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Almond Market Update - July 21, 2023

The heatwave officially hit California last week at triple digits and continues across most of the growing region this week. It is forecasted to continue into next week. Hull split can be seen in all the early varieties now, signaling that harvest will be just a few weeks away.

The week following the Objective Estimate of 2.60 billion pounds for the 2023/24 crop year has been less than remarkable, with minimal business getting done, generally speaking. In that time, we have seen the market weaken for third and fourth-quarter business.

Despite 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, demand continues to be questionable. June shipments were disappointing at 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 of 2.634 billion pounds, potentially resulting in another large carry-out exceeding 800 million pounds.

The industry is also lagging behind in new crop sales. At this point a year ago, sales were over 236 million pounds for new crop, and the year before that, it was 326 million pounds. Currently, new crop sales stand at only 122.4 million pounds. There is a great deal of make-up to do as the industry will want to be better positioned going into the fourth quarter of the year.

Upcoming Industry Milestones:

  • Growing Period: Hull split is more prevalent this week as hot conditions have taken hold. This year's crop is notably delayed due to the extended bloom in February and the cool weather experienced thus far. However, with an extended heatwave, some time may get made up in the final weeks of the season.
  • Position Report: August 11, 2023

Almond Market Insights - Week 29 Update:

Bullish Trends:

  1. With strong new sales for June of 155 million pounds, this surpasses last year's 142 million pounds. Record sales for June should translate into better shipment numbers in the months ahead.

  2. Containers and cargo ships are more available now and should set well for prompt shipments in the near future.

  3. With the Objective Estimate in the rearview mirror, the industry is more active each day. With some of the most favorable pricing available, there has not been a better time to book business for prompt orders.

Bearish Trends:

  1. The industry is in an oversupply situation, and demand will need to catch up with supply before there is a healthy recovery.

  2. Having said that, consumer behavior may have shifted for the time being, with a slowdown in consumption observed across all tree nuts. Pricing alone is not the answer. The ABC will have to focus more on marketing, not only domestically but also around the world, to remind consumers about the goodness of almonds.

  3. Pressure to move almonds has brought all the growers back into the market at the same time, pushing already low levels down further. With sluggish sales, producers will ensure no shipping opportunities are missed.

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