February has turned out to be a very wet month for California. In fact, it is the 10th wettest since record keeping began 128 years ago. This puts rainfall at 106% to the historic average. New water allocations were announced last week, giving farmers throughout the state an additional 5% of increase. This is likely to increase again given this allocation review was based on the reservoir levels a few weeks back. All of California's reservoirs are well ahead of their capacity levels for this time of the year. Meanwhile, the almond bloom has started, we will have a respite from the rain with a 60% chance of precipitation on Monday, then another break for the next five days. These breaks should allow the bloom to progress and for the bees to do their work pollinating the flowers as they present themselves. There are no freezes currently forecasted for the next ten days within the growing region.    

If you missed it, the Almond Board of California released the "January Position Report" on February 9th. January shipments set a record for the month at 235.92 million pounds up 2.7%. Crop receipts also rose by 163 million pounds with 2.39 billion pounds now received, yet down 3.39% from a year ago. This indicates a crop size slightly above 2.4 billion pounds, however off from the 2.58 billion pounds received last year and the 2.6 billion pound estimate. This is the third year in a row of declining almond production in California. To date, the industry has shipped 1.38 billion pounds and stands ahead of last year’s shipments year to date +8.58%.  

Domestic shipments were 62.89 million pounds, down 5.4% versus last year’s 66.50 million pounds. Domestic shipments remain slightly down versus last year’s crop, being down .57% year-over-year. However, January has been the largest shipment number for the domestic market so far during the 23/24 crop year. The industry will work to build on this for the second half of the crop year. Export shipments were 173.03 million pounds, which is 6.1% up versus last year’s 163.16 million pounds. This shipment number was a record for January. Export shipments continue to outpace the last crop year and now sit at 12.24% up year-to-date. 

Meanwhile, sales & commitments reflect a market taking a measured approach. Total sales for the month were 235.91 million pounds, up 14%% versus last year’s sales of 207.64 million pounds. The California Almond Industry has continued to sell even as prices have moved upward over the last 2 months. Overall, this has helped keep shipment numbers higher than the previous crop year. Even with the bloom, the almond industry has continued to sell and we do not see this sales number dropping off in the coming months.

Commitments for the new crop year stand at 637.42 million pounds, which is down 24.1% versus the 840.17 million pounds from last year. Commitments for the 2023 crop year have stayed relatively consistent as California continues to only offer for nearby shipment months. We have seen them as low as 621 million pounds and as high as 677 million pounds. Even with consistently high sales over the crop year, we don’t expect commitments to improve from this range due to California's selling strategy. Uncommitted inventory currently sits at 1.126 billion pounds, down 2.2% versus last year’s 1.151 billion pounds. Uncommitted inventory remains slightly down to last year, while buyers and sellers have 200 million pounds less bought/sold versus this time last year.  

Upcoming Industry Milestones

• Position Report: March 12, 2024

Bullish Trends:

• Strong shipments continue while the industry studies the bloom. No one seems too anxious to sell too far out. 
• Export shipments remain the bright spot as the industry has shipped over a billion pounds and is ahead of last year 12.24%.
• With crop yields down three consecutive years, this has led to pricing pressure as demand is now more in line with the current supply.  

Bearish Trends:

• With commitments well behind a year ago, this will keep a ceiling on the market levels from rising. 
• Receipts continue to come in and have exceeded many expectations. While it may fall short of last year’s crop, it could end up higher than once believed.   
• Weather is lining up to be good for the bloom despite the rains. Temperatures in between rains are well above 55 degrees, which will allow for bee flight while bloom presents itself.