The American Pecan industry may be facing a supply shortage in the near future as pecan commitments continue to grow.
Pecan imports into the US have been at record highs as many US growers have been storing pecans waiting for price to increase in the US. Currently Oversize (GCE:OVS) and Extra Large (GCE: XL) pecan prices paid to growers outside the US are slightly higher than prices paid to growers in the US. Since the onset of the China US trade war, China has shifted purchases away from US Pecans to countries with lower tariffs, resulting in downward market pressure on US based pecans. But that is slowly changing as supplies from Mexico are running out and may soon have a 5% or greater tariff levied against them when entering the US.
Over the last 8 months the US has imported roughly *84 million pounds of pecans of which 99% came from Mexico. With pecan supplies in Mexico dwindling, and China buying most of the South African pecan crop, American shellers and accumulators may have to become more aggressive in order to fill the unfilled future commitments.
*All pecan data has been converted to In-shell totals
*C2i – Converted to In-shell
*It is important to note that the above chart “Monthly Pecan Imports and US Pecan Shipments” shows approximately 75.3 million pounds shipped over the last 8 months when the actual cumulative total is 84.3 million pounds; a difference of 9 million +/- pounds. With out amended monthly reports there is no way of knowing which months to adjust, therefore in order ta arrive at cumulatively accurate data, distributing the 9 million pound excess evenly over the eight month range would add 1,127,684.5 lbs to each of the 8 months equaling the amended cumulative total. Another more accurate way, in my opinion, would be to distribute the 9 million lbs based on monthly percentages of the total.