2016 Mexican Crop Sets New Record as China's Appetite for Shelled Pecans Contiues to Increase

May 08, 2017

Back in September, during their annual meeting, the Mexican pecan growers projected a 2016 crop of approximately 270 million pounds.  After two consecutive years of record crops, many within the industry greeted the estimate with skepticism even though it is common knowledge that plantings in Mexico continue at a robust pace.  This past Friday, May 5, 2017, the Mexican Agricultural Information Service released their official figures on the crop; 310.4 million pounds.  Not only is this another record crop, but it is also the third year in a row that Mexico has out-produced the US. For those who may still doubt the number, consider that fact that Mexico has already exported more than 201 million pounds (inshell basis) to the US with almost three more months to go until the end of the FAS crop year.  On a net basis, that equates to 191 million pounds; 5 million more pounds than all of last year.

As for overall US pecan exports, China continues to surprise everyone.  While inshell exports to China continue to be less than originally projected, exports of shelled meats are approaching record levels.  Through March, China has imported almost 11 million pounds of meats; 24.9 million pounds inshell basis.  Imports of shelled meats to China are currently accounting for 27.5% of all pecan shipments to China (inshell basis).  During the same period last year, meat shipments accounted for only 6.5%.  Should shipments continue at the current pace, China could set a new record for overall imports of pecans. With an overall shipment total of 90.4 million pounds (inshell basis through March), China could surpass 100 million pounds.

South African growers, who received record prices from China last year, are poised to harvest a record crop this year.  Barring a natural disaster, South Africa is projecting a crop of 12 to 13 thousand tons (26.5 to 28.7 million pounds). While the harvest is still three to six weeks away, and with no inshell left in either the US or Mexico, Chinese buyers have been actively involved in the market.

Based on currently available data, consumption would still appear to be off by about 10%.  However, China’s increased appetite for shelled meats, as well as the firming walnut market, could keep pecan prices relatively stable for the next few months.