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Almond Market Update - July 14, 2023

While California temperatures may reach triple digits across most of the growing region this week, the heat has truly intensified for the almond industry according to the "Objective Estimate" released by NASS (USDA) on Wednesday. The estimate predicts that California will produce 2.60 billion pounds of almonds for the 2023/24 crop year, representing a 1% increase compared to last year's crop of 2.57 billion pounds. This calculation is based on 1.38 million bearing acres, resulting in a yield of 1,884 lbs. per acre. The industry will need to take ownership of this data and adjust almond marketing accordingly. View the 2023 Almond Objective Measurement Survey Results, here!

Furthermore, the Almond Board of California published the "June Position Report", which reveals that crop receipts for this year have reached a peak of 2.57 billion pounds. This marks a decrease of nearly 12% compared to the previous year when the industry harvested 2.91 billion pounds, and a decrease from the 3.1 billion pounds harvested in the 20/21 crop year. June shipments were disappointing, totaling 186.6 million pounds, down 33% from the 278 million pounds shipped last June. Year-to-date shipments amount to 2.378 billion pounds, indicating a 3.5% decrease compared to last year's 2.465 billion pounds. With one month remaining in the current crop year, it is likely that the industry will fall short of last year's total shipments of 2.634 billion pounds, potentially resulting in a carry-out inventory exceeding 800 million pounds.

At this time last year, the industry had already recorded sales of over 236 million pounds of the new crop, and the year before that, it was 326 million pounds. Currently, new crop sales stand at 122.4 million pounds. Expect this figure to change significantly over the next 60 days as the industry catches up. With a large carry-out and a substantial crop on the horizon, the pressure is mounting.

Upcoming Industry Milestones:

  • Growing Period: Hull split is just commencing in certain regions, indicating that harvest will take place within 30 days. This year's crop is notably delayed due to the extended bloom in February and the cool weather experienced thus far. 
  • Position Report: August 11, 2023

Almond Market Insights - Week 28 Update:

Bullish Trends:

  1. New sales for the month of June were very strong at 155 million pounds, surpassing last year's 142 million pounds. This sets a historical record for June sales and is expected to result in robust shipments in the coming months.

  2. Shipping issues stemming from the pandemic have been resolved, enabling the industry to transport products under pre-pandemic conditions.

  3. With the "Objective Estimate" behind us, the industry can actively sell the new crop moving forward. This late arrival of the new crop also provides an opportunity to sell remaining stocks of the current crop.

Bearish Trends:

  1. The over-supply of almonds may continue to constrain the market until demand catches up with the available supply.

  2. Consumer behavior appears to have shifted, with a slowdown in consumption observed across all tree nuts. Merely adjusting pricing may not suffice, as consumers might be seeking more economical alternatives or prioritizing comfort food over healthier options.

  3. There will be pressure to make up for lost time. Sluggish sales will compel producers to ensure that no shipping opportunities are missed. Party on, Garth!

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