“The Last Great Market for Mānuka” Opens, but India is Expected to be a Slow Burn
The New Zealand-India Free Trade Agreement (FTA) has officially begun, and tariff rates on certain mānuka honey exports have already been cut, with more reductions to take place over the next five years. Those who have been to India recently as part of the official delegations say they expect the mānuka honey market growth in the world’s most populous nation to be a slow-burn, and that would be a good thing for the long-term prospects of “the last great market for mānuka”.
The FTA entered into force on October 20, granting all New Zealand mānuka honey with a cost, insurance and freight (CIF) value of at least US$30/kg an immediate reduction from the previous 66% tariff to 56.1%. A ‘quota’ of 200 tonnes which gains the same tariff reduction – but must be applied for and granted by the Ministry from Primary industries (MPI) – has also been established for honey with a CIF value of US$20-$30/kg (as detailed in India Quota System Window Short, Sharp and Open Now).
The tariff relief available relates to both bulk and retail packed monofloral and multifloral mānuka honey, as certified by MPI. Only the CIF-value – effectively the value of the product landed in India – sets the grade which will get the helping hand to market.
New Zealand is the first country in the world to gain preferential access for honey to India. That will take the form of a 75% reduction over five years, with a second cut coming within months as the rate from January 1 2027 reduces to 46.2%, then 36.3% in 2028, and 26.4% a year later, before settling at 16.5% from 2030 on.
“It’s a massive opportunity,” says Nathan Guy, New Zealand’s special agricultural trade envoy, and until recently the chairperson of Apiculture New Zealand before its transition to Honey and Bees New Zealand.
“One-point-four-billion people, a growing middle class, and a bit of a sweet tooth which is great for honey. Any small gain in such a large market has the potential to be significant for honey exports.”
Many other products from New Zealand benefit from tariff reductions, with some smaller tariffs removed completely already, while others face similar longer-term, staged reductions and quota systems as honey. Conversely, all products from India now have completely tariff-free entry into the much smaller New Zealand market.
Slow Burn Expected
New Zealand is starting from a low base, with only five to six tonnes of mānuka honey exported to India in each of the last two years, the vast majority of it retail packed.
Since news of the FTA broke there has been “huge interest” in the India market from honey exporters according to UMF Honey Association (UMFHA) head of strategy and partnerships Campbell Naish. However, that doesn’t mean he believes there will be a significant rise in exports, at least in year one of the agreement.
“It is almost 20 years since the China FTA was signed,” Naish reflects.
“When you look at the way that market grew for us, in the first five years trade was pretty flat. Nothing changed in a hurry as everyone laid down platforms. Then, things started to grow rapidly to where things peaked just before Covid.”
So far the interest from New Zealand honey exporters has been in seeking to understand the new market better Naish says. That is a prudent approach according to Guy, who recently returned from a 10-day trip around the giant subcontinental nation.
“There’s an old saying, ‘10 years is a short time in India’. You have to keep turning up and turning up to build those relationships and do a lot of analysis on supply chains,” Guy says.
The Mānuka Collective is one such business undertaking that groundwork, with chief executive Sean Goodwin having made several trips to the emerging market in recent years, including crossing paths with Guy for a honey promotion in Mumbai in October. He believes the India market could be a 1000 tonne market for New Zealand in time (last year New Zealand exported 12,700 tonnes globally). Goodwin admits that is aspirational from a current six tonne base, but that with such a huge population, a growing middle-class, and an appreciation for natural health benefits, the recipe is there.
“The thing that struck me going back again recently is, all these wellness trends that we are seeing elsewhere, like protein demand, longevity, and preventive wellness, it’s all already there. That wasn’t the case 15 years ago when we tried to sell mānuka into countries where magnesium wasn’t even a known thing,” Goodwin says.
More Than a Billion Reasons to Take it Slow
Of course, the staged reduction in tariffs for mānuka honey will be the most obvious factor to limit potential market growth, but there are plenty of other reasons too, so say those who have seen the market up close.
“There are 28 states which all have their own rules, regulations and laws, so the ease of doing business requires a lot of due diligence. Finding customers will require finding the right partnerships based on values,” Guy says.
Logistically India and its 1.4billion people and huge, varying, geography will also take some learning. Mānuka honey’s susceptibility to reduced quality in high-temperature environments has the potential to throw challenges in both transit and storage.
“I would urge people to find the right partners,” Goodwin says.
