Honey Industry Profile
The best known primary products of beekeeping are honey and wax, but pollen, propolis, royal jelly, venom and queen bees are also marketable primary bee products. This profile deals with honey, wax and royal jelly, given their popularity.
Honey can be used for a variety of purposes, including:
Ingredient in medicinal products
In places with considerable temperature fluctuations, honey is a well-known remedy for colds and mouth, throat and bronchial irritations and infections.
Honey is used in moisturizing and nourishing cosmetic creams, but also in pharmaceutical preparations applied directly on open wounds, sores, bed sores, ulcers, varicose ulcers and burns.
The tobacco industry uses honey to improve and preserve tobacco's aroma and humidity.
It is important to note that pollen will vary according to the plant species from which it is gathered and no one pollen type can contain all the characteristics ascribed to "pollen" in general.
Uses of pollen include:
Though in many cases beeswax can be replaced with cheaper, synthetic waxes, it has very special characteristics, medicinal benefits, plasticity and aroma which ensure its continued use. Many of these characteristics cannot be achieved with artificial waxes. The trend for more natural products in cosmetics may also increase its use. There are many types of synthetic waxes available today, often with superior characteristics for special applications. Apart from price and availability, beeswax has preferred characteristics in a wide range of applications. There are very few products which consist of only beeswax or in which only beeswax can be used, but the value or characteristics of most other products are enhanced or complemented by its inclusion.
Uses of wax include:
Cosmetics and pharmaceutical industries
Royal jelly is secreted by the hypo pharyngeal gland (sometimes called the brood food gland) of young worker (nurse) bees, to feed young larvae and the adult queen bee. Royal jelly is always fed directly to the queen or the larvae as it is secreted; it is not stored. This is why it has not been a traditional beekeeping product. The only situation in which harvesting becomes feasible is during queen rearing, when the larvae destined to become queen bees are supplied with an over-abundance of royal jelly. The queen larvae cannot consume the food as fast as it is provided and royal jelly accumulates in the queen cells. The exact definition of commercially available royal jelly is therefore related to the method of production: it is the food intended for queen bee larvae.
Royal jelly can be sold in its fresh state, unprocessed except for being frozen or cooled, mixed with other products, or freeze-dried for further use in other preparations.
The fresh production and sale can be handled by enterprises of all sizes since no special technology is required.
In its unprocessed form it can also be included directly in many food and dietary supplements, as well as medicine-like products or cosmetics. For larger industrial scale use, royal jelly is preferred in its freeze-dried form because of easier handling and storing.
Since the assumed benefits of royal jelly have not been sufficiently proven, statements made in advertisements and on package labels should avoid suggestions which are not well-founded.
A large amount of royal jelly is sold and consumed as it is harvested.
Royal jelly is used in:
Source: Food and Agriculture Organization of the United Nations, Rome 1996
Source: Food and Agriculture Organization of the United Nations, Rome 1996
Even though many potential markets exist for honey and its by-products, many of the markets listed above have substitute products that are more cost-effective than honey. The primary markets for honey continue to be in the retail, foodservice and industrial markets.
Honey producers have four alternatives to market their honey.
THE CANADIAN HONEY INDUSTRY
Approximately 80 per cent of Canadian honey production is concentrated in the three prairie provinces of Saskatchewan, Alberta and Manitoba.
Some of Canada's top players in the commercial honey industry include:
Bee Maid (http://www.beemaid.com/): Bee Maid is Canada's largest marketer of consumer packaged honey, with distribution centres around the world. Honey for Bee Maid is produced by beekeepers in the western prairies and is processed and packaged at their facilities in Spruce Grove, Alberta and Winnipeg, Manitoba.
Billy Bee Honey (http://www.billybee.com/): Billy Bee Honey is based in Toronto, Ontario and is Canada's largest private honey packer. Their state-of-the-art plant has an annual capacity of 25 million pounds, and their sophisticated technology allows them to maintain their competitive advantage in the ever changing world market. They are also one of Canada's largest exporters of bulk and packaged pure Canadian honey. Billy Bee honey is delivered to over 30 countries including the United States, Germany, France, Japan, Mexico and Hong Kong.
Capilano Labonté, Victoriaville, Quebec (http://www.labontehoney.com/): Effective July 1, 2003, Capilano Honey Limited (of Australia) and Miel Labonté Honey Inc. commenced working together to service the North American honey market, under the name Capilano Labonté. Prior to their partnership, Miel Labonté had been producing and distributing honey throughout Quebec, the Maritimes and Ontario for the past 66 years. The company is the largest honey packer in Quebec, holding approximately 55 per cent of the honey market in the province. The company's supply chain includes over 200 Canadian beekeepers.
