Prices for assessed kernel items declined in the global pecan market during the week ending on Friday as demand eased and trade activity for both kernel and inshell slowed.
“Everyone is in limbo at the moment,” a U.S.-based sheller said on August 7. “It’s one of the strangest markets I’ve ever seen.”
Fancy Med Pcs led the decline, shedding 11 cents on the week to $4.67/lb FOB Texas. As a result, the Fancy Med Pcs premium to Fancy Jr Mam H narrowed to 14 cents, down from 23 cents the prior week but still above its 24-week average.
Fancy Med Pcs have been in tight supply most of the year against steady demand and have traded at premiums to Fancy Jr Mam H much of the year. A second U.S.-based sheller said his Fancy Med Pcs sales this crop year have averaged $5.01/lb FOB Texas.
The high prices for Fancy Med Pcs compared with other items have led to an active inter-handler market for halves and larger pieces, which shellers have been buying from the U.S., Mexico, Argentina, and South Africa to cut into medium pieces.
Meanwhile, assessed prices for Fancy Jr Mam H and Fancy Lge Pcs both lost 2 cents on the week, falling to $4.53/lb FOB Texas and $4.35/lb FOB Texas, respectively. Ample offers for Fancy Jr Mam H were left unfilled at lower levels at the close of the August 5-11 assessment period.
In the inshell market, assessed prices edged higher in limited trade as growers continued to hold for prices that shellers appeared largely unwilling to pay. Western Inshell offers were reported from $3.50-$3.55/pt FOB Texas farmgate with buying interest at lower levels.
Discussions gathered momentum about prices for kernel and inshell items that will ship from the upcoming 2023 crop.
New crop Fancy Jr Mam H was offered at $4.65/lb CIF Europe but found no buying interest at that level. Demand for new crop Pawnee Inshell for the gift pack market was reported at $4/pt FOB U.S. but failed to attract sellers at that level, shellers in the U.S. and Mexico said.
New crop pricing discussions came as participants tried to gain a better understanding about the size and quality of the upcoming crops from the U.S. and Mexico.
In the U.S., participants continued to question production from Georgia after two recent estimates of the size of the state’s upcoming crop diverged by 25 million lbs. Georgia is the top pecan producer in the U.S. “The larger question for those of us trying to understand the market is what is Georgia capable of in the near term,” a third U.S. packer said on Wednesday.
In Mexico, some pecan trees began dropping fruit as a bout of dry, hot
weather continued to raise concerns about the quality of the pecan crop there. The hot weather could leave kernels from Mexico drier than normal, leading to higher rates of kernel breakage during the shelling process and a larger supply of pieces, crop observers said.
“The crop size will probably be bigger than last year, but I think quality is going to be the biggest risk,” a Mexico-based sheller said on Thursday.