Going nuts for Aussie macadamias and almonds

Australia’s ‘tree nut’ industry is currently in a “period of growth” and could have many opportunities in the next few years to meet growing international demand, according to the latest Rabobank report, ‘Australian Tree Nut Outlook — opportunities and risks in almonds and macadamias’.

Opportunities could include meeting the growing appetite for tree nuts in export markets — particularly China — as well as developing innovative product offerings to increase local demand.

The report author, RaboResearch analyst Pia Piggott, said, “Positive consumption trends in tree nuts and more broadly in snacking will drive Chinese consumption growth over the next decade.

“And as China and India, another major tree nut market, have limited domestic production, we expect further growth in imports will be required to meet demand, which Australia’s growing production is well placed to provide,” Piggott said.

Other key tree nut export destinations — and important drivers of demand — include Vietnam, Spain and Turkey.

Growing markets for nuts

China remains the most critical market for both Australian almond and macadamia exports, the report says.

“China is a key market for Australian almonds,” Piggott said, “and an indefinite tariff on US almonds going into China makes Australian origin almonds less expensive than California almonds, which supports preference for the Australian product and a price premium.”

China remains the most favourable market for Australian macadamias, with over half (54%) of Australia’s total exports shipped to China in 2023, Piggott said.

Low per capita supply, rising health awareness, the rise of discounted snack stores and recovery in Chinese consumption support continued growth to China as the largest market for Australian almonds and macadamias, Piggott said.

New innovations for nuts

When it comes to the local Australian market, health and convenience trends haven’t been enough to grow domestic tree nut sales, Piggott said. However, as new product developments with tree nuts are presently limited in the domestic market, she sees innovation as an opportunity to increase local demand.

“Exports are the primary market for Australian tree nuts; however, the domestic market consumes 19% of almond supply and 22% of macadamia supply,” Piggott said.

“Australia has the highest per capita consumption rate of macadamias in the world at 0.15 kg/year. However, as a premium-priced tree nut, household penetration is low, with only 14% of households purchasing macadamias per year. Australia also has high almond per capita consumption, at 0.95 kg/year in 2023.”

Piggott said even with a comparatively lower price point, only 39% of households purchase almonds per year. “With supportive macro demand drivers including population growth and high disposable incomes there is plenty of room to boost domestic demand.” 

For Australian consumers, Piggott said tree nuts are most often consumed as a snack.

“With the qualities of being tasty, quick and easy to consume, and energising, the healthy nutritional profile makes tree nuts a go-to product, aligned with broader convenience and health trends.

“However, cost and more exciting alternatives such as cereal, chips and yoghurt remain barriers to consumption. Despite significant shifts in wholesale prices, asymmetric price transmission has limited consumers’ response in demand and as such supply to the domestic market has remained stable,” Piggott said. 

“In the US, the range of flavoured tree nuts rivals potato chips. Viral trends have caused Australian Internet searches for pistachio nuts to rise, but innovative offerings are missing at a local retail level. For tree nuts to compete against substitutes and grow demand, investment in product innovation is required. With many health claims, tree nuts are a go-to ingredient to appeal to consumers in the snacking category,” Piggott said.

Almonds and macadamias

The report said Australian almond exports have grown faster than the global average, at 9% compound annual growth rate (CAGR) over the past decade compared with global exports at 5%. Still, Australia currently accounts for only 9.5% of global almond exports, with 110,000 metric tons kernel weight (KWE) exported in 2023.

From 2024 to 2030, the Rabobank report says, industry forecasts Australian almond production to grow at a 4% CAGR, reaching 210,000 metric tonnes kernel weight equivalent by 2030.

For macadamias, Australia represents 25% of global trade, reaching 17,2000 t KWE in 2023. Macadamia production is expected to double by 2030​.

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