The demand for pecans has been on the rise for the last few years, and this keeps pushing the prices up. Many nut lovers have come to appreciate their benefits.
However, the demand has not translated into increased production. With many people turning to natural foods and nuts, in particular, this has strained nut production.
The price of pecans is determined by the prevailing market forces of supply and demand. When the produced nuts do not satisfy the market needs, prices increase, affecting the supply chain. However, this only partially explains why pecans are so expensive.
Factors Affecting Pecan Prices
As a consumer, you might not know what goes into the planting, maturing, and harvesting of pecan nuts. The entire process is labor-intensive with high overheads. These determine the price of the end product in the market.
With half of the total pecan production based in the U.S., much of it is exported overseas, with China importing the bulk of the produce. The Chinese population is growing as such, the demand for this rare nut does too.
A lot of effort goes into the pecan orchards. From planting to harvesting, with many farmers opting for fast-maturing nuts.
Pecan Demand And Supply Push And Pull
Pecans are seasonal, and the tree takes over 10 years to mature and start producing the prized nuts. Harvesting is sometimes disrupted by the extended wet season, which creates distribution gaps in the market, and causes the price increase.
Many retailers opt to buy the product during bumper harvest and sell when there is scarcity in the market. This makes pecans so expensive. If you want to get cheap pecan nuts, the best time to buy is when the market is saturated.
However, this becomes a demand and supply push and pull scenario prompting the pecan price to skyrocket.
Lack Of Pecan Price Support From The State
Despite their health benefits, pecans prices are not supported by the government. The nuts are classified under luxury products and left to the market forces to determine the price’s direction.
If the price is centrally controlled, the nut price can significantly be lowered.
When the pecan market lacks control, the price is highly dictated by the middlemen. You are left to decide whether to buy the product or not. Given the time it takes to mature a pecan orchard, the farmer has to look for ways to recoup their input in the shortest time possible, explaining partly why pecans are expensive.
Pecan Advertising And Pricing
Pecans are packaged as luxury nuts. You have to pay a premium price to get them from the local store. Pecan advertisements portray the nuts as premium, which has created a route to the market targeting high-end consumers.
Secondly, not every store stocks the nuts; its placement is in outlets frequented by the heavy spender conscious about their health.
In adverts, the pecan nut is presented as a product packed with antioxidant properties. What’s more, it is said to prolong life as well as an Alzheimer disease suppressant.
Pecan Growing Versus Demand
With the numerous health benefits that pecan nuts offer, the demand continues to rise, and so is the price. Pecans are slow growers, and the demand is moving at high speed, which is a natural catalyst to the nut’s pricing.
When pecan growing areas experience drought, the supply drops while demand spikes north taking with it the price.
Farmers opt to grow fast maturing nuts, thus avoiding pecans. This makes consumers rush for the little that is available in stores. On the other hand, pest pressure has always affected both the quality and quantity of pecans produced. This determines how expensive pecans are when they hit the market.
Uncertainty In The Pecan Market
Most of the pecans are grown in the United States and sold in the Chinese market. With the current trade disputes between the two countries, there is a lot of uncertainty in the market. This has been made worse by COVID 19 pandemic, which has disrupted the supply chain pushing the price up.
In 2019 the average price for pecan was $1.29 per lb but the entry of China into the market saw the price climb to $2.17 before trade tariffs where put in place.
With the pandemic, many consumers are not willing to buy due to market uncertainty. This has caused a deficit in the market, making pecans expensive.
As the market remains unregulated, pecans will remain expensive. However, the ripple effect does not stop with the retailer; the farmer also benefits when buying these nuts at a premium price. The price is controlled by the seller in an open market, with the middle class being the target.
Pecans are not among the easiest plants to grow and nature. The time they take to mature and produce makes pecans expensive and restricts the growth of new pecan trees.
As the global population continues to grow, the demand for pecan nuts will keep rising, and so is the price. If production does not satisfy the demand, pecans will remain expensive.
To tame the runaway pecan price, there is a need for a central authority to control or support the price like in the sugar industry. However, growing pecans is labor-intensive, and high overheads are responsible for the price push.
However, increasing the number of pecan orchards is the only way to access less expensive pecan nuts.
If you are looking for the benefits of this type of nuts, you do not have to look at the price tag; focus on the value for your money. Once you take a quick look at what goes into putting the nut on the table, you do not need to ask why pecans are expensive.