“It’s going to be easy to jump at the first opportunity, but India can and will be a difficult market. They have some difficult standards in terms of getting things through their customs and food security people. You don’t want to be making mistakes. It is important that, as an industry, we turn up there properly.”
New Zealand Trade and Enterprise have increased their staffing in India due to the FTA, and are taking expressions of interest in attending the huge food and hospitality fair in New Delhi known as AAHAR in March 2027. UMFHA will have a presence there, and Naish recommends those considering exporting to India to join the New Zealand showing.
Get it Right
“Turing up there properly” as Goodwin puts it is not just about getting the product to the consumer in the best state possible, but also getting the right product in the first place, along with consistent marketing behind it, he says. It’s a plan, unsurprisingly, shared by UMFHA as they seek to distinguish honey carrying their quality market from that of others.
“This is the last great market for mānuka to target and try to build as higher-value market as possible,” Naish says.
“This is a real opportunity for New Zealand to make a planned entry into a market. The flaws in execution over the last 20 years have been everyone charging into market and competing with each other by confusing the story of what mānuka honey is.”
UMFHA have been consulting with experts already within the market and the advice given is to target the very top and that those people are not worried about price.
“The message is, target the top end, the top one percent, of the market to start with. On a population of one-point-four-billion-plus, that one percent is a huge market (14million-plus people). And be very focused. Look at starting right at the premium end of the market. There is absolutely no way anyone can target India, but they can target a small piece of India. We don’t have anyone in New Zealand with those capabilities and we don’t have enough honey,” Naish says.
Goodwin believes India is an opportunity for the mānuka honey industry to “reset the agenda” and “go in and do it properly”.
“The fact that the FTA is coming in on a relatively high grade of honey should help us as well. The story is about wellness and taking a product every day. We need to try and learn from some of the other markets where we haven’t done as well as we should have,” The Mānuka Collective chief executive says.
What does that look like in practice? For Goodwin it is a combination of “starting with the basics of what manuka is about, from a wellness point of view,”, and combing it with the full New Zealand story and Māori connection to mānuka. Then there is getting the grade of honey right.
“I think we need to show up at a consistent level, call that UMF10+, 250MGO, or whatever level that is, but that we are not going in and flogging MGO40 and the smell of mānuka based on ‘this thing is going to fix you’,” he says.
Centres of Excellence
A country the size of New Zealand does not get the wins in tariff reductions they have when negotiating with the world's most populous nation and sixth largest economy, without some give to the take. Included in the giving for beekeepers and honey sellers will be knowledge-sharing with their Indian counterparts through the ‘Honey Action Plan’ (HAP) which will result in two ‘Centres of Excellence for Honey’, in Uttar Pradesh in the north and the bustling Kolkata in India’s far east.
“The HAP is a collaborative effort between the New Zealand and Indian governments and industry, with strong progress being made towards its delivery,” says Nick Swallow, MPI’s divisional manager trade policy strategy and systems.
The centres aim to support the development of India’s apiculture sector through “technical collaboration, research, training and knowledge sharing”.
Both apple and kiwifruit industries will be undertaking similar agreements and critics have raised concerns at the risk associated with assisting a foreign agricultural sector that could undermine New Zealand.
“I don’t have any concerns about that,” Guy says, days after touching down in New Zealand from India.
“It means we will be helping them lift their productivity and to understand more about bee health and bee husbandry. Improving beekeeping practices, because they are not great. Some may say, ‘why on earth are we doing that?’, particularly with kiwifruit and apples. Firstly, it is part of the FTA and, secondly, if we can grow the overall category, then that is a win for them domestically and us as exporters.”
It’s a two-way street as well, Naish hopes, with the potential for greater research into mānuka honey.
“They are world class in their pharmaceutical studies. They have scope and they have government funding, and they are interested in collaboration. We will be looking to have discussions that help expand the amount of resources available to help us carry out research,” Naish says.
“There is opportunity for our industry to evolve through a partnership with a country like theirs, if we build up strong relationships.”
Opportunity Knocks
Those relationships shape to be wide and varied, from the research potential, to logistics and distribution partnerships, to marketing and education. With Australia working on adding honey tariff relief under their existing FTA with India, the time is now to build those relationships, even without the flow of honey.
“At the moment we are the only country in the world with an opportunity to export honey to India (with reduced tariffs), so this is our window to get it right,” Naish says, and that was the message he took from a FTA launch in Auckland where the Minister for Trade and Investment addressed exporters.
“Todd McClay’s message was, ‘we have opened the door, it’s up to you businesses to get it right’.”
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