Bear Market for In-Shell Pecans

Bear In-shell Pecan Market.jpg

The pecan market has been quite steady for the past few years with a slight uptick in prices from year to, well this year could be the year that direction changes for American pecan farmers, as we are now only days from harvest.

 Ask any American Pecan farmer over the past few years, how the market has been, and he or she will likely tell you prices have been good with demand continuing to rise for pecans around the world. However, that may be changing this year. As we move into the pecan harvest season for North America we see in-shell pecan prices continuing to inch downward while offers continue to be very light. No more than a month ago several pecan buyers began to offer contracts for oversize but that has dried up very quickly and pecan prices are now continuing to slip. It seems that the industry is at a bit of a standoff, with pecan buyers not wanting to set prices too high and growers not wanting to sell their pecans too low. Exactly one year ago Oversize pecans (OVS) was trading at $3.26 per in-shell pound. Today that same pecan is trading at $2.51 per in-shell pound, that’s a $0.75 difference, but the issue is that very little product is being traded, and prices continue to inch lower. On a positive note, it would seem that pecan halves are almost nonexistent in the market, but pecan pieces are quite abundant. The pecan shellers will need to buy quality product in order to fill pecan halves contracts, and since China is currently sitting out of the market, it has opened up interest to more domestic buyers that previously found the oversize in-shell cost prohibitive due to stiff competition from the Chinese pecan buyers. The Chinese will no doubt buy plenty of pecans this year, but it’s more of a matter of when, the Chinese are savvy traders and will play the market accordingly. In the meantime, it would seem many growers are making plans to store their crop, saying that “we know the demand is out there, we just gotta be patient”.