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Non-Tech : ML Macadamia Orchards, L.P.
NUT 0.010000.0%Sep 25 4:00 PM EDT

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To: long-gone who wrote (7)6/5/2002 3:48:58 PM
From: long-gone   of 13
October 14, 1998
News Release 98-077
Inv. No. 332-386
World production of macadamia nuts has risen 67 percent since 1992, reaching a record output of 72,914 metric tons in 1997, reports the U.S. International Trade Commission (ITC) in its publication Macadamia Nuts: Economic and Competitive Conditions Affecting the U.S. Industry.
The United States was the world's largest macadamia nut producer from 1992-1996, according to the report. However, in 1997, Australia replaced the United States as the world's leading producer.

The ITC, an independent, nonpartisan, factfinding federal agency, recently completed the report for the U.S. Senate Committee on Finance. As requested, the ITC reported on the competitive factors affecting the U.S. macadamia industry, including competition from Australia, Kenya, South Africa, Malawi, Guatemala, Costa Rica, and Brazil, as well as trade practices and barriers of the competing countries that impede U.S. macadamia nut exports. Following are highlights of the report.

The United States was the world's largest consumer of macadamia nuts during 1992-97, the period covered by the report, and accounted for 51 percent of world macadamia consumption in 1996-97. Japan was the second largest consuming country, accounting for 15 percent of world consumption, and Australia was the third largest, accounting for 13 percent of world consumption.

U.S. macadamia nut production reached an all-time high of 26,309 metric tons in crop-year 1997/98, up 21 percent from crop-year 1992/93. Production in crop-year 1998/99 will most likely be below 1997/98 levels because of drought in Hawaii.

Australia's macadamia nut production also reached a peak of 27,500 metric tons in 1997/98, up 129 percent from crop-year 1992/93. Australian production in crop-year 1998/99 is also expected to be below 1997/98 output because of weather-related problems.

Globally, the area planted to macadamia trees has expanded since crop-year 1992/93. Although the U.S. planted area has remained almost unchanged, the area planted in key producing regions such as Australia, Guatemala, Kenya, and South Africa has increased 50 percent since 1992. As these newly planted trees mature, world supplies of macadamia kernels will likely increase.

World macadamia supplies currently exceed demand and are depressing prices. Farm prices reported by the Hawaiian Agricultural Statistical Service fell by 5 percent from $1.72 per kilogram in 1996 to $1.65 per kilogram in 1997.

Asian macroeconomic troubles are contributing to lower macadamia nut prices in 1998. Asian tourism to Hawaii and Australia, a principal source of demand for macadamia nut products, declined in 1997 and early 1998, following two years of strong growth. Import demand for U.S. and Australian macadamia products in Asia is declining as well.

Since the price declines in the early 1990s, the U.S. and Australian industries have employed different marketing approaches. Australian exporters have launched a generic campaign to boost demand for macadamia nut products in export markets in Asia, Europe, and North America. In contrast, U.S. firms have focused on promoting products under their respective brand names or as "Hawaiian" products. U.S. and Australian interests disagree over the relative benefits of these different approaches as mechanisms for allocating current and expected increases in worldwide supply of macadamias.

Based on breakeven nut-in-shell prices, the relative costs of growing macadamias are generally higher in the United States than in Australia. In the United States, the break-even price ranged from $1.21 to $2.03 per kilogram, compared with $0.58 to $1.28 per kilogram in Australia.
Macadamia Nuts: Economic and Competitive Conditions Affecting the U.S. Industry (Inv. No. 332-386, USITC Publication 3129, September 1998) will be available on the ITC's Internet server at A printed copy may be requested by calling 202-205-1809 or by writing the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW, Washington, DC 20436. Requests may be faxed to 202-205-2104.

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