The USDA released the first of their three 2009 Crop Estimates
October 12, 2009
The USDA released the first of their 2009 Pecan Crop estimates this past Friday estimating the crop to be 309.2 million pounds (inshell basis). If this figure is correct, when one combines it with an estimated 2008 carryout of 85 million pounds and the140 million pounds of Mexican inshell that is expected to cross the border, total supply can be expected to be somewhere in the neighborhood of 534 million pounds. With consumption currently running between 415 and 435 million pounds, this will leave approximately 110 million pounds to carry into the 2010 'off-year' crop. For a significant part of the current crop year, the industry has experienced a shortage of Mammoth, Jr. Mammoth and Jumbo Pecan Halves, as well as many of the larger piece sizes. Helping to exacerbate the problem, China continues to purchase only the cream of the crop, and while their appetite for Pecans over the past few years has helped to stabilize prices, thereby leading to increased consumption, the lack of sufficient supplies to continue to feed their veracious appetite could be expected to lead to pricing problems in the months ahead.
On a positive note, the price of Almond and Walnut meats continues to move higher. Further, the exchange rate for the US Dollar continues to remain relatively weak overseas. As such, even with a moderate increase in prices, Pecans could continue to offer a better value for the dollar over their cheaper competitors.