Our sales come from selling shelled pecans through food brokers; although, a few long-established house accounts are maintained.
Approximately 70% of our product goes to the baking industry. The remaining 30% is divided between ice cream manufacturers, candy manufacturers, nut salters, and cellophane sales for the supermarket trade.
The new crop arrives November 1, which is also during the period of great seasonal demand. Due to the great demand for pecans at Thanksgiving and Christmas time, we are unable to harvest the crop fast enough to meet this demand, regardless of crop size. However, during December we begin to catch up with the demand, our inventories become established, and we are in a position to contract.
Samples are readily available; however, it is a general practice to send each broker a complete set of samples about November 1. Remember, samples are perishable- use fresh samples.
Re: New Customers - For credit information we are guided by Dun and Bradstreet, until credit is established.
Re: Orders for new crop. A new crop price list is issued about October 15; however, most brokers send in orders earlier. These orders are marked S.A.P. (Subject Approval of Price) because new crop is shipped on a first come - first served basis. All the S.A.P. customers will he notified as to price before shipment is made and they have a choice: ship or cancel.
Re: Freight cost- All shipments are F.O.B. Orangeburg, S.C. - Delivered prices are available upon request.
Why contract? The contract offers several advantages to both the buyer and the seller.
1. The contract establishes a fixed source of supply for the customer at a fixed price.
2. Through the years contracts have proven to be a good buy because as the crop goes into consumption there is less product available which causes the spot market to advance.
3. Some shellers sell their entire output of certain sizes and grades to large users. Suddenly, the supply of the particular sizes and grades is exhausted- thus an early contract assures the buyer of delivery during the entire year. Through the years we have found that the best time for the buyer to contract is during the first two weeks of December.
Our contracts carry a 2 cents to 5 cents per pound per month carrying charge (according to interest rates). This charge covers freezer storage cost and bank financing.
Contracts expire October 1. This is because the new crop pecans, which start coming in during October and are usually ready for shipment by November 1, will have a different price structure caused by the varying crop sizes.
Contracts originate in the office of the Orangeburg Pecan Company, Inc. The broker advises by telephone or mail how many pounds the customer wishes to contract. The contract is then typed and signed by the Orangeburg Pecan Company, Inc. (3 copies). These copies are then forwarded to the broker who has the buyer sign all 3 copies. The buyer keeps a copy, the broker keeps a copy, and the remaining copy is returned to the Orangeburg Pecan Company, Inc.
Contracts are advantageous to the seller because he can shell the product, store it in a freezer, and not worry about future sales on that item.
How do we derive prices on shelled pecans? The size and quality of the crop for that particular year is the most important factor in the pricing of the product. A large crop of 300 million pounds or more would depress prices and a short crop can cause prices to skyrocket.
Some people think we have a big crop one year and a short crop the following year. There is really no basis for this thinking, but it has followed this cyclic pattern for many years. The USDA government estimate on the coming crop is published on September 15 and the information is promptly forwarded to all brokers.
As in all cases, the rule of supply and demand is a big factor- as a sheller sells out his inventories it is only natural that the remainder of the product advance in price.
A good example of how prices might advance is a short crop following a large crop. If, we learn on September 15 that the crop is 100 million pounds (estimate) as compared to a crop the year before of 300 million pounds, then prices are likely to advance rapidly.
Pecan Halves are available in various sizes. This is referred to by numbers immediately following the word "halves". These numbers refer to the count of halves per pound such as:
|Jr. Mammoth Halves||250-300|
What is the difference between Stuart Halves and Seedling Halves?
The Stuart Halves come from large papershell nuts of which we have many in the Carolinas and Georgia. These Stuart Halves are the Mammoth and Jr. Mammoth Halves.
The Seedling Pecan is a much smaller nut and thus produces smaller halves. The Seedlings were originally known as "wild nuts" or "uncultivated" pecans. They have a hard shell and are grown over the entire Pecan Belt. Therefore, the Stuart Pecans produce the larger halves and the Seedling Pecans produce the smaller halves.
The broken pieces that come from the shelling operation are labeled as follows:
The broken pecans are screened to produce a uniform size whether they come from Stuart or Seedling Pecans.
Each size of halves and pieces are available in 3 quality grades:
More on this on the following page under information of the Fancy, Choice and Standard grades.
GRADES - FANCY, CHOICE & STANDARD
The words Fancy, Choice and Standard precede the words Halves or Pieces. They designate the quality of the product.
1. Fancy is our best grade.
2. Choice is our 2nd best grade. A little off in color, but used by many bakeries and ice cream manufacturers in their products. Usually the Choice pecans are priced about 25 cents per pound less than the Fancy.
3. Standard is our 3rd best grade. Standard kernels are dark brown in color and are the lowest grade we make. Some bakeries, candy manufacturers and ice cream producers use this grade because they can usually save about 5O cents per pound. We do not, recommend Standard pecans for outside use on any product.
Each price list published will have Fancy Halves and Pieces at a price, Choice Halves and Pieces at a price and Standard Halves and Pieces at a price.
Toasted Pecans for ice cream can he any of the above grades.
HANDLING AND STORAGE
The pecans (in shell) arrive at our plant either in burlap bags or in wooden tote bins. Upon arrival a decision is made as to whether they go to the shelling plant or to the freezer as we are both shelling and storing pecans from November to March. When the pecans get out of season we then go to the cold storage to get pecans for the shelling plant. The shelled pecans are put in a freezer and held until shipment.
Pecans are highly perishable (especially in hot. weather) and if not kept under proper refrigeration will spoil rapidly. Our suggestion to the customer is to keel) them in a freezer or cooler from late Spring until the Fall. During the Fall and Winter this is not a problem because the weather is cool enough to hold the product as is.
Shelled pecans can be frozen, thawed out. and frozen again. This does not hurt the quality. Thus a truckline shipment from Orangeburg to New York would not have to go on a refrigerated truck, hut should be placed on cold storage upon arrival.
Bulk shipments are made primarily in 30 lb. boxes- Toasted pecans for the ice cream trade are also packed in 30 lb. boxes.
We also pack a 60 lb. master carton which contains 12/5 lb. cartons. This carton is also described as Bulk Shipment and is primarily used for the institutional trade or for any buyer who wants a smaller pack.
The demand for shelled pecans in cellophane bags increases each year. We have recently installed additional packaging machinery so shipments can he made promptly.
The 1 lb. and 1/2 lb. seem to he the most popular packs; however, due to the special pricing of some supermarkets we have added a 12 oz. pack.
We usually wait until we have a firm order before packing cellophane. This enables us to pack fresh pecans for the customer.
|1 lb. Cello Bags||Packed 1 dozen per case|
|12 oz. Cello Bags||Packed 2 dozen per case|
|1/2 lb. Cello Bags||Packed 2 dozen per case|