Thursday, November 02, 2006

US: pecan production down

The heat, the drought and the immutable rhythms of nature have combined to knock pecan production off by 70 percent or more in the San Saba area and other parts of Central Texas, early estimates indicate. "It's not going to be pretty this year," said Neal Alexander, the Texas Cooperative Extension agricultural agent in San Saba County.

Alexander predicts pecan production will hit 25 percent to 30 percent of normal in the area, and San Saba considers itself the Pecan Capital of the World. Shawn Oliver of Oliver Pecan Co. in San Saba said 30 percent production might be optimistic. One of his Central Texas orchards that would normally produce about 100,000 pounds of pecans may turn out just 3,000 pounds this year.

"Some people can't even justify getting their equipment out to harvest," he said. "There's just not enough there to go out and get." In the roller-coaster world of pecan growers, 2006 was expected to be an off year, one that routinely follows a heavy year for production. But with abnormal dryness and heat much of the year, followed by punishing rains and wind as harvest time approached, the drop-off could be steeper than normal.

In a normal off year, Texas producers could harvest 45 million to 50 million pounds of pecans, said Jose Peña, a Texas A&M University extension economist in Uvalde. According to the U.S. Department of Agriculture's initial production estimate, the state will market 36 million pounds this year, down from 65 million pounds last year.

It may not be abnormally low in all regions. Some experts, including Kenneth Pape of Pape Pecan Co. in Seguin, said growers in the Winter Garden area south and west of San Antonio should have a fairly strong crop if they irrigated enough and managed their fields well.

Gary Schmidtke with South Country Pecans near Pearsall said that at the halfway point of the harvest early this week it was hard for him to say if the yield would fall short of his reduced expectations. "It'll be another two or three weeks until we have a good fix on it," he said. An off year for production does not mean, however, that pecans will be scarce as families begin to plan their dessert menus for the holiday season.

H-E-B spokeswoman Dya Campos said retail prices this fall are the same as last year. Peña reported that initial estimates call for nearly 134 million pounds of stored pecans to be carried over nationwide from last year's crop.

That's almost twice the size of the carry-over inventory that was available last year and would push the nation's total pecan supply to about 335 million pounds. The total is only 11.1 percent smaller than the 2005 pecan supply and is 50 million pounds more than the 2004 crop, which produced record prices, Peña said.

With pecan imports, including an estimated 70 million to 80 million pounds from Mexico, the United States' surging appetite for pecans should be satisfied, officials said. Pape said one exception could be the large paper-shell pecans that are popular early in the season but were hit particularly hard by the drought. If Georgia, the nation's leading pecan producer, has a weak crop, shortages for top-end pecans could arise, Pape said.

The U.S. is the world's largest producer of pecans. Georgia is expected to raise the most pecans this year, followed by New Mexico and Texas. In 2006, the U.S. Department of Agriculture predicts pecan output nationally will reach 201.4 million pounds, down 28 percent from 2005.

The value of the nation's pecan crop exceeded $400 million last year, according to a preliminary USDA estimate. Texas pecans generated more than a quarter of that total, based on an average sale price of $1.70 a pound.

The good news for Texas growers is that pecan quality generally is up and prices have stayed strong. Pape said the difference paid between the bigger, soft-shell nuts and lower-end nuts is wide, but some prices are at an all-time high.

Those prices are what growers count on to cover accelerating production costs, which one grower said were the highest he had ever seen, mainly due to energy costs. The fear is prices could slip as more pecans come on the market.

Darrell Sparks, a University of Georgia professor who has researched pecans for more than 40 years, said pecan farmers generally must make half a crop to get by, and not everyone will make half a crop this year. "You'll need a cushion for off years," Sparks said.

Cameron Ocker, who manages the Bar D River Ranch southeast of San Antonio near Poth, said pecan farmers will probably do better than other South Texas farmers who did not irrigate this year. But in an off year, pecan growers typically just "hang on and survive," he said.

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