Almond Market Report

California weather is making it a wet January! Thus far, we have seen both rainfall and snowfall improving in January following a dry November and December. This is a welcome sight considering the snowpack is currently at 53% to normal (a ten-year low) with rainfall to date at 42% to normal. We are expecting another storm this weekend, which should bring a fair amount of moisture with it.   

The Almond Board of California released the "December Position Report" on Thursday, January 11, 2024. A standout of 361 million pounds were received in December versus 226 million last December, an increase of 60% over a year ago. Hullers/Shellers worked feverishly to finish their jobs and close down for the season following the late crop. While there may be some stragglers out there, for the most part, the shelling season is complete. Crop receipts to date stand at 2.23 billion pounds, down 6.2% to last year and it's looking more like a 2.4 billion pound crop now rather than the 2.6 billion pounds that was forecasted. This is good for the industry that has been fighting an over-supply for the last three seasons. All eyes now will be focused on the February bloom, just 4 weeks out. 

Shipments for December were a strong 229.4 million pounds meeting industry expectations. This is 11.2% ahead of last December and brings YTD shipments to 1.145 billion pounds and almost 10% ahead of last year at this time. This is a composite of the following:

Domestic shipments were at 56.68 million pounds, up 8% versus last year’s 52.47 million pounds. This positive number for the domestic market brings total shipments flat to last year (+0.52%). 

Export shipments were at 172.72 million pounds, which is 12.2% up versus last year’s 153.88 million pounds. Export shipments have improved month over month for the fourth straight month and represents the second-strongest January in history. We can see China/HK/Vietnam with a sizable increase, up 391% FTM and 21% YTD, in anticipation of CNY next month. All key destinations stay ahead YTD. Total exports are up 13.59% YTD. 

Sales & Commitments: Total sales for the month were 219.42 million pounds, down 7% versus last year’s sales of 234.91 million pounds. Lower sales in December may be attributed to recent increased bullishness of sellers, and a lack of willingness to offer out for further periods. 

Commitments for the new crop year stand at 637.43 million pounds, which is down 11% versus the 719.71 million pounds from last year. As long as California continues to produce strong shipment months, the commitment number will continue to remain short of last year. 

Uncommitted inventory currently sits at 1.20 billion pounds, down 14.4% versus last year’s 1.40 billion pounds. This number continues to move upward due to the late harvest, delaying receipts by around one month. 

Despite the lack of offers, the 219 million pounds of new business may be more in line with what the 2023/24 crop year supply will be. While new crop offers remain available for close-by shipments for the first quarter, sellers have yet to open up to selling too much further out and waiting to see what bloom weather will be like. In the meantime, plenty of winter sanitation is taking place as we prepare for the very important upcoming bloom.

Upcoming Industry Milestones

• Position Report: February 9, 2024

Bullish Trends

• Four straight months of strong shipments have put the industry ahead of last year by almost 10%. This week’s shipment report remains in favor of the industry. 
• With crop receipts signaling a third year of decreased production from the orchards, this has helped to firm almond prices and bring supply back into balance with demand.  
• Shipments remain ahead of last year not only from a global perspective, but even domestic shipments are showing life! Demand remains strong as consumption continues to trend positively, supporting a firming market for the foreseeable future.

Bearish Trends

• Weaker sales in December may turn out to slow the shipping trend the industry has seen in the fourth quarter of 2023 in the months ahead. Much of that business was done at lower levels as we see the market firming and less business is also being generated.   
• Sizing options this season remain a problem for the industry. This may also contribute to less activity as end users find it difficult to incorporate larger sizing into their product mix. Expect to see less larger almonds used to replace the smaller and "harder to find" almonds. This would then lead to less overall demand domestically. 
• Shipping issues due to the unrest in the Middle East have escalated and are causing not only delays with shipping routes being completely disrupted, but costing has continued to escalate. With even more unrest breaking out this week in Yemen, oil prices have now jumped 4% overnight.