Summer doesn’t want to go away in California, as we have experienced triple-digit temperatures this week, making it difficult to harvest and driving moisture out of the almonds. With harvest in full swing, the heat has added to the anxiety, shortening the hours during the day that harvest can take place. Early indicators continue to point to a smaller crop than initially expected and may be closer or below the 2.8 billion-pound estimate that many initially thought was a miss. As we have now entered September, the pollinizers will start to be harvested, and more of the story of the 2024/25 crop will unfold.

As a refresher, last year’s crop receipts of 2.446 billion pounds marked three years in a row of decreased almond production. It also represented a decrease of nearly -5% from the previous crop year’s production of 2.571 billion pounds. That was not a problem since we also had a carry-out last year of 800 million pounds! However, the industry was able to ship 2.692 billion pounds, which plummeted the carry-out this year to approximately 451 million pounds (once the additional loss and exemptions are accounted for). This is the smallest carry-out the industry has seen since 2020 and has really brought supply in line with demand since the 2020/21 crop year. Unfortunately, it has contributed to a harder-to-find current supply of higher-demand material until harvest can be completed and we start to see new crop shipments come into play.

Returning to the new crop, prior to the Objective Estimate, expectations had estimated the crop to be larger, in the range of 2.9 to 3.1 billion pounds. A 2.91 billion-pound crop, while still within the margin of error, and a smaller crop of 2.68 billion pounds are starting to look closer to the 2.8 billion-pound estimate, if not smaller. The industry continues to market the 2024/25 crop as a 2.8 billion-pound crop, but with a number of growers not responding, this may soon change.

With the industry off to a strong start and over 379 million pounds of new crop already on the books, many are content to wait and watch the crop come in before getting too far ahead of themselves.

As a result of all the above, we have seen market firmness continue week over week. While current levels are higher than we have seen in recent history, this is a function of supply and demand. Almonds still represent a great value compared to other tree nuts and did not see lower pricing at the consumer level over the previous years pass to the consumer as one might have expected. Expectations are for this firmness to continue through the fourth quarter of 2024. By December, the industry will have a much better understanding of this year’s crop.

Upcoming Industry Milestones:

• Position Report:  September 12, 2024

Bullish Trends:

• New crop sales have given growers confidence going into harvest, production lines have filled up to carry them forward enough to take a pause and allow harvest to catch up.  
• The 2023/24 crop year was the second strongest shipment year in history at 2.692 billion pounds. The industry will now take that momentum into the new crop year.  
• As we have seen, the current crop is virtually sold out. A carry-out of less than 451 million pounds, with most of the product consisting of below USDA grade material, has made it a very tight transition. 

Bearish Trends:

• As many conventional retailers never lowered their retail prices during the downturn, it will be interesting to see what they do with the higher prices now. 
• With little supply remaining to fill the gap before new crop, August shipments may reflect an inability to ship, putting the industry behind in position for the new crop year. 
• Export shipments are becoming delayed due to equipment shortages, which may lead to even more difficulties in the weeks ahead. Transportation costs have also increased leading to higher costs to land product.