No More Macadamia Nuts
26 August 2007
In addition to coffee we also have about five acres of macadamia nut
trees. There was a time when Hawaiian macadamia nuts sold for
more money than Kona coffee but things have changed and that time may
be gone forever. Competition from overseas is a primary reason
but there are also major issues with labor, marketing and corporate
politics. So it's looking like the Hawaii macadamia nut industry
will soon go the way of the Hawaii sugar cane industry and may never
recover.
A couple years ago prices were down but we still managed to sell our
macadamia nuts to one of the mills. Last year that mill stopped
accepting mac nuts from farmers and none of the other mills were
accepting new accounts. This year the prices are even lower and
even fewer mills are accepting nuts. The time required to
maintain and pick our macadamia nut orchard just isn't justified so we
have all but abandoned our trees.
Several other farmers in the area have already taken out their
macadamia nut trees and replaced them with coffee. They usually
use bulldozers or giant Fecon machines. Neither method is cheap
and removing the trees is just the beginning, preparing the ground and
planting coffee is another giant expense. Once planted, coffee
takes at least three years before it starts to produce anything to pay
back all those expenses. If the macadamia nut market recovers and
we wanted to replant with macadamia trees, it takes over twelve years
before they start producing. With all the time and expense
involved, I want to make sure I don't make any hasty decisions.
We planted another field with coffee this year. All that's left
now are a few empty spots here and there around the farm. We'll
probably plant those next spring, leaving the macadamia nut orchard for
yet another year. If we're lucky and Hawaii's macadamia nut
industry recovers then we'll be in good shape but that's not looking
very likely.
Another farmer and I have been discussing the possibility of purchasing
our own macadamia nut processing equipment. We both process our
own coffee so we can leverage off our existing equipment. It
would cost a few thousand dollars to get started. The idea is to
process the macadamia nuts for all those farmers rejected by the large
mills. We would process the nuts but not buy them, finding a market
for the processed nuts would be up to the individual farmers. It sounds
like a decent plan but it's not a sure thing. I can barely keep
up with our coffee so dealing with macadamia nuts at the same time
might be overwhelming. I'm also not convinced that the costs will stop
at a few thousand dollars. And there's certainly no guarantee that
there will continue to be a demand for macadamia processing. The
big mills aren't stupid, if they're getting out of the industry then it
may not be a good idea for a couple of little guys to jump into the
industry. There's just no way to know for sure.
Things change, those that can adapt will survive, those that can't will
perish. It's called survival of the fittest. If another
country or another farmer has figured out how to sell macadamia nuts
better or cheaper than I can, then they will get the business.
From another perspective, it makes sense to buy macadamia nuts from
whomever offers the best product at the lowest prices. So I don't
hold a grudge against anyone just because the world happened to change
in a way that doesn't favor me. Instead I will do my best to
adapt and find something I can do better.
We have sold our last bag of macadamia nuts for now. If the market
recovers we may sell macadamia nuts again. In the mean time we
will concentrate on our coffee. Our coffee sales continue to
grow. This year's coffee harvest is looking promising and there are
still plenty of people that crave their daily fix of Kona coffee.
While trying to sell this year's avocado crop I asked one of the local
produce wholesalers what crop he has the highest demand for.
Without hesitation he said limes. Apparently the resorts on the
island can't get enough limes. I don't know how well lime trees
will do on our farm but we do have a lemon tree and it produces more
lemons than you can shake a stick at. Maybe I'll plant some lime
trees and see how they do.
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