The company has a diverse product line which includes: liquid honey, creamed honey, honey jelly, honeycombs, candies and cough drops, royal jelly, pollen, honey mustard, honey BBQ sauce, beeswax and maple syrup. With 35 employees, the company is also a major supplier of maple syrup to the Canadian retail industry.
Odem International Inc., Rosemere, Quebec (http://www.odeminternational.com/): The company is a trading house specializing in exporting bulk raw honey and beehive products (e.g. beeswax and bee pollen) from Canada to the United States in full container loads. They also have an established reputation in Europe and Japan as suppliers of specialty honeys including Water White Clover, Raspberry, Sage, Mint, Buckwheat, Blueberry, Tupelo, Orange Blossom, Gallberry, Star Thistle, Basswood, Honeydew and Palmetto.
Their annual volume of honey is about 10,000 metric tonnes (mt.). In Canada they buy directly from commercial beekeepers, while in Asia and South America they contract with specialized trading houses or co-operatives. They sell directly to honey packers in the United States, Western Europe and Japan. They move raw honey in full ocean container loads of about 20 mt. each. The honey is packed in 300 kg steel drums. Crude beeswax is traded by lots of 10 tons minimum. They buy from their suppliers of honey and sell to wax refiners in Europe and the United States. The beeswax must be in blocks, shrink wrapped on pallets or packed in boxes or bags.
Odem distributes bulk bee pollen and royal jelly in Canada and the United States. Bee pollen is packed in 50 pound boxes. They offer different origins including the bee pollen from the western provinces, Spain and China. Royal jelly comes from China and is fresh frozen, packed in one kilogram jars.
Golden Acres Honey, Threehills, Alberta (http://www.goldenacreshoney.com/): Golden Acres Honey is a packer and seller of Canadian honey. The company is also kosher and organically certified. They supply many major retailers in Canada as well as the private label market. They ship by the pallet, pail, barrel, or tote in order to be able to service not only retail but industrial requirements. The majority of their business is in wholesale.
In 2002, Agriculture and Agri-Food Canada reported that Canada was the ninth largest honey producer in the world, with about three per cent of the world production.
(Source: USDA, Foreign Agricultural Service GAIN Report, "Canada Honey Production and Trade Update 2002".)
Opportunities and Constraints
Opportunities and constraints on industry growth include:
(Source: http://www.agr.gc.ca/, "2001/2002 Canadian Honey Situation and Trends".)
The U.S. Honey Industry
The United States Department of Agriculture has estimated that there are between 139,600 and 212,000 beekeepers in the United States. The vast majority (95 per cent) are hobbyists with less than 25 hives.
There are about 1,600 commercial beekeeping operations in the United States (those with 300 or more colonies), which produce about 60 per cent of the nation's honey.
In 2006, over 154 million pounds of honey were produced in the United States, with a value of $161 million. The average annual yield per colony was 64.7 pounds.
U.S. Honey Market in pounds (2006)
(Source: National Honey Board, http://www.nhb.org/)
Although the long term (20 year) average honey production is 201.6 million pounds, since 2001, honey production has declined significantly to a record low of 154.8 million pounds in 2006. The decrease in domestic production is attributed to colony losses and reduced production related to mite and other disease control problems. Widespread drought in 2006 also contributed to the decline in honey production.
The United States consumption is nearly 350 million pounds. (Source: Agricultural Marketing Resource Centre, Iowa State University, June 2003.)
Major imports of honey to the United States are from Argentina, Canada, China, and Mexico.
U.S. Imports 2006 (pounds)
(Source: National Honey Board. "Other" includes all countries except China, Argentina, Canada and Mexico.)
Top Honey Production States, 2006
(Source: USDA, National Agricultural Statistic Services.)
The top six honey producing states represent nearly 60 per cent of the total United States production.
The United States honey industry is easily accessible; entry and exit from the industry is done with relative ease.
There are approximately a dozen large commercial honey packers that process over 50 per cent of the domestically prepared commercial honey. The balance of the domestic production is processed, packaged, and sold by smaller firms or individual beekeepers. Since many of the top packers have been in business for a very long time (20 - 40 years), their processing facilities in many cases are not located close to production or to large population centres. History dictates the location of the plant. However, it was suggested that transportation costs tend to average out in the long run. (Source: Agricultural Marketing Resource Centre, Iowa State University, "Apiary Industry Profile", June 2003.)
