News Archive

Almond shipments for October 2011 set another record. According to the October Position Report that was released only moments ago, the industry shipped over 219.5 million pounds in October; over 30 million pounds more than last year's October shipments. As such, prices will probably continue to firm as the industry trys to get a better handle on the actual size of the crop and catch up on orders. Sizes are still very small with one Sheller advising me that of the first 5 million pounds of product processed, less than 80,000 lbs sized out at 18/20 and less than 150,000 lbs sized out as 20/22.

While some segments of the Pecan industry like to discount the governments Cold Storage reports, statistically speaking, history has shown them to be a fairly good predictor of future market trends. On Monday, August 22, 2011, the USDA released their July Cold Storage report, and for the first time since November 2011, the meat inventory showed a significant decline over the prior month. Further, on an inshell converted basis, July's shipments were also more in line with historical averages. Based on the raw data, overall consumption is down only 12%. When one takes into account the governments double counting of the Pecans going to and coming from Mexico, the actual figure is closer to 18%.

In another example as to why the Pecan Industry needs to develop a better way to collect crop information, the USDA released their final 2010 Pecan Crop Estimate raising their preliminary estimate from 259.66 million pounds (inshell basis) to 293.74 million pounds; almost a 12% increase thereby making the 2010 crop only 2.7% less than 2009's 302 million pound crop. Based on today's figures, it would appear that consumption is running about 19% behind last year's record numbers. Further, it would also appear that the alternate bearing cycle of the trees has changed.

The USDA released their 2011 Objective Almond Crop Estimate today projecting a 1.95 billion pound crop (kernel basis) based on 750,000 producing acres. This figure is 11% ( 200 million pounds) higher than the May Subjective Estimate and 19% higher than last year's crop. While many within the industry felt that the May estimate was on the low side, the 1.95 billion pound figure was a bit of a surprise. While it will take a few days for the market to digest the new information, overseas markets have already started to exert some downward pressure on prices. However, even with the larger than expected figure, it does not change the fact that the crop is running several weeks late and could result in a harvest that starts even later than last year's did.

As has become tradition, the Louisiana Growers are usually the first group to try and put a figure on the upcoming Pecan crop. Even though their estimate comes out very early in the season, over the past few years their track record has been pretty good.  This year, due to adverse weather during the early part of the growing season throughout much of the Pecan belt, many within the industry did not expect this year's 'on year' crop to be much above historical averages.  Most felt that the crop would be in the range of the 2009 'on year' crop of 301 million pounds, give or take 10 million pounds.

Record May shipments and a late crop have caused most sellers to pull back while they evaluate their positions. Based on May shipment figures, the industry shipped almost 42% more almonds in May 2011 than they did a year ago.

About the same time, the Almond Board announced that they were pushing back the release date for their quantitative crop estimate to July 6th because the crop has not matured enough due to milder than expected weather during the first half of the year. Some within the industry have indicated that the crop could be as late as, or possibly even later than, last year's crop.

Based on the latest USDA Cold Storage Report, it would appear that at this time, record market prices have not adversely impacted demand. While demand from China has temporarily slowed, meat shipments continue to be very strong to the domestic market. As expected, there are shortages of Mammoth, Jr Mammoth and Jumbo Halves, as well as Large and Medium Pieces; however, Shellers do not appear to be having any problems supplying their customers.  Although it is still too early to say how the higher prices will impact consumption later in the Spring and into the Summer, Spot buyers may have difficulty getting adequate supplies as new crop approaches.

This past Friday, two significant figures were released by the USDA, National Ag Statistics Service. The first, and most significant, was the revision to the final 2009 Pecan Crop figures. From a background standpoint, when the final figures were released by the USDA last July, they put the 2009 Georgia Pecan Crop at 90 million pounds.