Nuts

Market Insights


October 13, 2023

Almond

Our California weather has continued to be an issue throughout this crop year, from the start of the bloom in February through the growing period, and now harvest. The cooler temperatures, along with rain, have delayed the crop and will undoubtedly have an impact on the crop when all is said and done. There are many frustrated customers out there that continue to try to get their loads delivered or covered. This situation will resolve itself in the weeks ahead as crop receipts start to ramp up, as you will note below.  On that note, the Almond Board of CA released the September Position Report on Thursday, October 12, 2023, and we saw crop receipts seemingly explode overnight from the August position report of 70 million pounds to 625 million now received YTD. While still behind the 978 million received at this point last year, this trend will continue to build through the rest of the year and into the first quarter of 2024. As receipts continue to grow in October, growers and processors will finally have a chance to better assess the quality and yields from the orchards. This should bring more offers to the market in the weeks ahead.

September shipments were strong, with 217.7 million pounds shipped for the second month of the new crop year. This is an increase of 15.6% over last year and represents the third strongest September historically. As a result, the new crop year is now ahead of last year by +3%. Both export and domestic shipments were up compared to last September. Export shipments reached 154.8 million pounds, up 13.3% from last year’s 136.6 million pounds. Domestic shipments also rebounded, with 62.8 million pounds shipped last month, putting domestic shipments in the positive territory for the first time in over a year, +6% YTD. This also represents the third largest September for domestic historically

Upcoming Industry Milestones

  • Harvest Period: Harvest will quickly becoming to a close as growers work to harvest the remaining late varieties and get it to the huller / shellers.   Within the next two weeks there should be nothing remaining on the ground.  
  • Position Report: November 10, 2023

Despite the lack of new crop offers (due to the late crop and growing concerns for yield and insect damage), new sales for September remained robust, with 269.9 million pounds sold. This represents an increase of over 11% compared to last September when 240 million pounds were sold. This is a very positive trend and may lead to stronger shipments in the months immediately following. It has certainly taken a big bite out of the carry-out. The lateness of the new crop, which can be seen as a blessing in disguise, is attributable to the timely shipments of the carry-out supply from the previous crop. This has positioned the industry well for setting up new crop sales going forward.

Overall commitments have improved slightly from a year ago, with 674 million pounds now on the books compared to 666 million last year at this time. This is primarily driven by export sales, with commitments of 414 million pounds, up 26.4% versus 327.5 million last year, while domestic coverage lagging behind at 260 million pounds, compared last year's levels of 338.4 million, a decrease of 23%.

Almond Market Insights - Week 41 Update

Bullish Trends

  • New sales for September were very strong, with 270 million pounds added, which represents an 11% increase YoY. This increase should translate into strong shipments throughout the fourth quarter of 2023.
  • With crop receipts delayed, the industry has been presented with an excellent opportunity to reduce the 800 million pounds of carry-in. Since the August shipments of 212 million pounds and the September shipments of 217 million pounds, a significant portion of the previous crop has been depleted. The new sales reported in the last two months will also have contributed significantly to reducing the remaining stocks.
  • While the market has certainly firmed up in the last two weeks, pricing remains attractive for buyers, and the combination of this firmness along with strong shipments instills confidence in the almond market for everyone.

Bearish Trends

  • Consumption is still on everyone's minds as demand remains uncertain. Market levels should not be an issue; rather, the strategic question is trying to understand where the demand will come from and whether it will increase in the months ahead.
  • This is especially true for the domestic market, which is the single largest market for almonds worldwide. While September was a great shipping month, concerns arise about future performance lagging behind last year, which was not a stellar year, finishing 6% lower than the previous year. Without a cohesive plan to address the month-over-month decline in sales, the industry will continue to face its challenges.
  • If California doesn’t continue to sell into this market, it could start to lose ground on commitments in the coming months. 
© 2024 Olam International All Rights Reserved Co. Reg. No. 199504676H