Honey, I shrunk the margin

Customer willingness to pay a premium for the natural health qualities of honey appears to be outweighing price hikes for the natural sweetener amid falling production levels as beekeepers have battled catastrophic colony losses.

This has reduced worldwide bee numbers, prompting fears that confectioners might adapt production methods to replace honey with other naturally occurring sweeteners, such as stevia.

But these bee deaths have coincided with a surge in publicity about the benefits of honey, particularly compared with sugar as governments battle to reduce consumer intake of refined food products.

As a result, honey consumption has held steady and in some cases, enhanced its place in food production as customers have looked for the sweetener on ingredient labels. Indeed, more than 10,000 new products using honey as a sweetener were launched in 2015 alone.

Figures released by research company Euromonitor International show that since 2011, world honey production and consumption has been increasing steadily.

In 2011, 1.61 million tonnes were produced, in 2012 that figure rose 2.7 per cent to 1.65m, a further 2.6 per cent increase took production to 1.69m tonnes in 2013, the 2014 figure reached 1.73m tonnes, by 2015 it was 1.76m and production levels of 1.8m tonnes for 2016 are the latest available statistics.

Over the same period, their figures show the retail value of the honey market has risen from $6.6m to $7.6m.

Quality concerns 

But there are ongoing concerns about quality, with manufacturers and beekeepers cutting corners to replace honey made naturally from flower pollen. Such ‘adulterated honey’ or ‘honey laundering’ practices – where honey is wrongly labelled as being sourced from a particular area or where rogue beekeepers have fed their bees sugar water, corn syrup or other stimulants to boost production – have expanded the quantity of honey supplies, even if the quality has fallen and declared provenance is unreliable.

Dr Noah Wilson-Rich, founder and chief scientific officer of The Best Bees Company in the US, explains, “They don’t rely on flowers, they ramp up production to meet demand and do it at low cost by feeding bees artificial food.

“A large truck with a hose sprays the mixture into buckets on farms. Others give food supplements to the bees which makes them hungry. This makes them make more honey so they can sell it cheaper to consumers. It’s very widespread in the industry.”

In the longer term, however, such practices could be risky. “Bees are more susceptible to pesticides if they’re fed supplements,” adds Wilson-Rich.

Honey bees have been experiencing higher winter – and summer in some case – losses globally since 2006 when colony collapse disorder (CCD) was first identified as a virus killing off millions of bees worldwide. In past years, an expected colony loss rate per winter was about 15-17 per cent; but since 2006, in the US, the rate of loss has been between 25-45 per cent, according to a spokesman for the Pollinator Partnership, a nonprofit organisation that supports honey bees and other pollinators in terms of research, habitat creation and policy.

Bee numbers have also suffered due to pesticide use and climate change adversely affecting natural habitats.

This year’s Assessment Report on Pollinators, Pollination and Food Production by the UN’s Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services says, “The western honey bee is the most widespread managed pollinator in the world, and globally there are about 81m hives producing an estimated 1.6m tonnes of honey annually.”

Latest figures from the European Commission suggest the European Union is home to 16m hives producing 234,000 tonnes of honey a year.

Rising prices 

But with hive numbers falling, prices are rising: the US National Honey Board, which produces monthly data on honey prices, notes that the average wholesale case price per pound doubled from $2.57 in April 2006 to a record $5.46 in June this year. Maybe unsurprisingly, given the adoption of new production methods, prices for industrial honey have not been rising consistently. They are lower than for table honey and the global market generally follows the lead of the world’s biggest producer in this sector, China.

In Europe, the average import prices for Chinese honey fluctuated between 2010 and 2014, from €1.28 to €1.53 per kg, according to EU statistical agency Eurostat.

“The popularity of industrial honey has been increasing recently, due to honey’s perceived healthy features compared to sugar and other sweeteners,” explains the CBI, the Centre for the Promotion of Imports from developing countries, which is part of the Netherlands Enterprise Agency funded by the country’s ministry of foreign affairs.

It says Europe is the second biggest global producer of honey, but still relies on 40 per cent imports to feed the consumption habits – 339,000 tonnes in 2015. Romania, Spain and Germany are the biggest EU producers.

Germany, UK, France, Belgium and Spain are the biggest importers with 29 per cent of their honey coming from China for domestic use or resale.

That said, between 2011 and 2015, European honey exports increased substantially (8.5 per cent annually), amounting to more than 162,000 tonnes in 2015, the CBI says, although a significant proportion of this trade was intra-European.

The main destinations for European honey exports are other mature European markets, mainly in western Europe. More specifically, the most important export destination for 2015 was Germany, absorbing 18 per cent of the total European honey exports.

Professor Norberto García, president of the Association of Honey Exporting Countries, notes, “Pure honey has become a scarcer and difficult to produce food.

“However, during the last few years the name ‘honey’ has been increasingly associated with nature and health. That is one of the reasons many confectionery manufacturers want to include honey in their products. Normally honey is only a small portion of the final product.

“It is hard to know if an eventual increase of honey prices has a real economic impact on the costs of the final product compared to the benefit of using the word ‘honey’. Or, if that is only an excuse for some manufacturers that want to reduce costs using alternative sweeteners in their products while still showing the word ‘honey’.”

Alternative sweeteners 

The CBI predicted the cost of alternative natural sweetener, stevia, would fall in the short term and according to Innova Market Insights, one per cent of confectionery products launched in 2014 contained the ingredient, only licensed for use in the EU in 2011.

“The confectionery industry has been perhaps slower to take on stevia sweeteners than originally forecast,” Innova’s director of innovation Lu Ann Williams says, adding, “and it remains to be seen how take-up will develop over the next few years.”

Stevia is still used alongside other sweeteners, such as honey or sugar, as it has a bitter “strange taste”.

Agave syrup and coconut sugar have also been used in a limited capacity, but are becoming increasingly popular. US-based food manufacturer Cargill has launched Truvia Nectar, a reduced calorie liquid tabletop sweetener combining honey, stevia and sugar, but has yet to receive orders for industrial use.

Brain Nau, global Truvia brand leader for Cargill, says sugar blends the other two ingredients, adding, “If it were just honey and stevia, you wouldn’t get the same overall taste quality and mouthfeel.”

In 2015, honey was named ‘Flavour of the Year’ by Firmenich, the world’s second largest supplier of flavours.

“Product developers are realising what a fantastic and versatile flavour honey is…combining it with other tonalities,” notes Patrick Salord, senior flavourist at Firmenich.

To combine this popularity, the nod to healthy alternatives to sugar plus the plight of bees, New England manufacturer, Harbor Sweets, has just introduced a new Gather Chocolate range of honey flavoured chocolate. The chocolatier has vowed to donate 2.5 per cent of all Gather sales to the Pollinator Partnership to preserve pollinators, including honey bees.

US-based flavour experts Fona International says 10,311 products using honey as a sweetener were launched globally in 2015, including 1,695 in North America, such as Bonté’s Honey & Cranberry Flavoured Lozenges, Ambrosial Harvest’s Authentic Mediterranean Basil Honey Almond Ancient Grains Clusters, as well as Droga Chocolates’s Money on Honey Wildflower Honey Caramels in Dark Chocolate Sprinkled with Fleur de Sel.

A 2015 co-ordinated control plan, carried out by the European Commission’s Joint Research Centre, to establish the prevalence of fraud in honey marketing, found 14 per cent of samples from across the EU, Norway and Switzerland contained added sugars. Its report called for the creation of a central database of authentic honeys and substances which can legitimately be added “to increase its volume or bulk.”

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