Pecan Research and Promotion Program Approved by USDA
The new pecan research and promotion program will have the authority to collect assessments on foreign grown pecans imported into the United States.
According to the final rule published in the Federal Register, “the purpose of the program is to strengthen the position of pecans in the marketplace, maintain and expand markets for pecans, and develop new uses for pecans.”
This new program will assess both domestic and imported pecans to increase monies available for pecan research and promotion efforts. Under the R&P program, the FMO assessment rate for pecans grown in the U.S. would not increase, and the only new funds would come from imported pecans. Those already paying an assessment to the American Pecan Council will not be required to pay any more assessment. The American Pecan Promotion Board will begin collecting assessments on Oct. 1, 2021.
The American Pecan Promotion Board comes as a result of industry-wide support and efforts. With uncertainties in the market, pecan industry representatives have continued to look for ways to establish another effort to further support marketing activities for pecans.
“Research and experience of dozens of crops as well as our own have shown that an important tool to increase crop prices by correcting future supply/demand imbalances is to promote pecans aggressively in major consumer markets, primarily the United States,” the National Pecan Federation stated in a letter to the industry last spring. “We believe we can grow the demand for pecans with more research and promotion money.”
With this in mind, industry representatives and the National Pecan Federation sought methods to raise more funds for marketing programs in the United States. One way was to assess foreign grown pecans imported into the United States; the American Pecan Council legally cannot collect assessments for these foreign grown pecans imported into the U.S.
Seeing one potential path, the National Pecan Federation began discussions with the USDA and petitioned to create a pecan research and promotion program. The U.S. Federal Register published the official proposal for the Pecan Research and Promotion Board at the end of September and opened it up for comments from the industry, individuals, and other interested parties. That comment period ended Nov. 23, 2020, and the proposal was then reviewed again by USDA. The final rule was published on Jan. 13, 2021, and can be accessed in the Federal Register.
Unlike the APC, the American Pecan Promotion Board (APPB) has the authority to assess both pecans grown in the U.S. and foreign grown pecans imported into the country. At current import levels, the National Pecan Federation estimates that the assessments collected by the R&P program would nearly double the amount of money for research and promotion, or bring in an additional $4 to $6 million per year. This new money for research and promotion will be critical to the success of increasing demand to meet future supply.
The initial Board for the APPB will consist of both U.S. producers (growers) and importers (importers will include U.S. based shellers/importers as well as foreign-based importers). The Secretary of Agriculture will select the U.S. producer board members and the importer board members from a list of prospective members given to the USDA by the APC. The USDA AMS announced on Feb. 12, 2021, that it was seeking nominations for the APPB, as well as nominee requirements. All nominations must be received by March 26, 2021.
The order requires that all domestic nominees come through the APC. The USDA previously tasked the APC with submitting a list of prospective members on Jan. 13, 2021. The list was made up of names passed along by state associations.
Similar to the Federal Marketing Order, this pecan research and promotion program is subject to a referendum among producers and importers to “determine if pecan producers and importers favor the continuation of the program three years after the collection of assessment begins.” In other words, come 2024, industry members will have a chance to vote to continue or end the APPB.
The creators and proponents for the APPB see an opportunity within this program. With the potential to collect an additional $4 to $6 million for promotion activities, the American Pecan Promotion Board (APPB) may provide additional support to marketing efforts, as well as create new ones to promote its healthy, tasty product.