Amidst rising demand for natural-health solutions, kava producer Fiji Kava (ASX: FIJ) has reached an agreement with Green Cross Health (NZX: GXH) to supply kava products to more than 350 pharmacies in New Zealand.
A leading healthcare provider in New Zealand, Green Cross Health will stock the kava powders and capsules exclusively for a 12-month period.
“There is a major resurgence of global demand for kava as anxiety disorders and depression continues to grow in our society, and New Zealand and its strong Pacific Island population is central to the growth in kava demand,” said Fiji Kava founder and Managing Director, Zane Yoshida.
“Kava is a product designed to target areas such as stress and anxiety relief, so pharmacies represent the perfect placement channel for Fiji Kava’s products.”
Commonly consumed throughout the Pacific Islands, kava is produced from kava roots to produce a bitter drink which offers consumers sedative, anesthetic and euphoriant effects.
This initial Memorandum of Understanding with Green Cross Health forms the first stages of a strategic initiative from Fiji Kava to expand its global distribution with the view of penetrating key markets in Australia and the United States next.
Demand for Fijian kava has increased in recent years with New Zealand and the United States accounting for 75% of exports over the past five years with the product also achieving annual export growth rates of 32% per annum.
“In New Zealand, as in other Western markets, stress and anxiety is a growing concern,” said Green Cross Health General Manager Operations and Merchandise, Jason Reeves.
“Kava is becoming far more prevalent as a ‘plant-based’ natural alternative to addressing these issues, especially in New Zealand where there is a significant Pacific Island community.”
Listed on the ASX and operating out of Fiji, Fiji Kava offers farm-to-shelf supply of their kava products which are grown their farm in Levuka, on the island of Ovalau, Fiji.
Fiji Kava reported a net loss of $4.76m in FY19 but attributed $1.72m of that to their establishment expenses and $717k towards establishing their initial suite of Kava products. As at June 30, 2019, the company had $2.3m in cash and no debt with FY20 expected to see a major uplift in sales revenue.