Pecan Prices Continue to Soften as the Pecan Market Continues Downward Spiral

Pecan Prices Continue to Soften as the Pecan Market Continues Downward Spiral.jpg

The approach to this year’s pecan harvest season was somewhat normal with demand for pecans continuing to rise in the global marketplace, pecan growers were entering the season with a good pecan crop and plenty of optimism. However, that quickly changed when the US China trade war resulted in a steep 47% tariff on US Pecans bound for China. Now pecan growers are scratching their heads wondering what to do with their crop. The pecan shelling industry has learned over the past years that trying to compete with China for in-shell pecans is a tough battle to win. Therefor most pecan shellers have learned to stock up and buy after the Chinese New Year rush, so as to not compete with the Chinese for in-shell. This year has been quite different, with Chinese pecan buyers showing little interest in US pecans this year, pecan growers have flooded the market with pecans causing pecan prices to soften and offers have started drying up. The price drop in the market has become so significant that even pecan shellers are asking growers to hold your product and stop taking low ball offers. The pecan sheller is in the market to buy the in-shell pecan as cheap as possible to allow for a larger profit margins when the shelled pecan is later sold. However shellers are now saying that buyers are sitting out of the market because the sell off is causing prices to continue to drop and buyers are sitting out waiting for the bottom. Shellers are now asking growers to hold their pecan crop, and stop the downward pressure on the market. The pecan market is the only nut market in the world where growers by in large sell off the raw product at harvest time and take cash payments in those same harvest months. The issue is compounded by the Mexican pecan crop flooding the market at the same time, and having one of the largest crops ever produced in Mexico. For now it seems buyers with cash will continue to take advantage of the pecan sell off getting massive discounts for a product that is in high demand and rising globally.