Nuts

Market Insights


September 15, 2023

Almond

Weather remains favorable for the almond harvest to continue in full swing. Temperatures have been in the low 60s in the morning hours, rising the low to mid-90’s in the evening. Growers are busy sweeping the earlier shakes from a week ago, followed by shaking the varieties still on the trees. This process is going to last well into October due to the late crop this year. This is one of the latest, if not the latest, crops we can recall. Good timing, though, as it has helped to sell off the 800 million-pound-carry-in from the previous crop. 

The Almond Board of CA released the August Position Report on Tuesday, September 12, 2023. This represents the first report of the new crop year. Due to the lateness of this crop, crop receipts are well behind this time last year. For the month of August, only 70 million pounds were received, this is over 73% less than last year when 264 million pounds had been harvested and received by handlers at end of August. This demonstrates just how late the crop truly is. Expect to see receipts continue to lag well into November and December, if not further. 

Shipments for August were in line with industry projections with 212 million pounds. While this is a 7.14% decrease versus last year’s 228 million pounds, it is still the second strongest shipment for August in history. Considering the low crop receipts for the month, one can gather a very high percentage of these shipments came from the previous crop. This may continue to be the case for September as well. Both export and domestic shipments were down compared to last August. Export shipped 150.6 million pounds, off -7.5% from last year’s 162.85 million pounds. Domestic shipments continue to decline month after month as almond consumption remains down overall. Shipments for August were 61.4 million pounds, off -6.16%, from a year ago. We have to go back 7 years to find a lower August shipment month.  

Some of these lower shipments can be attributed to the late crop, which has caused delays in the export of in-shell almonds. Only time will tell if these numbers can be made up later, but no doubt some consumption will have been lost that cannot be recovered.  

Upcoming Industry Milestones

  • Harvest Period: Harvest is in full swing and processors have started to receive their first loads from the huller shellers. More data will be made available each week as we learn more about the 2023 late harvest. 
  • Position Report: October 12, 2023

On a very positive note, despite the lack of support from growers for new crop offers (due to late crop and concern for crop yield and insect damage), new sales for August remained robust with 256.09 million pounds sold. This represents an increase of over 30% from last August when 195.8 million pounds were sold. This is a very positive trend and may lead to stronger shipments in the fourth quarter of this year. It will certainly take a big bite out of the carry-in, just as the August shipments did. As one can also see below, overall commitments have improved slightly from a year ago, with 621.9 million pounds now on the books, primarily driven by export sales, while domestic coverage lags behind last year's levels, down by 17%.

Almond Market Insights - Week 37 Update

Bullish Trends

  • New sales for August were very strong with 256 million pounds added, that’s a 31% increase YoY, which should translate to strong shipments in the fourth quarter of 2023.
  • With crop receipts delayed, this has provided the industry with an excellent opportunity to reduce the 800 million pounds of carry-in. Since the August shipments of 212 million pounds mainly consisted of old crop, and the new sales of 256 million, a significant portion is likely also old crop, although this is more speculative.
  • While the market has certainly firmed up in the last 5 days, pricing remains attractive for buyers and the firmness gives them confidence that the current bottom may have been reached.

Bearish Trends

  • Consumption is on everyone's minds as demand remains uncertain. Market prices are less of an issue than trying to understand where the demand will come from and whether it will pick up in the months ahead.
  • This is especially true for the domestic market, which happens to be the largest market for almonds. What is the almond industry doing to support its own backyard? Without a cohesive plan to address the month-over-month decline in sales, the industry will continue to face challenges.
  • Starting off with shipments lagging behind in the first month of the new crop year puts pressure on sales at a time when few offers are available. While new sales were strong in August, which was supported by the carry-in, future sales will rely on new crop offers, and currently, those are being sold on a very limited basis.
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