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U.S. loses top pecan production spot to Mexico

Shelley E. Huguley SHELLEY-HUGULEY-19-pecan-trees-8.jpg
Southwest states increasing pecan acreage

Mexico has taken over the top spot as the world's largest pecan producer, increasing production by as much as 20,000 acres a year.

COMENUEZ, a Mexican pecan grower’s agency supported by Mexico’s Secretariat of Agriculture, Livestock, Rural Development, Fisheries and Food (SAGARPA), recently estimated that by 2022 Mexico's total pecan production will reach about 330 million pounds.

Compare those figures to the U.S. In 2018, overall U.S. pecan production was 221 million pounds, down some 27% from the previous year as a result of orchard damage in Georgia.

Three years ago, the U.S. production estimate was about 75% of the world’s pecans and Mexico about 20%. Estimates today indicate Mexico is producing more than 50% of the global pecan total.

According to Jonathan Arn, owner of Carter Pecans in Albany, Georgia, the current Chinese tariff on U.S. pecans rests at 47% as of this writing.

Tariffs have been problematic

While tariffs have affected many U.S. farm products, including pecans, U.S. pecan processors and marketers should share at least some of the blame. The U.S. has long been a major buyer of Mexico’s pecans because of a shortfall in U.S. production that failed to meet domestic and global demand.

But since the trade dispute began and the U.S. federal marketing order was established through farmer payments to help promote pecan demand worldwide, some growers have complained that processors and marketers have increased their purchases of Mexican pecans, then repackaged and sold them in the international marketplace.

Since tariffs on U.S. pecans have risen over the last two years, Mexico is now selling directly to foreign markets, meaning regardless of who sells the pecans, the U.S. federal marketing order probably helped increase demand.

The U.S. Pecan Grower’s Council says more than 90% of Mexico’s pecans have been committed by contract this year already, causing the price of U.S. grown pecans to rise along with the holiday demand, meaning U.S. growers should be able to market their product effectively this year regardless of trade issues.

Richard Heerema, New Mexico State University pecan specialist, says the push for U.S. growers now is to continue expanding pecan acres in the coming years. Not only is Georgia replanting orchards following Hurricane Michael, other states also are seeing expansion.

“We’re seeing healthy growth of the industry with new acres being planted in Southwestern and Western states. Acres have expanded in New Mexico, including in areas where pecans are replacing other types of crops like alfalfa or cotton,” he told Southwest Farm Press.

He said a few walnut operations in California have changed or added pecans to orchards where pecans are more adaptable to soil conditions.

“Arizona is also experiencing growth in the pecan sector, mostly on land not currently utilized for crop production. There is more open land there to work with,” he added.

Despite the many challenges pecan producers have faced throughout 2019, most remain optimistic as early harvested varieties indicate potential for a good year for America’s native nut.

Hurricane Michael greatly damaged the Georgia pecan crop two years ago, so Southwestern states have been gaining ground as they compete for top honor as the largest pecan producer.

Traditionally, Georgia is the top producing state for many years running. Texas and New Mexico generally follow at two and three. Since Georgia’s orchards are still on the mend, New Mexico has recently taken the top spot, outpacing Texas, which has been falling behind.

Oklahoma has also been a significant contributor to the U.S. pecan crop for several years, and Arizona has been adding pecan acres at a surprising rate over the last three years and is starting to flex its muscle as a potential player in the U.S. pecan market.

According to the latest USDA Agricultural Marketing Service (USDA-AMS), U.S pecan imports from Mexico hit a record high last year with about 78 million pounds of in-shell and 107 million pounds of shelled pecans for a combined total of 185 million pounds.  (USDA-AMS produces pecan reports during the pecan season starting in October and each week through the end of March.)

Heerema says New Mexico is expected to produce a favorable crop this year but harvest has been rain-delayed in recent weeks. He adds that most producers are anxious to begin as soon as weather and ground conditions improve.

Last year, New Mexico produced the most pecans in the U.S., about 91 million pounds.

Joshua Sherman, commercial horticulture area agent with the University of Arizona (UA) Cooperative Extension, says pecan acres have more than doubled in his state over the last two years. New acreage is primarily located in Cochise County in the southeast part of the state. The San Simon, McNeal, and Bowie areas in the county have a sizeable portion of new plantings. At least four larger pecan growers have processing facilities on site.

He says Arizona producers are concerned over trade issues, but it takes several years for a new pecan orchard to become profitable, allowing time for some type of trade resolution.

“I’m not an economist, but I am optimistic we will reach a balance over time because there’s such a high demand in China and growing demand elsewhere around the world,” Sherman said.

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