesome profit in brand sales of honey. 

 

They realise this which is why the want to exist the beekeeping part of the business.  No one suggesting they sell the Comvita brand. 

 

There are complimentary synergies and other benefits from vertical integration. E.g. they know and control all aspects of the honey's origin, production, quality, inputs and timing of supply.

To take one of these points that is seldom appreciated, timing of supply: it's pretty frustrating and inefficient to have a multi-million $ facility, and a whole bunch of staff employed who have little/nothing to do at times, and the flow on effects of out of stocks to the customers and export markets because independent suppliers supply according to their preferred schedules, not C's production requirements. And then there are other times when they have to work double shifts, pay overtime, need extra storage space etc.

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Do people think that if NZ honey market was not a protected market and had always had to compete with imports and the international price of honey the overstocking issue mighy never have happened .

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6 hours ago, frazzledfozzle said:

The high prices paid for Manuka honey is the cause of overstocking 

And all other honey types considered worthy of blending into Manuka. 20 bucks a kilo for Rewa,Kan,Dew.  A box of that returned as much as me slogging within orchards. Was ridiculous but any start up could make a load of cash fast to reinvest and expand. 

Edited by Gino de Graaf
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8 hours ago, frazzledfozzle said:

The high prices paid for Manuka honey is the cause of overstocking 

If NZ had opened its doors to imported honey in the 80s when pretty much all protection on local industry was removed do you think many beeks would have survived.

Except for those in pollination.

Lots of industries didnt survive the flood of imports .

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55 minutes ago, kaihoka said:

If NZ had opened its doors to imported honey in the 80s when pretty much all protection on local industry was removed do you think many beeks would have survived.

Except for those in pollination.

Lots of industries didnt survive the flood of imports .

In answer to your question, there would not be as many beekeepers and only the "true" beek would have survived.

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Back then, the price of honey in NZ wasn't much different to the rest of the world anyhow. Guys i worked for exported clover and other honeys with no issues competing on price. Import bans were (and still are) purely about biosecurity, not price protection.

 

Only since the manuka boom has there been a price divergence.

 

Reason people are suffering now is because most beekeepers now are post boom and know no different, used to having it easy not having to work a thousand hives a man plus do running repairs on clapped out vintage trucks to scratch a living, and many are over leveraged.

 

Combine that with the current over stocking and resultant small harvests, even seasoned beekeepers of non manuka will do it hard under the re normalised pricing regime.

 

There is another issue. Producers of manuka still have potential to make a decent living, and some of them will be making some non manuka as a bi product. They may be happy to dump it for whatever, just to get rid of it, their serious money is from manuka. That of course, would make it tough for people who only make non manuka.

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All I know @kaihoka was that pre Manuka we got sweet FA for our honey and most beekeepers were into pollination.

My dad built his business off the back of the kiwifruit boom.

when pollination was done the hives went into honey areas but the honey wasn’t harvested it was winter feed.

When I think of the major players in our area the vast majority have been in the industry since before the Manuka boom.

From memory Nelson Honey was the only player who was big enough to hire a lot of staff both full time and seasonal most of the others were smaller owner operated businesses who hired temporary staff to help with shifting hives in and out of pollination and helping with the honey harvest.

In the early stages of the boom it was only Manuka honey that was fetching higher prices and Manuka was identified by pollen analysis, taste, colour and how thixotropic it was. 
Non Manuka continued to be sold for low prices it wasn’t used for blending.
Those major players pretty much all increased the size of their businesses during the Manuka boom, increasing hive numbers, hiring more staff, upgrading vehicles and plant.

Before Manuka there weren’t a lot of honey buyers.

We sold to Airborne and Nelson Honey,  prices we got ranged from just over $2kg to just over $3 kg. 
The payment terms were generally by instalment over an 8 month period sometimes a payment was missed because they didn’t have the money and they would look after their big suppliers first.

 

The honey industry right now looks to be going back to the pre Manuka days so pressure is on all areas where there may be a sniff of Manuka honey.

 

Although even producing a crop of MPI standard Manuka honey doesn’t guarantee a sale.

 

long story short is no I don’t think imported honey back in the day would have sent many beekeepers to the wall 

 

Edited by frazzledfozzle
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17 hours ago, CraBee said:

 

That is before your standard MPI compliance, UMF licence, (SQF if you want to supply significant retailers) Halal, Kosher. Processing plant and equipment, finished goods stock holding. Weekly or even next day delivery bla, bla, etc etc

I was referring to this post.  An extraction and packing facility is actually not that costly, but it can be if you have deep pockets and want all the bells and whistles.  

Once you've got together the 50+ documents MPI want as part of your RMP, it is pretty simple.  The twice annual audits are the costly part.

