W. B. MARTIN, JR.
General Manager, Sunshine Pecan Company
San Antonio, Texas
WITHOUT IMAGINATION and ideas no one could possibly remain in the pecan business. It is difficult however, to present ideas in sequence of importance. The pecan business, as you know, has more facets to it than a cut diamond. There are no two years exactly alike with regard to harvests or markets. The business is conducted with emotion and feelings or the various operators.
Most people become interested in the pecan by fate or by accident. Thirty-nine years ago, while I was away from my grocery business, my employees purchased considerable tonnage of shelled pecans that came out of old Mexico. With considerable effort, these shelled pecans got sold. I became fascinated with the affair. Ideas came fast. The result was the sale of the grocery store and entry into the pecan business.
From the very beginning the troubles came. It seemed that some individuals, the City Health Department, County, State and Federal Government were singling out the pecan business as a target for destruction.
The unsanitary operating conditions of the time could not be controlled. The hand crack, hand pick did create employment for thousands of otherwise unemployable people. Then, the natural enemies of fluctuating markets, quality inconsistency, transportation difficulties grading and sizing to suit trade requirements, packaging, financing, storing, selling and distribution, all took their toll.
The industry, despite tragedies, complications and problems, is still growing. Yet, I feel that the industry is still in its infancy. Our growth and progress is retarded on many occasions by short crops. We are pushed backward many times by poor markets but we keep trying to grow and improve.
From the hand crack and piece work basis of just a few years ago, we now see processing plants being automated. Higher costs for each phase of operation plus the $1.25 to $1.40 per hour minimum wages are being overcome to some extent whereby processing costs are up only 40 to 50 percent over the cost that we had 30 years ago. All management costs of operation, however, have gone up 100 percent and more clerical, freight and other costs have risen.
Pecan processing equipment has become more costly and sophisticated. The 2 x 4 and screen wire days are just memories. We are growing up slowly in this industry. The trend is forward with progress in most facets. We are going backward, however, in some phases, such as quality. We are standing still marketwise. The pecan market is always a market of expediency. Stability in a pecan market is just a temporary affair. Production has not stabilized; quality has not stabilized.
New Approaches Needed
Over a 30-year period, I see a general deterioration in quality---Why? I still see unstable production. I still see gyrating markets.
Either we improve on our old ways or embark on new approaches to fit in with the forward trends or suffer the same consequence over and over. This applies to every facet of the industry---orchard management, insect control, accumulation, preparations for sales, transportation, etc. where the grower is concerned.
The grower also must be concerned with the processors who play the vital part in marketing. Each facet carries as much importance as the other.
Marketing alone isn't the solution of all problems. It is just the end result in coping with all the other items that lead up to marketing. We can't continue on the basis of expediency alone. Constructive objectives must be researched either one by one or simultaneously.
Some conditions of operation which we can't afford much longer must be clearly defined. Means or procedures must be established to avoid having to suffer through the same on another occasion. The gyrating price and market condition of 1963 through 1966 is what I refer to.
Research in horticulture on the pecan probably will prevent the terrific difference in tonnage production from year to year. Possibly the quality condition might become controlled.
Production must continue to rise to keep up with our ever increasing population. We need not concern ourselves with an oversupply of pecans it we will just bear in mind the things that slow down the consumption. Consumption was allowed to sink to an all-time low before the big 1963 crop hit. Now consumption is up again to an all-time high.
Today we have big corporations diversifying into the pecan world, such as Pet Milk, Standard Brands, Beatrice Foods, Cotton Producers Association and cooperatives, plus some financially strong individuals. This is evidence that the pecan industry is growing up.
Possibly the pecan industry again can enjoy a daily market, year in and year out. The industry had it once in the early 1930’s. We must never again find a condition where no one could sell a pecan at any price anywhere. This comment implies that a remedy can be found in some form.
To reduce the inconsistencies in growing, harvesting and marketing is our objective. We must establish responsibility for what we do. We must convince financial institutions that the pecan is a good risk. To do so we must have a grading system. We must eliminate sharp practices and develop terminology that identifies the kind and class of goods we sell or offer as collateral. Without adequate means to absorb any size crop the entire industry will suffer.
With the tight money supply here in 1966, there is apprehension relative to what kind of market price will develop when the harvest peak arrives. The smaller operators are the ones who help in stabilizing the market. These fellows have been hurt badly during the past 2 years. They can also hurt the market during their financial pinches.
The processing part of the pecan industry will find ways to market all qualities and varieties. This part of the industry, however, will have to recognize the fact that automation by the end user or manufacturer has changed the demand in the nut meat size categories. Varieties and qualities not suitable for the general use and consumer trade can now find a home via proper sizing of the nut meats into uniform particles for the automated manufacturers.
Research is needed regarding the price range that can prevail for any size crop during that particular year of harvest. Keeping in mind what price the grower must have as a fair return and what price must prevail to market that particular crop will solve many marketing problems. Marketing has been disorderly.
The shell that covers the nut meat is only the package. Since the content of the package is what we want and what we market we must realize that the price we pay or receive covers the nut meat only. The more nut meat in the package, the more we should pay and vice versa. Tie this into the quality angle and make price adjustments accordingly.
I believe that the processors should be buying nut meats from the growers and not in-shell pecans per se. The grower delivers the pecan meat in nature's package---the shell.
This leads up wishful thinking as follows:
1. Create markets for in-shell and shelled pecans in every grade that can be identified and established by familiar terminology.
2. Establish a sponsored pecan bank or industry sponsored market for stabilization of supply and the market.
3. Project yearly consumption rates and suggest prices required for orderly marketing of any stated tonnage crop before the harvest begins.
4. Project price differentials between quality nuts and poor quality. This will encourage growers to produce better quality.
5. Research all avenues for disposition of #3 grade pecans whereby this lowest quality can't affect the price market for the #l and #2 grades.
6. Create confidence on the part of the consumer by not permitting him to obtain #2 or #3 grades during the holiday season.
7. Research shelf life of the pecan meat. Educate the user as to conditions under which pecan meats must be kept to avoid letting the consumer get stale or rancid pecan meat. Strive to make a staple item out of the pecan such as beans, flour and salt.
8. Encourage growers to keep up with horticultural practices and to reduce the number of varieties of pecans.
9. Encourage research on all facets of the pecan industry to prevent history from repeating itself with the undesirable conditions.
10. Heretofore, only high price encouraged the grower to produce with the subsequent fall-off in consumer demand. Iron out this problem to arrive at a happy medium.
The industry is undergoing revolutionary changes. We will witness much more progress and suffer or enjoy accordingly the results we create. We can continue to work and act with expediency with our apprehension or wishful thinking or we can change our ways for betterment. The time has come when more people must contribute something tangible to the industry. Taking from the industry and giving nothing in return is fighting a rear guard action.