March Cold Storage Holdings the Third HIghest ever. However, Comsumption also Appears to be Higher.
April 22, 2019
The USDA NASS released the March Cold Storage Holdings today, and as might have been expected, revised upward the February holdings by approximately ten million pounds (inshell basis). Why was this expected, because of the American Pecan Council report for February. With the exception of November 2018, the difference between the USDA and APC figures has been relatively consistent. The current revision puts the two sets of figures back into sync. While there is still insufficient data to say if this trend will continue, the revision adds credibility to the veracity of the APC figures. It will be interesting to compare the APC March figures with those of NASS once the March APC figures are published. Regardless, the industry should be very happy with the inventory figures being published by the APC. Further, it shows that the NASS figures have always been much more accurate than many within the industry had felt.
Based on today’s release, it would appear that the industry has the third highest inventory ever surpassed only by March 2013 and March 2014. Looking at the overall numbers, the industry’s current inventory position, at least for now, appears to be mirroring 2014. When one considers that Mexico shipped close to 18 million pounds (inshell basis) into the US in March, the fact that the cold storage figures did not increase more is testament to what appears to be a significant increase in consumption. Internationally, while overall US exports are down due to the trade dispute with China, shelled kernel shipments appear to be up by approximately 11.5%. US Consumption appears to by up slightly over 5%. As a result, kernel prices have begun to firm, particularly for halves. While the price differential between pieces and haves continues to larger than historical averages, piece prices have at least stabilized, and in some cases, begun to firm.
As for Mexico, crossings continue to set new records. Through April 14th, Mexico had shipped approximately 230 million pounds (inshell basis) into the US; a 33.5% increase over the same period a year ago. Current shipments are also 18.8% ahead of 2017’s record pace.