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Changing tastes: NMSU researchers study the market for new pecan products

They taste good, they're good for you, and a market for them already exists. But don't expect these specially produced products to be on your average grocery store shelves anytime soon.

Bill Gorman stands over a sitting Skyla Cockerham as she pours out some pecan oil.
William Gorman, left, professor emeritus in the Department of Agricultural Economics and Agricultural Business, and research assistant Skyla Cockerham, display pecan oil and pecan flour samples related to their research on pecan oil extraction and marketing. (Photo by Darren Phillips)

New Mexico State University researchers recently examined the feasibility of locating and operating a 2-million-pound pecan processing facility in southern New Mexico that would produce high-grade pecan oil and de-fatted gluten-free pecan flour. The oil and flour would be derived from the pecans using a new extraction process developed by Oklahoma State University and Ambient Temperature Extraction Partners of Oklahoma. No large processing facility using the OSU method exists anywhere outside of a university lab.

William Gorman, a professor emeritus in NMSU's College of Agricultural, Consumer and Environmental Sciences, and his team of researchers, including graduate research assistant Skyla Cockerham and Jay Lillywhite, professor of agricultural economics and agricultural business, see great potential for such a processing facility in pecan-rich southern New Mexico.

"We did a lot of research and there are several methods of getting pecan oil, but the most common one is using a screw-type press to squeeze out the oil," Gorman said. "When you're through, besides the oil, you have a meal that still has about 20 percent fat in it and it's not shelf-stable."

The OSU process uses propane and leaves behind oil that does not have to be filtered and de-fatted flour that won't turn rancid. With cooperation from Stahmann Farms, Gorman and his team shipped out pieces of New Mexico pecans to OSU for processing.

"We ended up with two very nice products," Gorman said.

After OSU returned the processed pecan oil and flour to NMSU, the consumer testing began.

"We had really great responses from all of the consumer and marketing research that we did," Cockerham said. "We did several taste tests at 100 West Cafe on the NMSU campus. We also did taste tests at a few retail-distributing companies to see how they thought the product would work in their settings, and the response was very good. A lot of times people's responses were, 'Where can we buy it? Can we get it right now?' It's not being produced commercially, so what we had was just a test product."

Taste testers first compared the pecan oil to olive oil by dipping pieces of bread into the liquid. Then they were given salad dressings made from the two oils. For the flour, the taste testers ate cookies and breads made from the product. The tasters also compared oil and flour made from roasted and non-roasted pecans.

According to the study, of the 41 people who participated in the blind taste test, 31 favored the pecan oil over the olive oil.

"A lot of the taste testers said the oil had a really nutty flavor, a distinct pecan flavor," Cockerham said. "Pecan oil made from the screw-press method doesn't have that flavor because the process requires extensive filtering, which takes out the taste."

Consumers also reacted favorably to the health benefits of the pecan oil and flour. The oil produced with the OSU method is low in saturated fats and high in heart-healthy unsaturated fatty acids. The flour is gluten free. The NMSU study found that once the participants in the taste test were told of the pecan oil's nutritional values, eight out of 10 people who had previously chosen the olive oil changed their preference to the pecan oil. Ten of the 41 participants ate gluten-free foods and found the pecan flour products to be tasty.

"They said the consistency was like normal wheat bread and that it also had a better flavor than any gluten-free bread they normally eat," Cockerham said.

The researchers acknowledge that there could be a bias among the taste testers because they all hail from New Mexico and are familiar with pecans as a cash crop. Still, the researchers believe the results strongly indicate large consumer interest in pecan oil and flour made with New Mexico pecans using the OSU process. The target retailers would be health food stores and gourmet food outlets.

"We found the market for these products to be quite good," Gorman said. "We interviewed a lot of people. However, you can't buy the pecan oil and flour that uses the OSU method right now because no one is producing it. You can buy pecan oil and flour, but they're not the same quality or grade."

So this points to a huge market opportunity for New Mexico's pecan growers and processors, right? Yes, but not for the foreseeable future.

A facility processing 2 million pounds of pecans into oil and flour would generate total sales of about $9 million in its first year, according to the NMSU study. That number would rise to $15.5 million in the second year of operation. However, to get such a facility up and running would take an initial investment of more than $9 million, Gorman said.

With big bucks virtually falling from pecan trees right now, growers and producers are in no hurry to venture into new markets.

"We are trying to give the producers the means of creating a value-added product for their pecans," Cockerham said. "Right now, the pecan prices are so high that there is really no use in a lot of the producers looking at making the oil and flour, because they are getting a great price for the basic commodity. The China market is huge and it buys the pecans in the shell, so it's minimal processing for the producer right now. That's a really hard thing to overcome."

When the NMSU researchers first began their study, Gorman said a pound of pecan pieces was selling for about $3. When the study was finished a few months later, the price was moving toward $5 per pound. The price for whole halves is even higher, peaking at more than $6.50.

"The pecan producers were very interested in the new process, but it wasn't something they wanted to move forward with just yet, because they're getting such good prices right now," Cockerham said.

Gorman added that while the price of pecans has eased a bit, it's not enough to make a pecan oil and flour processing plant economically feasible. So for the time being, Gorman and his team are keeping their study in their back pockets for the inevitable day when pecan prices fall from the stratosphere.

"As China decides how much it's willing to pay for nuts ? plus everybody is planting pecan trees around the world, particularly in Mexico ? I expect the price to come down some and stabilize," Gorman said. "Then I think the pecan oil and flour would be a very good value-added business for some of the processers and shellers."

Until then, consumers will have to make due with the pecan oils and meals currently on the market.

"You can't buy our product yet ? unless you have $10,000, then I'll sell you a small bottle of what we have left," Gorman said with a laugh.