Lowveld Gold Macadamia (Pty) Ltd Business Plan › Section 4 › Industry Analysis: Macadamia Nuts

4.1 Global Production Landscape

South Africa is the world’s largest macadamia producer, with 2025 output estimated between 81,660 and 94,000 tonnes DNIS. The industry has grown at an average annual rate of approximately 9% since 2010 and production is expected to reach 180,000–190,000 tonnes within a decade. Other major producers include China (approximately 74,500 tonnes in 2025), Australia (approximately 56,890 tonnes), Kenya (approximately 47,500 tonnes) and the United States (approximately 15,500 tonnes).

Global Macadamia Production (2025 Estimates, Tonnes DNIS)

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4.2 Key Growing Regions in South Africa

Macadamias are primarily cultivated in three provinces: Mpumalanga, KwaZulu-Natal and Limpopo, which together offer the hot subtropical conditions ideal for production. Mpumalanga’s Lowveld region, centred around White River and Nelspruit (Mbombela), is the historic heartland of the industry and home to the world’s largest processing facilities. The region benefits from reliable rainfall (800–1,200mm per annum), fertile soils and established irrigation infrastructure.

4.3 Export Markets and Trade Dynamics

China is the dominant buyer of South African in-shell macadamias, accounting for 95% of in-shell exports and roughly 50% of total production in 2024. The United States has historically been the primary market for shelled kernel, accounting for 31% of shelled exports. Europe absorbs approximately 15% of exports, with the Middle East and other Asian markets growing. The trade policy environment has been turbulent, but early signals in 2026 indicate that both US and Chinese tariffs may be removed, which would significantly improve the competitive position of South African exporters.

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4.4 Pricing Environment

Industry leaders have reported that the 2026 whole-kernel price has risen 4.4% in USD terms to approximately US$14.10/kg, although halves-and-pieces pricing has declined by 8.7% due to oversupply of that grade. The widening spread between whole-kernel and halves-and-pieces pricing underscores the importance of cultivar selection and processing quality, both areas where Lowveld Gold will maintain a competitive advantage.

4.5 Industry Challenges and Risks

Despite the positive long-term outlook, the macadamia industry faces several challenges. Climate variability continues to affect yields, as evidenced by the 4% production decline in 2025 due to adverse weather. China’s expanding domestic production and cracking capacity may reduce reliance on South African imports over time. The price collapse of 2022 exposed the vulnerability of newer entrants who financed orchards with aggressive bank debt. These dynamics reinforce the importance of conservative financial structuring, diversified market exposure and a value-added product strategy.

4.6 Industry Outlook and Long-Term Fundamentals

The long-term fundamentals remain compelling. Global demand for healthy, premium tree nuts is growing at 8–10% per annum. South Africa’s processing capacity is expanding rapidly, with three major processors investing in additional facilities. Improved genetics, including high-yield cultivars such as MCT-1, promise 40–50% higher yields. Value-added products including macadamia oil, eco-briquettes from shells and confectionery ingredients offer diversification opportunities. The industry is transitioning from niche status to a major component of the global tree nut basket.

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