Today’s USDA Cold Storage report shows an industry inventory just shy of 300 million pounds (inshell basis). Based on historical data, and assuming that consumption continues at or near its current pace, the industry could carry out as much as 205.7 million pounds of product into the 2013 crop. Combining the projected carry out with the Tri-State Pecan Growers 2013 crop estimate of 222 million pounds (released earlier today), the 2013 supply situation could shape up as follows:
2012 Carry Out (estimate) 205,700,000
2013 US Crop (Tri-State estimate) 222,000,000
2013 Mexican Imports (estimate) 130,000,000
2013 Total Supply (estimate)* 557,700,000
With 2012 crop year consumption estimated to be in excess of 420 million pounds (inshell basis), there should be enough pecans to handle projected consumption while leaving a reasonable carryout going into the 2014 crop.
With respect to the actual size of the 2012 pecan crop, the cancellation of the USDA’s final 2012 crop estimate has created a considerable amount of speculation as to the crop’s actual size. Analyzing the additional data that has become available in the last thirty days, a much stronger case can be made that the 2012 crop was in excess of 360 million pounds. Based on currently available data, especially the recently released export figures, the 2012 crop was actually much closer to 375 million pounds. While some segments of the industry might argue that the January USDA Preliminary estimate is much closer to the actual figure, working backwards with the currently available information, if the 2012 crop was really the 302.8 million pounds projected by the USDA, consumption would now be running at 358 million pounds; a drop in worldwide consumption of almost forty million pounds over last year. With overall market prices having dropped almost 50% in the past twelve months and FAS figures already showing an increase in exports to China alone of almost forty million pounds, it is obvious that the 302.8 million pound figure has no validity.
While the industry has no established mechanism to come up with an industry estimate, under the circumstances, now would be a good time to do so. Using the US Pecan group as an umbrella, perhaps representatives from the various segments of the industry could come together at either the Texas Pecan Growers meeting or the September National Pecan Shellers meeting to discuss the situation. Due to the time needed to collect the data, the latter might be the better venue. The Shellers have the means to come up with a figure from their members based on their actual purchases. They regularly developed such information years ago as part of their old statistics program. The figures were used successfully on several occasions to challenge USDA estimates and cold storage figures. If they are willing to share the collected data with the non-member Shellers, most of the non-member Shellers would probably be willing to share their receipt figures. Evaluating that information with actual Georgia Pecan Commission data, as well as currently available FAS and USDA data, would allow the industry to come up with a fairly respectable number. It would be a fairly simple, straight forward process if everyone involved is willing to put aside past differences to come up with something that is good for everyone.
As usual, should you have any questions, please do not hesitate to contact me at 630-377-2628.
*Note: Figure does not include Australian or South African production or Mexican production not shipped to the US