Pecan growers have been hard at work in the orchards as bud break is here. Trees are forming pecans and leafing out across the southern US and Mexico. Growers have finished (mostly) planting trees for the season and have largely shifted focus to growing this year’s crop.
The demand for pecans is increasing and the pressure for growers to produce more pecans is mounting. Growers have been feverishly planting new orchards to increase supply capacity but demand continues to outpace the supply.
The expansion of a growers pecan orchard is no small task, requiring a significant upfront investment with several years of sustained care before a harvest, and revenue, can be generated. The ability to increase supply is restricted by growers’ ability to outlay the capital and service the orchard and the debt for several years before any return can be expected. All the while growers are at the mercy of mother nature as well, it’s no small risk.
We take these risks because we believe the reward will be worth it when we get our orchards to commercial harvest capacity. Lately growers have been somewhat disappointed as supply capacity increases. Pecan prices have been dismal in prior years even as the demand for pecans increases. We have seen new markets open up and have invested millions of dollars in advertising and awareness of the health benefits of pecans, however the increased demand for pecans seems to only benefit a handful of people at the top of the supply chain while growers continue to see mediocre prices for their harvests.
With such large investments in time and capital more and more growers are asking the questions, “why are farmgate prices not increasing”. Growers became so frustrated with the situation that they voted to abolish the federal marketing order known as the American Pecan Council, however the staff was able to find enough large acreage owners to vote yes to keep the marketing order alive. On a personal note I think it is foolish to abolish the marketing order, unless we can replace it with something better.
As growers continue to look for answers to the lulling prices, transparency in the industry has been number one on growers minds and tongues at the latest meetings. Mr. Larry Don Womack has suggested an evaluation of our efforts and contractors as a start to see what is working and what is not.
Mr. Mike Adams encouraged growers to be patient and that “the benefits will eventually trickle down to the grower level”. But growers don’t seem interested in waiting for the efforts to eventually trickle down. As one grower said, I don’t invest my time and money with the hopes that the value will trickle down. And I agree with that grower, I think we should be taking a grower first approach to the marketing.
With the recent elections and changing of board members on the APC, transparency seems to be a theme that more members are after. With the fresh faces on the board and new ideas coming in growers expect to see farm gate prices reflect the increasing demand for pecans.