Market News Pecan Nuts December 2023
The Pecan harvest continues in most of North America, from October to January, with Mexico and the USA accounting for over 90% of the world’s pecan production.
The remaining pecans are harvested in South Africa, Australia, Brazil, and other southern American countries from June to September,
This year, the crop has been 20% lower than expected in the Southern Hemisphere.
We are looking at a similar drop in harvest volumes from North America this season, with around 40% of the growing areas already harvested.
"We will be around 20 or 30 percent shorter than last year," an inshell broker in Mexico said on Monday. "And the trees are still wet and green, so we're behind."
The total volume harvested last year was around 650 million. We may end up with 520 million lbs for the 23/24 crop.
The data taken from Stratamarkets Pecan Report paints a worrying picture for 2024
Kernel prices in the global pecan market rose during the week ending on Friday. Harvests in parts of Mexico and the U.S. were behind schedule, causing sellers to withdraw from the market or raise their offers.
China had contracted at least 85 million pounds of pecans from Mexico and the USA. This leaves only 555 million pounds available for the rest of the world to purchase. The demand for pecans in the USA was around 520 million pounds last year alone.
You end up with only 35 million lbs left over for Canada, Mexico, and Europe markets, which are heavily demanding countries with around 150 million lbs between them.
Plus, there is demand from emerging consuming markets like India, the Middle East, and Japan.
Assessed kernel prices rose in the global pecan market during the week ending on Friday with harvests in parts of Mexico and the U.S. behind schedule, prompting sellers to withdraw from the market or raise offers.
We are already seeing customers hesitating and afraid to come into the market, apparently because there were some early volumes in October that were locked in by some impatient shellers speculating on the harvest size, and prices were contracted well below current market prices.
These deals will either make the seller, or the customers lose some money (seller by delivering under market price or customer by not getting a product delivered).
Nevertheless, we see smarter, more conscious customers realising that they will end up with no pecans if they do not lock in their 2024 requirements.
According to the latest USDA Cold Storage report released on Wednesday, U.S. stocks fell to their lowest point in October, reaching levels not seen since 2011.
The report shows that U.S. supply was at 102 million Inshell Equivalent (ISE) pounds in October, which is a 15% decrease from 120 million pounds in the same month last year.
Typically, the supply starts to increase in December.
To put it bluntly, not enough nuts will be harvested to meet the demand for 2024. And prices will go up.