International Honey Market Update

(The following is brought to us by the American Bee Journal.) 2/20/13
By Ron Phipps President, CPNA International, Ltd. 
"The March to Monopoly Has Lost Its Momentum." 

There are several strategic issues facing the international honey industry. The first point I want to stress is the hopeful prospect that we are approaching the end of the two-tiered market that has plagued the industry for several years and created an unfair and uneven playing field for packers, importers and exporters. The circumvention of Chinese honey through a number of schemes such as transshipment through Indonesia, India, Malaysia, Thailand, South Korea, Taiwan, Russia and the Philippines, and the use of fraudulent customs categories, produced the two-tiered market. The 2012 termination of the exclusion of honey blends from the dumping case imposes a duty of 2.63/kg. on honey blends and closes another significant loophole in the existing anti-dumping order on Chinese honey. The march to monopoly has lost its momentum and a healthier era is on the horizon. Many packers are convinced that 2013 will see further and dramatic success in curtailing circumvention and legally punishing those who have conspired to circumvent Chinese honey in violation of U.S. law.

One consequence that we may see, as fraudulently entered honey declines in volume, is that US honey consumption may be far higher than current estimates indicate, since so much imported honey has entered the market either via transshipment or via non-honey customs classifications. Total National Honey Board assessments for imported and domestic honey are increasing each year, and 2012 declared imports were up 9% in volume over 2011. As of the end of December, the total value of imported honey for 2012 was $438 million, as reported in the Feb. 13, 2013 National Honey Report. (Table 1)

American beekeepers in the first months of 2013 have expressed growing alarm at the severe loss of bee colonies. Some beekeepers have reported losses of over 50% of their bee population. For the first time in a long time there seems to be enormous difficulty in getting an adequate number of bees to pollinate the almond groves in the California Central Valley. Despite the extremely high pollination fees, the decline of bee populations has not been reversed. Many beekeepers and apiary scientists attribute the bee decline to the reduction of pasturelands, open fields, and the encroachment by corn, soybean and canola crops on which powerful pesticides are being used.

Supply of Honey
We are witnessing a global shift in the supply of honey, especially white honey. Fifteen years ago it was typical for American beekeepers to produce 70-80 kilos per hive. In recent years, 20-25 kilos is usual and 35 kilos is regarded as a good extraction. This has affected not only supply of white honey, but has led to increased prices. As white honey from the US, Argentina and Canada, becomes both scarcer and more expensive, packers in the USA and Canada are shifting to blends that hover between white and ELA. This is a shift that will be hard to reverse. In this context, demand exceeds supply and prices are at historically high levels. Nonetheless, it would be foolish to presume there are no ceilings to honey prices, especially in the fragile and relatively stagnant economies of the western world and Japan, all suffering economic difficulties. Precisely because of the threats of continuing economic malaise and/or recession in Europe, Japan and the USA, there is a possibility of “currency wars” as nations are tempted to de-value their currencies, lower their prices and thereby, increase their exports. In the overall global context, nonetheless, demand for white honey exceeds supply and prices remain at historically high levels.
In the last few years...
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