While it may be officially fall, California is experiencing triple-digit temperatures throughout the growing region. This has certainly sped up the almond harvest, as the heat has dried things down quickly. Evidence from the first position report of the new crop year shows that over 290 million pounds have already been received, a 313% increase compared to the same time last year. While the crop is expected to be larger than last year’s, it may not be as robust as initially thought. This increase is more about timing, with the new crop arriving on time, versus last year’s crop, which was late and slow to come in.

Just two weeks ago, the Almond Board released the August position report showing the above crop receipts to date.  At this time last year the industry had only received 70 million pounds.  This may be due to the extreme heat we have experienced through August and now into September. By the time the almonds hit the ground, they are being swept up, as moisture levels are very low. This is quite the contrast to last year when we had delays in harvest and even rain during the harvest that slowed everything down.  The reality is that this heat may reduce tonnage this year, as the moisture content in the almonds overall may be 1-2% below normal. 

Shipments for the first month of the new crop year totaled 168.28 million pounds, down 20.63% to last year’s 212.01 million lbs.  It is very apparent this may be a result of the industry not having much, if anything, of the previous crop left to ship. The carryout is primarily made up of unsaleable inventories, as most expected it would be after a tough year of serious damage. Expectations for September should show a notable improvement as the industry starts to ship new crop.  Look for a stronger fourth quarter as production of new crop ramps up.  

Domestic shipments for August were up a modest 1% with 62.05 million pounds shipped. While modest, it represents continuous growth compared to last year, when shipments finished up 1.63% over the previous year. Meanwhile, export shipments were down -29.5% with 106.23 million pounds shipped versus last year’s 150.60 million pounds.  Again, the industry demonstrated that there simply were not the quality almonds in the carry-in needed to ship during the transition period. The difference is vast between an 800-million-pound carry-in and a 500-million-pound carry-in. Look for a significant improvement in the months ahead. 

Total new sales for the month were 159.35 million pounds, down 37.8% to last year’s sales of 256 million pounds. Sales slowed down in August as the crop coming in looked worse than previous month expectations.

Commitments this year are down 2.3 % standing currently at 607.6 million lbs. vs last year’s 621.9 million pounds. This can be attributed to mostly domestic buyers holding off, not buying into rising almond levels. The industry has not seen such low commitments at this point since 2015. With that said, the stand-off will have to end soon, as inventories will soon be depleted. Meanwhile, export commitments are up 14% year over year, with markets assuring themselves of bookings to restock inventories through the holidays.  

After two months of harvest, while it is still too soon to estimate the crop’s potential, it is confusing many, as the crop is down in one area and up in another throughout the growing region. This is causing confusion and raising questions about whether it can even reach the objective estimate of 2.80 billion pounds. Thus, growers are holding off and are hesitant to push sales past December until a better understanding of the crop can be established.

Upcoming Industry Milestones:

• Position Report:  October 11, 2024
• Almond Conference (almonds.com): December 10 - 12, 2024

Bullish Trends:

• New crop sales thus far are strong enough to satisfy most growers. The production lines are filled through October now, any new sales may not ship until November. 
• The crop may not reach the objective estimate of 2.80 billion pounds, justifying current market levels.  At this point, growers are not backing down.
• Almonds still remain a great value versus the other tree nuts, including cashews and pistachios.  

Bearish Trends:

• The August position report was mixed with shipments below expectations. This puts the industry in a hole vs last year. 
• Even with a smaller carry-in this year, with a 2.8 billion lbs. crop, the total production will exceed last year’s almond supply. 
• With a port strike threatening to hit the east coast in October, a ripple effect may disrupt exports to the rest of the world.