Nature's Finest Foods, Ltd.

Specializing in the markteting of tree nuts.
10/15/18

While it may be months, possibly years, before an accurate assessment of the damage caused by Hurricane Michael can be determined, there is no doubt that the Georgia crop was hurt. Initial estimates put the losses at somewhere between 30 to 45 million pounds.  The hurricane marched through the largest production area in Georgia, and in the words of one horticulturalist, the only bright spot may be that Mother Nature finally removed a number of trees that should probably have been removed years ago.  Due to current market prices, many of the affected growers may decide not to salvage what they can as their insurance will pay more than what it will cost to clean-up the debris and pick-up the nuts. So, what does this mean for prices? Probably very little. World supply was already projected to be a record and the hurricane’s impact was primarily felt in Georgia.  With China not buying, losses would have to exceed 81 million pounds just to account for what China purchased last year.  While current prices have leveled off, based on current projections, there are still plenty of pecans to handle expected demand.

This past week, the American Pecan Council (APC) released their 2017 crop statistics.  The report was much anticipated and did not disappoint.  For the first time, the pecan industry had a good look at what had been purchased, what was exported (and to where), how much was shipped to Mexico and returned as meats, and most importantly, what was in inventory (cold storage).  As most sheller’s will attest, the industry has been short of halves for several months now.  Based on the APC figures, as of August 31st, the industry was oversold on halves by over 3 million pounds. Conversely, there are a lot of uncommitted pieces; almost 9 million pounds or 35.47% of the total supply of pieces.  That would explain the significant price difference between the two. While there will probably be some modifications to the figures, based on crop receipts, the 2017 crop was 312.94 million pounds; approximately 19 million pounds more than the USDA July figure. While there are significant differences between USDA NASS, USDA FAS and APC data in some areas, the industry now has the ability to challenge the USDA figures. This should lead to a better understanding of how the USDA collects its data, who they collect it from and who may not be reporting, as required, to the APC.  With monthly reports expected to be published beginning at the end of this month, the data will only get better.

Speaking of USDA crop estimates, NASS released their first estimate of the 2018 pecan crop; 278.9 million pounds, inshell basis.  As has been mentioned in the past, this figure only includes production from the eight largest producing states.  Based on historical data, and recently released APC crop data for 2016 and 2017, this would put the crop at approximately 307 million pounds (pre-Michael).

Mexican imports continue to be ahead of last year. Through October 10th, 36.4 million pounds had crossed the border (inshell basis) vs 24 million a year ago.  Exports were also ahead of last year, even without China; 16.7 million pounds vs 9.4 million a year ago. 

While pecan prices still are well above those of almonds and walnuts, the differential has narrowed dramatically.  Barring any additional crop setbacks, the industry should expect to see a significant increase in consumption, especially in the baking and snack segments. Having said that, please keep our friends in Florida, Georgia and the Carolina’s in your thoughts and prayers.

 

This website contains only pecan related statistics. For statistical information on other tree nuts, click the appropriate link(s) above.