Nuts

Pecans: US production cannot meet demand

August 26, 2021 10:22 AM, Der AUDITOR
Play report as audio

ATLANTA. As Pecan Report explains, it is becoming increasingly difficult for US farmers and producers to meet the high demand. For this reason, more raw nuts have to be imported from other origins.

China plays a leading role

As the experts at Pecan Report state, the pecan industry in the USA has been struggling for more than a decade to adjust its growth to the steadily increasing demand. The gap between supply and demand had narrowed briefly when China exited the market in the wake of the trade war. The US market expanded then, and with China's re-entry into the market, this gap is now wider than ever. China is particularly interested in buying in-shell pecans.

Large time gap between planting and production

The supply gap that the USA has to cover with imports is therefore getting bigger and bigger. In the current 2020/21 season, it amounts to a good 40,370 mt so far, but will widen considerably by the end of the season. In the 2019/20 season, US producers had supplied a total of just under 107,954 mt of raw nuts, while exporters had to meet enquiries of about 167,829 mt. The imports needed to bridge this gap were therefore just under 60,000 mt. Imports come mainly from Mexico, South America and South Africa. While US farmers are eager to increase their acreage and reduce imports, the problem is that it takes an average of ten years to get a pecan plantation up and running. According to the Pecan Report, scientists at the University of Georgia, for example, are trying to develop pecan varieties that can be produced more quickly. Cost is still the biggest problem.

Exports to Asia on the rise

Exporters can be satisfied with this season's shipments so far, which are 11,340 mt above those of the 2019/20 season, as reported by the American Pecan Council. Contributing to the higher shipments have been relatively cheap commodity prices, as well as the higher buying interest from China. Overall, traders are registering higher demand from Asian countries, especially from South Korea in addition to China. Shipments to Europe, however, have only risen slightly, while domestic consumption in the USA has increased significantly in recent years.

Prices on the European spot market are holding steady for the time being and are unchanged at EUR 9.75/kg FCA Spain for Fancy Junior Mammoth Halves from the USA.

US Pecans

Type

EUR/kg

Shelled, Fancy Junior Mammoth Halves

9.75

Shelled, Fancy Mammoth Halves

10.30

Shelled, Junior Large Pieces

7.20

FCA Spain

View more information 
price charts

View related articles

Go to the News Overview
Nuts
Sep 15, 2021
SACRAMENTO/MADRID. Although US almond production is expected to range lower, arrivals are currently 14% up on last year. As harvesting started early arrivals have risen. Buyers and Europe and China are taking advantage of large supplies.
Nuts
Sep 14, 2021
BEIJING. Demand for walnuts is up in China as local processors are busy obtaining sufficient supplies for the Golden Week, which is celebrated on 01-07 October. This has largely impacted prices. Prices are too high for some buyers.
Nuts
Sep 13, 2021
ORDU. Traders report that the hazelnut season has not started properly in Turkey yet. Issue is that unstable weather conditions have delayed drying. Arrivals are low and trading is still to revive. Growers are very much satisfied with prices at present.
Nuts
Sep 6, 2021
ORDU. As delays in drying hazelnut kernels at Turkey’s Black Sea coast are now impacting supplies in Europe traders urge buyers to consider a more effective supply chain management. Long queues are being reported in front of the TMO as growers are intent on selling to the state-run organisation. Prices have drifted far apart.