We have finally made it to the point in time where the market should be stabilizing from a good flow of in-shell, China’s supposed exit and the gift packers meeting their procurement needs for their Fall trade. However, challenges from an overall 2013 domestic crop production coupled with an unreliable cold storage report has the industry in what seems like utter confusion.
As of today the crop has been coming in slow, but steady from a shellers perspective. Yields and quality have been reasonably good despite the challenges we faced in Georgia from rain, but purchasing in-shell Pecans at a marketable level with the goal of making a profit is proving difficult with sub-$4.00/lb. piece prices still floating around on the spot market. The question is, how much inventory at this level is available? The cold storage report dropped just north of 40M lbs. (CS 10-13) in October presenting a little more of a bullish attitude in the market place as both growers and shellers see the carry-over(lower priced inventory from ’12) depleting at a rate of more than double YOY for the past 10 years. Halves have been and will continue to be very bullish. Currently, high-priced new crop in-shell coupled with the low price piece market is driving halves up. Even with China’s somewhat weak involvement in the market this Fall and Mexico’s “large crop”, halves will most likely get above $6.00/lb. in December due to the shorter supply estimated to be as much as 150M lbs. off from ’12-’13. The million dollar question is how much supply do we have left to last us now from carry-over/’13 production and at what level will the farmer sell verse putting in cold storage? In the next couple of weeks farmers across the entire Southern US will be harvesting and we should have a very good idea as to where the market is headed for ’14 contracting.
If you would like a quote on Pecans, please do not hesitate to contact me on my email [email protected] or in my office 229-244-1321.