The American Pecan Council has been reporting monthly pecan handler inventory for several years now and the USDA has been reporting overall pecan inventory for even longer. The pecan inventory reports have industry players talking about a possible shortage by the summer time if demand continues to rise over the next months.
As of current demand for pecans is slightly down over last seasons record breaking year, but is still comparable to years prior. The demand charts are showing currently we are very similar to the season before last and slightly above the year prior to that. Demand has been on the rise for some time now as the APC has been spending big to educate consumers about the health benefits of pecans as well as new cognitive studies for the effects on the human brain.
The work has been prosperous as American pecan growers have seen demand for pecans rise over the last few years even in the face of a trade war and a global pandemic. This year may be slightly different. For years we have been watching the demand in relation to the available supply capacity of the industry which has at times shown us the need to be able to increase the supply faster than what we are currently doing. When the trade war shut down access to China for nearly 2 years pressure eased on growers to continue the expansion.
That of course is changing fast. With the option to apply for tariff reductions, Chinese buyers are once again back in the market and we are again seeing supply levels drop. The November position report shows just how significant a minor change in the market can be. The November position report shows the lowest levels of pecan inventory in the last four years. The USDA Cold storage report also confirms the same thing, showing overall holdings at their lowest levels since November of 2017.
While pecan cold storage continues to be on the radar, demand for pecans will of course be the major factor to keeping buyers without supply chain disruptions. Prices are holding steady on the shelves as well as the farm as handlers are willing to pay more to secure needed inventories for end users.