South Africa records record monthly pecan exports, macadamias bounce back
South Africa is the third-largest exporter of pecans, behind Mexico and the USA. South Africa exports around 90% of its pecan crop, with nearly all of it going to China (95% in 2020). Exports for 2020 were an incredible 19,945 MT, bringing in more than USD 90 million in foreign currency.
Production has been on the increase over the last two decades, but the 2021 crop suffered as a result of extremely cold weather during flowering. This resulted in a drop in production of 22%. According to the International Nut and Dried Fruit Council (INC) estimate, the crop will be 16,650 MT (in-shell basis).
Source: South African Pecan Nut Producers Association, INC, ITC Trade Map
Macadamia production keeps expanding in South Africa and the crop is estimated at 17,600 MT in 2021 (shelled basis) according to Macadamias South African NPC (SAMAC). South Africa exports roughly 70% of its macadamia crop, most of it going to the US, China, and Hong Kong.
Source: SAMAC, INC, ITC Trade Map
Logistic bottlenecks and social unrest hampered exports earlier in the season
South African harbors are notoriously inefficient and with the global shortage of containers, and skyrocketing freight prices, this problem was compounded. Add to that the social unrests in July which severed transport arteries in the east of the country, and exports of pecans were off to a slow start, and macadamia exports slumped mid-season. Especially macadamias suffered the brunt of these events, as exports tumbled to only 3,464 MT in July, compared to the 5-year average for this month of 7,028 MT (in-shell basis). Pecans exports were below the 5-year average until August, but were less affected because the export season starts later and pecan production is located farther away from where the protests were centered.
Record monthly pecan exports
South African pecans exports follow a well-defined trend, with steady demand from China giving certainty to the market. Virtually all exports take place between June and November, when these nuts are harvested. Local consumption in South Africa is comparatively low, at only around 1,500 - 2,000 MT (in-shell basis) and suppliers are not worried about keeping large inventories at the end of the season. This means that as the crop gets harvested, it gets exported. Given the massive exports in September and lower production, exports will most likely have dropped in October and inventories will already be nearly depleted.
2021 has been marked by an incredible demand for nearly all commodities and nuts are no exception. Should demand from China remain strong, they will have to look to Mexico or the US when South African pecans run out. A large crop in the US and big carry-over from last season have kept prices in check.
Source: ITC Trade Map
*HS Code 080290 Nuts, fresh or dried, whether or not shelled or peeled (excluding coconuts, Brazil nuts, cashew nuts, almonds, hazelnuts, filberts, walnuts, chestnuts, pistachios, macadamia nuts, kola nuts and areca nuts). Pecan Nuts are not reported separately. From South Africa, virtually all nuts exported in HS code 080290 are pecans.
Macadamia exports rebound
After slumping to a five-year low in July, exports rebounded to the highest number on record for the month of September. This is however a knee-jerk reaction to the poor exports in July, and because exports are normally already on the decline in September. Exports were 2,982 MT in September (converted to a shelled basis).
Source: ITC Trade Map, SARS
The Future of Pecans and Macadamias in South Africa
The area under pecan trees in South Africa is rapidly expanding and more than 500,000 trees have been planted each year for the last three years. Macadamia production is also on the increase. 5,351 ha under macadamia trees were planted last year and 5,962 ha in 2019. This brings the total area under macadamia trees to more than 50,000 ha. Both Pecan and Macadamia trees are long-term investments and while small yields can be expected after 5 - 7 years, it takes around 12 years for these trees to reach target yields. This means that both pecan and macadamia production in South Africa will be increasing for at least the next 12 years.
Source: SAPPA
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