This industry was described as being "competitive" especially in the retail and ingredient market segments, since "honey" sales make up a small component of each of the respective markets. In addition, the profit margins are not very high, which is indicative of the fact that large multinationals have not pursued the purchase of a honey packer/processor.
The players in the industry include producers, packers, trading houses/ importers and queen bee and package bee producers:
Sioux Honey Association, Sioux City, Iowa (http://www.suebeehoney.com/): Sioux Honey Association is the leading packing co-operative. Membership had grown over the years to a peak of 1,200, but currently includes about 375 members as apiaries have grown, consolidated and modernized.
Membership hails from the western two-thirds of the United States, plus Florida and Georgia.
Liquid honey is shipped by its members to their processing plants in 55 gallon (U.S.) drums, containing approximately 650 pounds of honey. Collectively, the membership produces around 40 million pounds of honey annually.
Sioux Honey markets their products globally under the labels: Sue Bee, Clover Maid, Aunt Sue, and Natural Pure North American brands.
Plants are located in Waycross, Georgia; Sioux City, Iowa; and Anaheim, California.
Sioux Honey is a world wide marketing organization. Its global presence extends to the Middle East, Far East, South and Central America. Exports make up about 10 per cent of the company's business.
Dutch Gold Honey, Lancaster, Pennsylvania (http://www.dutchgoldhoney.com/): As the largest independent honey producer in the United States, the company processes in excess of 50 million pounds of honey each year, distributing it to some of the biggest names in the food and grocery industries. The company services retail, foodservice and bulk customers with an on-site retail outlet offering 13 different varieties of honey.
The company has four business divisions in two states (Pennsylvania and New Hampshire) - the original honey packing operation (which is located in a 100,000 sq. foot plant), a maple syrup processor and two specialized foodservice container distributors.
Raw honey is purchased from beekeepers domestically and around the world and processed by Dutch Gold. Dutch Gold typically purchases honey by the truckload. Each truck is loaded with 55 gallon (U.S.) drums, weighing 650 pounds apiece. The company supplies honey in consumer-sized packaging, five gallon pails, 55 gallon (U.S.) drums, stainless steel totes, plastic totes and tank trucks. The company sells only within the United States and all honey is certified kosher.
Dutch Gold distributes their honey anywhere east of the Mississippi, via their own fleet of 12 vehicles and through outside freight carriers.
Golden Heritage Foods, Hillsboro, Kansas (http://www.ghfllc.com/index.html):
The Packer Tracking Study conducted by Research Dimensions looks at the very large bulk ingredient, retail and foodservice markets. The study is based upon actual pound sales (domestic and international) reported by approximately 14 packers representing about 56 per cent of the estimated honey market. According to the study, honey went into three main market segments (see chart) between 1997 and 2000. This was confirmed by one of the leading packing companies in the United States.
Companies outside of the food industry (e.g. cosmetic or nutritional) commonly will purchase the honey they need for their products through a packer, rather than dealing directly with a producer group.
(Source: National Honey Board, Honey Industry Facts, March 2002.)
The International Market
According to the Food and Agriculture Organization of the United Nations, the top consumers of honey in 2002 were the United States, China, Germany, Russia, Ukraine, Turkey and India. Increased consumption can be attributed to the general increase in living standards and higher interest in natural and health products.
The international market usually trades honey in 300 kilogram metal drums, and only a very small percentage of the market is traded in retail containers.
The quality of the honey in general determines the price class, for example, table grade (United States grade A) or industrial grade (United States grade C or D). Such parameters as moisture content, cleanliness, off-flavours, and homogeneity (e.g. uniformity in composition and structure) are major considerations.
The current rise in health-consciousness, the new science indicating food's protective elements (e.g. nutraceuticals), and the number of industries looking for more natural-health promoting, healing or nostalgic ingredients are opportunities which are capable of positively impacting the demand for honey.
It is important to note that the industry is evolving primarily through consolidation, which is similar to what is happening in the retail industry. Few "new players/processors" are emerging in this very competitive environment. Existing players are growing and expanding their market presence by acquiring or partnering with other businesses.
The future of the Saskatchewan honey industry will depend on the province's ability to:
For more information, contact:
Provincial Specialist, Apiculture