Comvita says daigou trade will rebound
Border closures as a result of Covid19 have hindered the popular daigou honey trade, where international tourists, students and other private traders ship honey to China, but ma¯ nuka honey company Comvita is confident the market will recover.
In February, the country’s largest producer and marketer of honey and bee-related products said its New Zealand and Australian sales fell 21 per cent to $18 million in the six months to the end of December 2020 as the Covid-19 pandemic shut international borders and disrupted shipping, pushing up freight costs.
‘‘The main Asian health daigou channels have been impacted, in the first instance in Australia, and then subsequently in New Zealand, and that’s the impact that you are seeing in our numbers,’’ said Comvita chief executive David Banfield.
Daigou traders are an important sales channel, because they target different consumers than Comvita would otherwise reach, he said. Traders range from individuals who send a few products back to friends and family in China to companies which fulfil orders and have revenues ranging from tens of thousands of dollars to a couple of hundred million dollars.
‘‘At the most sophisticated end, you have got some very good operators who are providing a real scalable service, and at the ‘pickpack-and-post’ end you’ve got students, tourists and others who send product back to their extended network,’’ Banfield said.
Freight disruptions caused by the pandemic had seen some daigou customers in China buy locally instead through Comvita’s online and store network in China, he said. That helped boost Comvita sales in mainland China by 20 per cent to $35m in the six months to the end of December.
China is the world’s largest honey market, valued at $1.8 billion, and Comvita wants to grow its own market share and the imported honey share of the total market.
Banfield expects the daigou trade to rebound.
‘‘The daigou sector is very entrepreneurial in the way they approach things, they are innovative, so whilst they have had challenges over this period, they will find new ways for their business model to evolve so they can reach their user base in China.
Shares in Comvita slipped 1.8 per cent to $3.27 in early afternoon trading on the NZX yesterday. The shares have gained 11 per cent over the past year.