Evaluating the financial feasibility of a Northland peanut industry
This report assesses the economic viability of establishing a peanut industry in Northland from the perspective of the potential customers, growers and processors.
This Northland Peanut Trial project builds upon and extends on the outcomes and findings of the “2020 Sustainable Farming Fund” funded project looking at the ‘Feasibility of growing hi-oleic peanuts in Northland’. That project was led by Picot Productions and delivered by Northland Inc in partnership with Plant & Food Research and Manaaki Whenua- Landcare Research.
PROJECT OVERVIEW
The project was run over three growing seasons and looks to test the commercial viability of growing hi-oleic peanuts in Taitokerau Northland, while building local understanding and identifying opportunities for future investment.
Year three (2023/24) of the trials will see six planting sites across Kaipara and the Far North, with an estimated 5 hectares of peanuts to be planted in October/November 2023.
To date the project has yielded promising results for the potential of a commercial peanut growing industry in Northland.
The project is led by Northland Inc with funding provided by Ministry for Primary Industries’ Sustainable Fibre Futures fund, Picot Productions, Northland Inc, and expertise from Plant & Food Research and Manaaki Whenua Landcare Research. The upcoming Year Three trials will involve three iwi partners.
SUMMARY OF PROJECT FINDINGS
Following the conclusion of Year 4 of the Northland Peanut Trials, Northland Inc commissioned Scarlatti to assess the economic viability of establishing a peanut industry in Northland from the perspective of potential customers, growers, and processors.
Each season of the Northland Peanut Trials presented both unique challenges and significant learnings around the potential of establishing a peanut industry in Northland. The report identifies that while significant challenges exist, there are opportunities around the establishment of a peanut industry in Northland, especially when considering value-added approaches.
The report findings are summarised below with a focus on these opportunities and the full report is available for download below this summary.
Potential for a Premium Local Product
A Northland peanut industry could create a unique, high-value product with strong local and national appeal. New Zealand-grown peanuts could command a premium price, especially if marketed as a sustainable, locally-produced alternative to imports.
Value-Added Opportunities
Vertical integration and product development could significantly improve the economic viability of a peanut industry in Northland:
- Branded Retail Products: Developing branded, retail-ready peanut products could capture more value along the supply chain.
- Specialty Varieties: Focus on growing specialty peanut varieties for niche markets could command higher prices.
- Peanut Oil Production: Extracting and marketing high-quality peanut oil as a gourmet product.
- Sustainable Packaging: Using innovative, eco-friendly packaging to differentiate the product.
Environmental and Social Benefits
Establishing a peanut industry could bring positive environmental and social impacts:
- Crop Rotation Benefits: Peanuts can improve soil health as part of crop rotations.
- Local Employment: Creating new jobs in agriculture and processing.
- Reduced Food Miles: Locally-grown peanuts would have a lower carbon footprint than imports.
Innovation Opportunities
The challenges identified present opportunities for innovation:
- Minimal processing for an inshell product
- Processing Technology: Developing more efficient small-scale processing methods could make local production more viable.
- Agronomic Research: Further research could improve yields and reduce production costs.
- Collaborative Models: Exploring cooperative structures or shared equipment models could reduce individual farmer costs.
Gradual Scale-Up Approach
Starting small and scaling up gradually could allow for learning and adaptation:
- 10 Hectare Scale: This could serve as a proof of concept, focusing on high-value snack products.
- 100 Hectare Scale: At this level, partnerships with established brands like Pic's could be explored.
- 1,000 Hectare Scale: This could potentially support a full-scale processing facility and diverse product range.
Where to from Here?
Continued Crop Trials: The Foundation for Arable Research (FAR) is set to conduct crop trials in Northland, with support from Northland Inc. These trials will include four crops, peanuts being one of them.
Expanded Partnerships: Three landowners, including two existing peanut trial partners, have been secured to participate in these new trials.
Development: Negotiations with a peanut producer have led to a commercial arrangement for purchasing crops from the growers. This marks a significant step towards industry establishment.
Industry Evolution: These developments signify the next phase in establishing a peanut industry in Northland. Growers will receive ongoing expertise and support while having the potential for financial returns, creating a more sustainable model for peanut cultivation in the region.
Long-Term Vision
While immediate economic challenges exist, a long-term vision for a sustainable, locally-produced peanut industry could align with broader trends towards food security and local production. With continued research, innovation, and strategic partnerships, the potential for a viable Northland peanut industry remains a possibility for the future.
PROJECT IMAGE GALLERY
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Water Trust Redhill site prior to planting.
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The team involved in planting.
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Peanuts being planted.
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Site planted and ready for growing.
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Peanuts growing prior to harvesting.
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Peanuts grow underground at the end of pegs from each flower.
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Threshing the peanuts involves digging them up and flipping so they can dry out.
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Harvesting the peanuts.
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Breeding a new generation of peanut farmers. Tyler Waters visits the site to watch the harvesting.
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Peanuts directly after the harvest.
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Mr Pic’s Peanut Butter joined us for the harvest.
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Peanuts drying before being delivered to Pics for processing.
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Peanuts after drying ready for delivery to Pics for processing.
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The Northland Inc team deliver peanuts to the Pic's Peanut Butter Factory.
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Peanuts going in to the oven for roasting.
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Peanuts being processed.
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Inside the Pics Peanut Butter Factory.
Project FUNDERS
SUPPORTING AGENCIES
PROJECT TEAM
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Greg Hall
Project Manager
I moved up from Auckland over 6 years ago to enjoy the sunny North and settled on a 4ha lifestyle block near Ruakākā. Find out more
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Jeanette Johnstone
Horticulture Specialist, Tuputupu Grow Northland
A Northlander born and bred, I have spent most of my life living in the North. Find out more
IN THE NEWS
Media releases about the project
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Northland Peanut Trials to Return in 2023
The Northland Peanut Trials are back on track, following a washout of the 2022 crops. Year three of the trials will see five planting sites across Kaipara and the Far North, with an estimated 5 hectares of peanuts to be planted in October/November. Read more
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It’s crunch time in Kiwi-grown peanut trial
Local peanut butter maker Pic Picot is hopeful that outcomes of the Kiwi peanut crop will bring him one step closer to a 100 per cent New Zealand-made nutty spread. Read more
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Northland Peanut Industry Dream One Step Closer
A recent Government-backed project proved that peanuts can be grown successfully in Northland. Now, additional government funding is making the next step towards commercialisation possible. Read more
MEDIA COVERAGE
Radio & news websites
STUFF: Peanut butter company adds Kiwi-grown nuts to the mix
A story appearing on the Stuff.co.nz website.
RNZ: Looking for the perfect peanut...
A Radio New Zealand interview on the peanut trials with Project Manager Greg Hall.
TV NEWS STORIES
Rural Delivery
A project update filmed at the beginning of the Peanut Trials in Northland which appeared as part of the TVNZ television series called Rural Delivery.
See other episodes of the programme