SQF - No, not the market

Halal and Kosher - please....

Holding finished stock - warehouse space.

Delivery - well, come on, that is not hard.

 

Here is my question again:  If having a brand is so terrible, why did Midlands create one?

 

 

That is a good question. However the starting position for Midlands was different. Midlands were already a large scale packer of OEM private label product. They already had the facility and the bells and whistles in place before embarking on their own brand creation. Brands added security to an existing product mix. A gap in the market was identified before developing a brand to fill the gap. They had the IP within the team to execute a brand or brands with a long term strategy - years not months. 

16 hours ago, Rob's BP said:

 

Never has.

 

"If the supermarket does not stock it then they lose sales." Well the NZ supermarkets don't stock Comvita, and yet PNS etc are doing fine. Meanwhile Comvita isn't. What does that say about who has the power?

 

Yes, some international customers want Comvita, not Bob's manuka, but there are plenty of others who want a lower priced brand of Manuka too. Those lower priced brands largely ride the coattails of the awareness and premium perception Comvita (and others, but Comvita more than any other) has created. 

 

There are complimentary synergies and other benefits from vertical integration. E.g. they know and control all aspects of the honey's origin, production, quality, inputs and timing of supply.

To take one of these points that is seldom appreciated, timing of supply: it's pretty frustrating and inefficient to have a multi-million $ facility, and a whole bunch of staff employed who have little/nothing to do at times, and the flow on effects of out of stocks to the customers and export markets because independent suppliers supply according to their preferred schedules, not C's production requirements. And then there are other times when they have to work double shifts, pay overtime, need extra storage space etc.

In my opinion this is more complex. C are a class act that made some errors that only became obvious with hindsight. Large scale vertical integration is often a sensible move forward in many industries. The integration becomes harder the more diverse the skill sets between the integrated entities. 

Industrial large scale food manufacturing is a very different skill set to farming (bee keeping). Add a fickle crop such as Manuka and the issue increases. The security they had as a honey buyer came from many and multiple suppliers across many regions without the fixed cost associated with owning. As owners, they cannot achieve the same risk mitigation across supply/quality/cost. Their own crop will never supply all their own requirements and thus to greater or lesser extents they still must go to market to fulfil Honey requirements each season. At the same time, they have acquired the addition fixed costs of Bee keeping. 

As they acquire more hives they do not necessarily acquire or retain the IP at the same rate. In my opinion their average kg’s per hive will probably be less than a good Bee Keeping operation of 4-6,000 hives. 

By owning the hives, they also have a commitment to use all the honey, even the non- Manuka and grades or Multiflora that do not fit their product range. Of course, they can sell of the honey they do not require but only at market rate – if they can sell it?

 

In my opinion the Brand is a different story. Though very strong in China the brand has been hijacked by the Daigou channel, becoming a brand on continual discount and promotion. This makes it difficult for major domestic retailers to commit to. Once you brand has become synonymous with discounting you become pigeon hold. 

This can be compounded if your company name is the same as your brand, especially if you are a publically traded company. That said if there is a company in this industry capable of developing an additional brand or brands and having the means and distribution networks to support them to success it would be the Big C. 

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On 30/11/2019 at 1:35 PM, Nuc_man said:

So.... you have 50 ton in your shed no bulk buyers no future guarantee of sale new season crop coming on....guess what time to pack test your luck ...just maybe you might get your needed 7.5kg to survive or option 2 approach existing packers who offer 3.50 kg knowing full well its below production cost ...??? This is not going to work either way and small and big operators are measuring the string and planning there exit...with no sign or motion of a turn around what are the choices .....

 

A1962F4C-9D33-41DA-9F3A-DD86F68B6939.jpeg

This place is perfect for packing honey ..... even has some luxury accomadation when when you have to bail out of your Teepee.

Make a nice little base for the new Honey Co-op !

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7 hours ago, Bighands said:

In answer to your question, there would not be as many beekeepers and only the "true" beek would have survived.

whats a "true"beek

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2 hours ago, Dennis Crowley said:

whats a "true"beek

 a true beekeeper will still standing next spring?

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21 minutes ago, Nuc_man said:

 a true beekeeper will still standing next spring?

Nah, some will be last ones standing because they got finance. Not cause they any good, or True.

What makes a False beekeeper?

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37 minutes ago, Gino de Graaf said:

Nah, some will be last ones standing because they got finance. Not cause they any good, or True.

What makes a False beekeeper?

When the apple industry was in crisis a few yrs ago and trees were being pulled out the last men standing , who are doing well now ,  were the ones who held their never and built new infrastructure and expanded .

They were also ones who were so far in that there was no obvious road out .

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