Despite a number of issues disrupting the economic flow of pecan nuts in 2022, the demand for the nuts remained good, making it an excellent year for producers.
Apart from the prolonged strict Covid-19 restrictions in China, a late season put pressure on South African processors to export the nuts before the Chinese New Year. Despite this, the good demand for pecan nuts and the fact that South Africa had a record harvest of 31 867 tonnes of pecan nuts with prices averaging R70/kg made sure that 2022 was still a successful year for producers. It was an “on” year, however, and therefore the quality of the nuts was not as good as in 2021.
Bester Fruit and Nuts (BFN) specialises in the purchasing, processing and marketing of pecan nuts. The company is continuously working to gain new markets. BFN buys nuts based on realisation, which means that the value assessment of the product is done per crate and the producer thus receives the correct compensation for his nuts. BFN also provides opportunities for producers to hedge the price of their nuts against the dollar and the markets have already provided several opportunities to hedge at much better levels than in 2022.
BFN is a co-owner of the Vaalharts Pecan Plant, a processing plant in Hartswater where 5 225 tonnes of pecan nuts were processed in their shells last year – double the amount of the previous year.
Because consumers’ buying habits are changing and greater emphasis is being placed on the traceability of products, BFN implemented a barcode system in 2022. BFN can therefore follow the product from the scale until it reaches its final destination. This way the company can ensure that it knows where in the world which producer’s product is at all times.
The Chinese market
Most of the South African pecan nut crop is bought by China. The Chinese demand for pecan nuts is between 35 000–45 000 tonnes per year, and it is continually growing.
In the past, pecan nuts were seen as a niche market product in China and formed part of gift packages to family and friends during the Chinese New Year celebrations. The market has undergone a lot of product development in the last three years, and there is now a clear move towards the in-shell consumption of flavoured and roasted nuts. One of the newer products includes milk tea, which is sold in coffee shops such as Starbucks, with small pecan pieces sprinkled over the tea.
This shift in consumer habits will ensure that the product remains in demand throughout the year. As the Chinese market continues to develop, consumers’ preferences for the type of product they prefer are also changing. BFN has already observed the increasing move towards 100% cultivar-genuine products in the last four years and that Chinese consumers have developed an aversion to mixed nuts.
The outlook for 2023
The Chinese demand for pecan nuts is high and with the country’s strict governmental Covid-19 policy having been lifted, the flow of products in China will return to normal this year. This year’s harvest estimate according to the South African Pecan Nut Producers Association is 25 500–28 000 tonnes, and with a market share of 16,5%, BFN aims to purchase at least 400 tonnes.
The prices of pecan nuts remain the most stable of all the nuts, but BFN does predict that the dollar prices will be slightly lower than in 2022. However, the nut size and filling will be much better than in 2022. The better-quality nuts together with the favourable exchange rate that is already hedged will ensure that producers receive better average rand prices for export nuts this year. With the market still evolving, the future of the pecan industry is looking bright. BFN is excited about the 2023 crop and is determined to provide its customers with the highest quality pecan nuts and the best traceability.
ENQUIRIES: Hendri Oosthuizen, Director of Bester Fruit & Nuts. Web: www.bester.co.za