US Pecan Consumption Continues at a Healthy Pace
May 08, 2014
One cannot increase consumption without adequate supply. Barring the introduction of artificial outside influences such as price supports, protective tariffs, etc., this is always true.
Keeping that in mind, as statistics go, March was a very good month for the Pecan industry. While on the surface it may not seem like it, the March Cold Storage Holdings and the Foreign Ag Statistics Export figures were full of good news. Yes, there were a lot of pecans being held in cold storage as of March 31 (311.8 million pounds, inshell basis), and “Yes,’ US exports are still down worldwide. However, almost all of the reduction is still due to China. When one compares the February month end export figures to the March figures, it is apparent that US exports continue to improve. At the end of February, US worldwide shipments were down approximately 32%. By the end of March, shipments were down only 24.3% over the same period a year ago. Shipments to China also improved. At the end of February, shipments to China were down approximately 52%. By the end of March, shipments were down only 38.5% over the same period.
The Cold Storage Holdings also provided some new insight into the size of the 2013 crop. While the USDA will not release their final crop figures until July, based on the March Cold Storage figures, it is glaringly apparent that the 2013 crop was much larger than recently projected. Many within the industry had recently estimated the crop to be between 170 and 190 million pounds, inshell basis. However, when one works the numbers, it would appear that the US crop was well over 220 million pounds; possibly as high as 245 million pounds. Considering that almost 6 million pounds of meats crossed into the US in March yet the industry’s cold storage holdings still declined 1.6 million pounds, it would appear that US consumption continues to move at a healthy pace.
The Mexican crop was also much larger than earlier projected. Based on recent Customs figures, as of April 30th over 138 million pounds (inshell basis) have crossed into the US. That is 8 million pounds more than the major industry groups had projected for the entire year and there are still four more months in the 2013 export year. As an added bonus, less than 1 million pounds of inshell has crossed the border into the US since February28th. With no remaining Mexican inshell to purchase, Mexican buyers are being forced to enter the US market to purchase badly needed meats.
Overseas, both Australia and South Africa are expecting good ‘on-year’ crops. Australia is expecting a crop of approximately 6.8 million pounds (inshell basis) while South Africa expects to harvest approximately 22 million pounds. Unless the recent freeze in the Southwestern US did significantly more damage than originally projected, pecans should continue to be the best value for the nut meat dollar.
As usual, should you have any questions, please do not hesitate to contact me at 630-879-5200630-879-5200.