A rare collision of ill-timed rain, marauding animals and a growing love affair between the Chinese middle

Fantastic news! We've Found the answer you've been seeking!

Question:

A rare collision of ill-timed rain, marauding animals and a growing love affair between the Chinese middle class and the pecan has resulted in the worst pecan supply in recent memory. As a result, grocery store prices are up by about 30 percent, which is causing Thanksgiving bakers to think twice about their menus. “It’s like the world doesn’t want us to make pralines,” said Anna Butler, 24, a Texas native who lives on the Lower East Side of Manhattan. Ms. Butler has a ticket home to Texas for the holiday, so she and her New York friends celebrated an early Thanksgiving last weekend. She had planned to show off her Texan roots with a black-bottom pecan pie. But at her favorite Manhattan market, a pound of shelled pecans cost $15.99. “That’s a real investment in a pie right there,” she said. She brought a dish of cauliflower, macaroni and cheese instead. In 2012, the nation’s pecan orchards produced about 302 million pounds of pecans. This year, that number could drop by as much as 35 percent, according to industry officials. In Georgia, the nation’s leading pecan-producing state, the crop is expected to be about half of what it was last year. In South Carolina, some orchards succumbed completely. The problem began with record rainfall last spring and summer. Pollination became difficult, and the moisture encouraged disease. Pecan growers sprayed their fields in record amounts, but it was not enough to fight off a disease called scab. The bad nut crop has a few other causes, one of which is the cyclical nature of pecans: Typically, if one year is good, the next year is not. Then there is China. In the mid-2000s, the market for pecans in China began to grow rapidly. China now consumes more than a third of the American pecan crop, a development that followed the country’s inclusion in the World Trade Organization in 2001. “Before that, they didn’t know what a pecan was,” said Randy Hudson, the owner of Hudson Pecan Company here in Ocilla and a vice president of the National Pecan Growers Council. In street stalls and grocery stores in Beijing, seasoned American pecans in the shell — called “bi gen guo” because “bi gen” is supposed to sound similar to “pecan” — were recently selling for $7.45 a pound. Chinese shoppers prefer big varieties with thin shells, with names like Desirables and Stuarts. Adapted from NY Times (November 2013) Based on Extract 2, explain the impact on the market for pecans (i.e. demand curve, supply curve, equilibrium price and equilibrium quantity).