“We looked at our sister tree nuts—walnuts, pistachios, and almonds in particular—and we felt that we were very much behind the curb,” Bruce Caris, chairman of the National Pecan Shellers Association, told FoodNavigator-USA.
So around four years ago, nine people from the growing and processing side of the US pecan industry, including Caris, were elected by fellow industry members to brainstorm how the sector could get more funding. Thus the American Pecan Board was formed.
Can pecans be the next hot thing?
Compared to the other tree nuts, Caris said that the pecan industry was more scattered throughout the country, and over the past 20 years marketing and research has been more “everyone kind of doing their own thing.” It’s largely a geographical issue—while an overwhelming majority of domestic pistachios, walnuts, and almonds are grown in California (about 95%, Caris estimated), pecans are grown in 15 different states.
What is a Federal Marketing Order?
“Federal marketing orders (FMOs) are industry-driven programs that help industries leverage their own funds to establish industry standards, develop markets, and address consumer needs,” Carl E. Purvis, Public Affairs Specialist at USDA’s Specialty Crops Program told FoodNavigator-USA.
“Through the Agricultural Marketing Service (AMS), USDA provides oversight to these orders and ensures compliance with all regulatory requirements. Congress enacted the Agricultural Marketing Agreement Act of 1937 to establish FMOs so that agricultural industries could develop broad marketing and industry standards for the benefit of the industry at large.”
When an order is given, here’s what an industry may choose to do:
- Impose mandatory grading and inspection services as a way to keep subgrade product from entering commercial channels;
- Standardize the packaging and labeling of containers to facilitate handling and shipping of a product;
- Conduct production research and market promotion activities; and
- Set volume regulations, which redirect a portion of the crop to storage when supply exceeds anticipated demand, all for the purpose of enhancing market conditions and the marketability of agricultural products
“A FMO is one of the tools USDA uses to help the American agricultural economy,” Purvis said. “They help build vibrant rural communities and secure a stronger future for U.S. agriculture.”
Additionally, pecans take a lot of time to grow. “From the time you put a pecan seed in the ground until you’re getting a crop that would pay for itself is about 12 years, so it’s a very long term capital investment compared to an almond where you’re getting a return in four years,” Caris said.
Hence, average crop size for pecans is relatively not that big—270 million pounds per year in the US for the past five years. For context, the almond crop size has averaged 2 billion pounds per year, and it remains the top specialty crop for export (the US also happens to be the largest producer of almonds).
Hazelnuts and pistachios also have small crop sizes, but pecans are different in that they’re native to the southern United States and northern Mexico. While the US competes with Iran, Turkey and Mediterranean countries for the former two tree nuts, 95% of the world’s pecans are grown in North America (the US with 75% and Mexico with 20%). “A lot of the world doesn’t even know what a pecan is,” Caris claimed.
A trip to The Hill
“In the fall of 2013, the majority of the board members went to Washington and met with USDA to find out what type of programs were available,” Caris said. After reviewing the programs, the council decided they should apply for a FMO. “The main reason for that is that there is a lot of flexibility to how you want to set the program up to be specifically tailored to the needs of an agricultural industry.”
Afterwards, the council visited all its constituents, various pecan associations based on region or function, to collect input on what needs to go into the order. Finally, in January 2015, the council revisited the USDA to present their final application, and after it was reviewed by the USDA, the government agency sent out a grower’s referendum.
“It basically was a ballot put out to all the pecan growers in the United States to vote whether or not we should start to collect an assessment [a levy on pecan growers] each year on the crop, to generate funds for marketing and research efforts, and that referendum passed,” Caris added.
Room for growth in pecan innovation
Can pecans become the next almond, which received its marketing order back in 1950? “I’ve been in the industry for 16 years now—we have a really good message about a good tasting and a healthy nut, but we have not had the ability to have a voice because we’re a small industry, and the thing that excites me the most is the ability to have a voice,” Caris said.
Despite its niche place globally as Caris described, there is growing demand for pecans overseas. “Prior to 2000, China had never imported more than a million pounds of pecans in the shell. Two years ago they bought almost 98 million pounds of in-shell pecans from the US. For this past crop year it would probably be close to 60 million—China alone is buying 20 to 30% of the US crop,” he said. There, Caris explained, consumers like their tree-nuts in shells, because it seems fresher to them.
But beyond being sold plainly as a nut, Caris noted innovation in other applications. “I would say over the past three years we’ve seen several pecan nut butters getting started. I know of two companies who sometime in the next month will launch pecan milk,” he added. “And inclusion in cereals and snack bars have taken off in the past five years, both here as well as in Europe and Asia, Japan in particular.”
There is nut-milk company Malk with its pecan milk, or Neat Foods’ no-soy meat alternative burger made out of garbanzo beans and pecan nuts, as well as fruit-leather chip company Nutty Goodness’ inclusion of pecans in its coffee-flavored chip. Caris hopes that with the FMO, more innovation from manufacturers and more awareness of consumers will come.
Caris said: “Better coordination and a closer cooperation across the pecan industry in our efforts on research and marketing —we have a lot of different grower associations and pecan associations across the country, and everyone has worked hard at doing what they could with their resources, but this is going to be a pooled resource [working] together to have a unified voice, and that will be very, very significant.”