Sanitarium has probably fallen victim to the problems of being in the middle of the peanut butter market, one expert says.
It told RNZ that production of its peanut butter products stopped in late July.
"After careful consideration and analysis, Sanitarium Health Food Company made the decision earlier this year to cease production of its peanut butter range due to declining customer demand and growth of other favourites.
"Our people have proudly produced every jar made and we thank all our loyal consumers over the last 100 years for loving our quality range of peanut butters.
"Sanitarium understands that this may be sad news to some consumers, and we sincerely apologise for any disappointment caused."
It comes after a decision earlier in the year to stop making muesli, granola, flake, cluster and puff cereal from next June.
In recent years, a number of new peanut butter brands have cornered the more boutique end of the peanut butter market.
Bodo Lang, a marketing expert at Massey University, said the peanut butter market was highly saturated and shoppers had a lot of choice.
"An online search at Woolworth's shows nearly 80 peanut butter products. This includes well-known large brands and more recent arrivals, particularly at the premium end of the market. So the peanut butter market is crowded.
"Different tastes and budgets are catered for with many product variants being available and the price of peanut butter ranging substantially. The least expensive product costs just over $0.50 per 100 grams, while the most expensive costs nearly four times as much at $2 per 100 grams.
"Without any meaningful differentiation, it is difficult to be in the middle of this competitive market. And that is where Sanitarium used to be positioned."
Lang said it was likely that Sanitarium was withdrawing from peanut butter as part of its effort to tighten its product portfolio.
"[This] will allow Sanitarium to concentrate on its main brands which are Weet-Bix and Up&Go, [and] focus their resources, including paid promotion in supermarkets, to more effectively cut through the clutter of the highly competitive breakfast foods market.
"Focusing its resources is important because many of its competitors in the breakfast segment are very large multinational corporates with deep expertise and substantial resources to develop and market their products."
