Almond Market Update - August 11, 2023

By: Richard Andonian

The weather in the growing region of California has been nice this week, hanging in the mid-90s during the hottest time of the day and cooling off into the low 60s at night. As we head into the weekend, we will see the temperatures rise once again into the low 100s. Hull split is prevalent throughout the state, and we are seeing the harvest begin in the lower southern part of the growing region, which is typical for this part of the harvest, albeit very late this year.

The Almond Board of California released the final "Position Report" for the 2022/2023 crop year. Total shipments for the year were 2.565 billion pounds, down -2.63% from last year's 2.634 billion pounds. For the month of July, the industry did end strong with 187 million pounds shipped. This was up +10% over last July's shipments of 169.4 million pounds. This was a result of strong exports this month, totaling 130 million pounds, which was up +16% over last year's 112 million pounds. Exports finished slightly off at -1%, with 1.848 billion pounds shipped versus last year's 1.869 billion pounds. Domestically speaking, the industry remains in a slump. While only off by -1% from last July's 57.2 million pounds, shipments were 56.6 million pounds. More importantly, domestic shipments finished down by -6.3% overall this year, with 716 million pounds shipped versus 765 million pounds a year ago.

Production was also off this year by -12%, with a total crop receipt of 2.571 billion pounds, down from last year's 2.922 billion pounds harvested. The industry stands at 204.9 million pounds of new crop commitments; however, last year at this time, 298.5 million pounds had been committed. The total carry-out will be 791.8 million pounds, down from last year's carry-in of 836.8 million pounds. Now that the final "Position Report" has been announced, this should open the door for more sales transactions to take place.

Currently, new crop sales stand at only 204.9 million pounds. At this point last year, sales were over 298.5 million pounds for the new crop, and the year before that, they were 441.5 million pounds, a trend that must be turned around very soon.

• Growing Period: Currently, hull split is widespread in all growing regions. This year's crop, while late due to the extended bloom and cool weather we had, is now at the start of harvest.
• Position Report: September 12, 2023

Bullish Trends:

1. New sales for July were 82.5 million pounds, much stronger than the same period last year when 63.3 million pounds were put on the books. This may translate into stronger shipments in the months ahead.

2. The industry ended the crop year on a strong note with July shipments, lowering the carry-out versus the previous year from 836 million pounds to 792 million pounds.

3. Market levels are at the most advantageous levels we have seen for some time, making almonds the best choice.

Bearish Trends:

1. The oversupply situation is one thing to certainly consider; overall demand may be of greater concern as consumption might be the biggest culprit.

2. The industry is undersold on commitments; new crop sales were at 298.5 million pounds last year at this time. Today we stand at 204.9 million pounds. As many processors compete for business, the buying opportunity has been enhanced.

3. The late harvest may put constraints on new crop shipments, missing a maximum opportunity to capitalize on Diwali. This may result in the industry continuing to be behind the eight ball, so to speak.

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