As the mānuka honey price pinch tightens, 26 now former Unique Mānuka Factor Honey Association (UMFHA) licence holders have had their ability to use the UMF brand revoked, while the Association has upped its budget for testing honey in market, in an attempt to clamp down on non-compliant honey.
“In the last six months we have reviewed the quality of our membership and terminated 26 license (sic) holders we identified as detracting from UMFHA standards either due to quality, compliance or financial reasons,” CEO Tony Wright stated in his annual report in May.
For the majority, it was the latter “financial” reasons that led to expulsion from the Association.
Around 130 UMF licensees remain, equating the terminations to between 15 and 20% of the total licence holders from six months prior.
“For various reasons some of our licence holders find their circumstances change and they struggle to pay their bills,” Wright explained when further questioned on the matter.
“While we have sympathy for their plight, we cannot support a situation where they continue to enjoy the benefits of using the UMF mark, but not pay for it. To do otherwise would be unfair to their competitors who are paying their dues.”
The struggle by mānuka honey sellers to pay the bills is unsurprising in an industry that has witnessed the value of New Zealand’s most prized honey fall in recent years.
“Market conditions are expected to remain challenging for the next financial year,” Wright states in the report.
“Feedback to the UMFHA from members and the markets also makes it clear that if brands continue to compete based on price without investing in demand and maintaining a premium proposition the risk of accelerated decline in returns is very high.”
Also detracting is the use of the UMF trademark on honey which does not meet the Association’s quality standards. Wright did not elaborate on how many of the 26 terminated licence holders may have been shown the door due to “quality” or “compliance” breaches, but an increased budget for in-market international testing of UMF product is indicative of an ongoing concern.
UMFHA test all batches of UMF licenced product for compliance, earning it a ‘UMF release certificate’, before it leaves New Zealand’s shores. However, what happens to the mānuka honey after that – which may alter its state, either intentionally or unintentionally – is outside their control, yet still a risk to UMF’s reputation. That’s where the need for testing of in-market product, either randomly or when they are tipped there could be a greater risk of non-compliance, comes in.
“We routinely purchase UMF-endorsed product from the market, return it to New Zealand under quarantine rules, and have it tested for compliance to the standard in an independent laboratory. The whole process is managed independent of us, and we have a good budget – $100,000 this year –to support the programme,” Wright explains.
If the UMF release certificate testing in New Zealand is a fence at the top of the cliff, the “market quality testing” conducted offshore is akin to a police force operating at the bottom, but its powers are limited.
The UMFHA can bite – as some now former licence holders have recently discovered – but once non-compliant honey is offshore, there is nothing the Association can do to enforce its withdrawal from sale. Combined with honey’s long shelf-life, consumers are potentially being exposed to inferior product for years if the licensee and their retailers do not act to withdraw the product from sale.
“Our initial approach to any breach of the licence agreement is to always seek constructive agreement with the affected licensee to fully remedy the breach in a timely manner,” Wright explains.
“We also seek to understand what went wrong to cause the breach, encouraging continuous improvement with the licensee and in the processes managed by UMFHA. If we are not confident the breach will be addressed effectively or in a timely manner, then we activate a more formal process laying out the expectations and obligations. If further escalation is required, it becomes a matter for the Board to determine whether to initiate the licence termination process. We do not activate this step lightly, but there comes a point where the rights of the organisation and its wider membership must be protected.”
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