May has started off strong as we continue to see a sales increase despite some additional tightening in supply on several varieties and sizes. This has not discouraged buyers who have been flexible of understanding the overall picture of current supply for this time of the season.  Weather has continued to be a surprise with a strong rain storm last weekend and cool weather. This should only add to the plenty of water we already have for the orchards. Up to now, the average temperatures for this time of the year has been about 13 degrees cooler. This changed over the weekend as temperatures rose to the low 90’s, which is more of the norm.  

Last Friday, the USDA NASS released the Subjective Estimate of 3.00 billion pounds. This represents an increase of over 21% greater than last year’s production of between 2.45 to 2.47 billion pounds (once the final receipts are in). This is slightly higher than what the industry had been forecasting of 2.79 to 2.97 billion pounds, but still very much in line with what has been in the back of most minds. The industry will use this number for the next 8 weeks - until the Objective Estimate is released.   

With March shipments at 237 million pounds, down -15.7% from last year and still within industry expectations, shipments are on track to sell through this year’s crop and minimize the carry-out this year to a manageable 550 million pounds estimated. Crop receipts are also topping out now, currently at the 2.437 billion pound mark, and should rise by a few million pounds at this point as stated above. 

Meanwhile, the industry has now shipped 1.838 billion pounds and stands ahead of last year’s shipments by +2.25% YTD. While both domestic shipments, and export shipments were down in March versus the previous year, YTD domestic shipments remain flat to last year and YTD export shipments are up 3.44% to a year ago. April shipments are estimated to continue strong somewhere in the 220 million plus range. This will keep momentum in the growers favor on the current crop, however, with the larger crop coming, pricing should remain stable with an exception to the harder-to-find sizes and grades such as NPX#1 23/25 AOS. 

New sales in March were 181.67 million pounds, up 26.5% versus last year’s sales of 143.60 million pounds. Expect to see this trend continue as growers and processors are looking to book forward now with new crop through Q4 as the “open for business” mentality gains strength. With great growing conditions and plenty of water at hand, it will be important to have a good start to the new crop year.  

Upcoming Industry Milestones:

• Position Report: May 14, 2024
• Objective Estimate: July 10, 2024

Bullish Trends:

• Shipments continue to be strong and remain ahead of last year by 2.25%, overall. Expectations for April shipments are above 220 million pounds, which would be stronger than last year’s shipments.
• The carry-out is on track to be below 550 million pounds. This is much better than we have seen in several years now, and has helped to bring supply in balance with demand. 
• The market remains strong and commitments are growing. While pricing has crept up, it is still a great value over other tree nuts and will remain the consumer’s choice at the shelf. 

Bearish Trends:

• Uncertainty of commitments lends itself to that demand question for the rest of the crop year. The industry will need to pay close attention to the April position report. 
• Demand is still in question for the current crop as diminishing availability of quality and sizing may contribute to wait for the new crop for some.
• With a forecasted 3 billion pounds, and a carry-out of around 550 million pounds, the total production will be very similar to last years totals. Pressure will be on to push for sales, keeping the market in check.