Impacts of the American Pecan Council's Recent Revisions to Two-Years of Monthly Reports

May 22, 2020

Under the Federal Marketing Order, the American Pecan Council is required to audit at least 25% of the handlers each year to ensure compliance with the order.  Not only do the audits ensure compliance, but it is an opportunity to increase dialogue between the industry and the organization responsible for increasing consumer knowledge of pecans, their health benefits, value and versatility. During a recent audit, it became apparent that the handler being audited was confused as to what should be reported.  This ‘misunderstanding’ led to the submission of incorrect data to the Council.  Because this was a very large handler, the errors had a significant impact on pounds shipped, pounds held in inventory and pounds committed to be shipped.  To ensure that the industry is provided with the best possible data, the APC went back to September 2018 and revised every monthly report.  The revisions were posted last week to the APC website.  If you have not seen them, it is highly recommended that you do so.  The changes answer a lot of questions that have been asked over the past few months relative to the USDA Cold Storage data.   A big ‘Thank-you’ to Emma Garner of the APC for taking the time to correct two-years-worth of reports.

As for yesterday’s release of the April Cold Storage Holdings, while the raw numbers for the past three months may look bad, they are not!  In fact, when compared to over 25 years of data, the trend line is well within historical shipment norms.  Further, when viewed in the light of ‘days of available production,’ the figures are significantly lower than many previous crop years.  Why is that important?  It is important because prices have been negatively impacted by what appears to be a higher than usual inventory.  While that may be good for the buyers, it is not good for either the growers or shellers.  Based on currently available data, consumption is running well ahead of last year, exports are up across the board and US Consumption is holding steady, even in the midst of a pandemic.  Supplies of many items are tight. Current prices reflect more fear, and a lack of understanding within the market, rather than reality.

Finally, thanks to the APC revisions, it would appear that through March, Mexico has shipped almost 9-million pounds of inshell to China through US ports.  While this is not an exact number, it illustrates the need to get the Department of Commerce to create at least two new HS codes; one for US inshell being shipped to Mexico for processing and resale in the US, the other for foreign product simply passing through the US on its way to China.  Through March, the combination of the two has resulted in an overstatement of total supply by almost 40 million pounds.   By law, the APC is not allowed to lobby.  Both the USDA and the Department of Commerce have told the APC that they will not discuss the issue with them as that would be ‘lobbying.’  The problem must be addressed by the industry as a whole.  I hear a lot of complaining about the low prices.  Continuing to ignore the problem is not acceptable. On more than one occasion the NPSA has raised the issue with the USDA and Department of Commerce only to be told that they do not represent the industry as a whole.  When are the growers, and their powerful State organizations, going to join the NPSA in their fight to get this issue resolved?  The APC is willing to act as a facilitator.  As stated before, we need to take advantage of our 32 Senators and 200-plus congressmen.  The Department of Commerce and USDA are supposed to work for us, not against us, but until we approach this as an industry problem, it is not going to be resolved.