Hawaii is known for its macadamia nuts. Lawmakers want to keep it that way

HONOLULU– For decades, tourists to Hawaii have taken home gift boxes of the island’s famous chocolate-covered macadamia nuts for friends and family, but today many of the kernels in the package may not have originated in Hawaii.

This little-known fact is surfacing in the state legislature as lawmakers grapple with legislation that would force macadamia nut processors from iconic brands like Mauna Loa to disclose whether their products contain nuts from outside the islands.

Growers want the measure to protect their crops and farms, while commercial nut brands say Hawaii needs more capacity to process macnuts locally.

It’s the latest battle over labels for agricultural products from a specific geographic area, a topic familiar in Hawaii because of longstanding disputes over Kona coffee. It mirrors similar challenges faced by maple syrup producers in Vermont and distilleries in Champagne, which have had to fend off sparkling wine producers from other places to appropriate the French region’s name.

Foreign nuts are “cleverly marketed as Hawaiian,” said Jeffrey Clark, chief operating officer of a trust that owns Hamakua Macadamia Nut Company.

“It is not clear to consumers what is grown in Hawaii and what is grown abroad,” Clark told state lawmakers at a recent committee hearing. “It creates a problem for farmers here in Hawaii.”

The stakes are high for Hawaii’s more than 600 macadamia nut farmers, many of whom have small businesses. Combined, they produced $62.7 million worth of nuts in 2021, just above coffee in value and second only to seed farms researching genetically engineered corn.

Growers say they can’t find buyers for their nuts and unharvested nuts are falling from their trees. Some farmers give up and try to sell their equipment.

In response, state lawmakers will vote Wednesday on legislation that would require consumer packages to disclose when they contain macadamia nuts grown outside of Hawaii. The measure would come into effect on January 1, 2026, if it becomes law. The governor has not indicated whether he will sign it.

Macadamia nut trees are native to Australia and were introduced to Hawaii in 1881 by a Scotsman who managed a sugar mill on the Big Island. The first major attempt at commercial planting dates back to 1948. Chocolate-covered macadamia nuts took off in the following decade. In the 1970s and 1980s, Hawaii harvested more than ten times as much as the next four major producers combined.

But today, Australia, South Africa, China and Kenya are all growing more than Hawaii. The state’s output fell 29% in 2022 from the previous year, according to industry data.

Hawaiian Host Group sells macadamia nuts under some of the state’s most venerable brands. Their rectangular boxes of Macadamia nuts covered in Hawaiian Host chocolate are a favorite with tourists and locals alike. Their blue-colored Mauna Loa tins and bags are among the most recognizable macadamia products on store shelves.

The company’s chief executive told lawmakers at a Senate committee hearing that the amount of foreign macadamia nuts the company buys varies depending on the Hawaiian crop.

“We try to buy as many local macadamias as the growers want to sell to us,” says Michelle Leon-Guerrero.

CEO Ed Schultz told lawmakers that his company buys a third of the mac nuts grown in Hawaii. That will come at a 35% premium to Australian prices in 2023 and nuts from Hawaii should be competitive with those from Down Under, he said.

He said the industry needs more processing capacity. To that end, Hawaiian Host wants the industry to form a cooperative to run a new processing facility on the Big Island. Many growers are hesitant to participate in such a project without a labeling requirement that will distinguish their nuts from others around the world.

Nathan Trump, president of the Hawaii Macadamia Nut Association, said Hawaii macadamia nuts have strong brand recognition. But he said the status quo is commodifying the nuts.

“When you look at things like maple syrup from Vermont and beef from New Zealand, different countries of origin matter because quality matters to the consumer,” he said. “If they understand the country of origin, I think they can make the decision whether they want to pay a higher price.”

Vermont law says that no maple product may be labeled as coming from Vermont, or labeled in a manner that implies so, unless it is 100% produced in Vermont in accordance with state standards.

In Europe, champagne makers came together in the 19th century to prevent sparkling wine producers operating elsewhere from using the name of the French region for their drink. Today, European Union rules allow products to be given a geographical indication if they have a specific link to the place where the product was made.

State Rep. Kristin Kahaloa’s Big Island district is located on the western slopes of Mauna Loa, the volcano that is the namesake of the popular nut brand. She said smaller farmers and producers want both labeling requirements and more processing capacity, and she agrees.

“Mauna Loa is the name of our mountain,” Kahaloa said. “It’s about preserving a special agricultural product that is part of the fabric of our community on our island.”