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Almond Market Update - July 28, 2023

Sunny days in California continue as we cool a little from the triple-digit temperatures to a more livable mid-90s for the next ten days. Hull split is widely prevalent now throughout the state’s growing region. Yet, harvest remains late and should start in the lower part of the state in two to three weeks, and then spread north.

The market has remained relatively quiet following the "Objective Estimate" of 2.60 billion pounds (for the upcoming crop year). There seem to be some who are not convinced of this number, with call pool growers hesitating to be too quick on the trigger. But for now, the industry will have to own this number until more can be learned from the harvest. It may be December before we truly know the actual crop size. With the large carry-out, it may not be productive to hold back at this time. Having said that, the current stock will be shy of the more sought-after sizes and varieties such as Nonpareil 27/30 AOL and Mission type.

Regardless of a decrease in production from the 3.1 billion pounds harvested in the 20/21 crop year, supply may still be out of balance with current global demand. June shipments were disappointing at 186.6 million pounds, down 33% from the 278 million pounds shipped last June, and July is not expected to be much better. Year-to-date shipments total 2.378 billion pounds, indicating a 3.5% decrease compared to last year's 2.465 billion pounds. With July pretty much in the books, it is likely that the industry will fall short of last year's total of 2.634 billion pounds, resulting in another large carry-out exceeding 800 million pounds.

Currently, new crop sales stand at only 122.4 million pounds. At this point last year, sales were over 236 million pounds for the new crop, and the year before that, they were 326 million pounds, a trend that must be turned around very soon.

Upcoming Industry Milestones:

  • Growing Period: Currently, hull split is widespread in all the growing regions. This year's crop is notably delayed due to the extended bloom we experienced in February and the cool weather we had up to two weeks ago.
  • Position Report: August 11, 2023

Almond Market Insights - Week 30 Update:

Bullish Trends:

  1. New sales for June of 155 million pounds were a shining star in an otherwise cloudy future. This surpasses last year's 142 million pounds and was an all-time record for any June historically. This should translate into better shipment numbers in the months ahead.

  2. As long as there is no UPS strike, shipping should remain robust in the months ahead and without presenting too many challenges.

  3. Market levels remain at historic lows, clearing the way for strong activity and steady growth for the future.

Bearish Trends:

  1. With an oversupply situation, growers and handlers will need to push for business to catch up before there is a healthy recovery. Time to be oversold.

  2. Growers are still pushing for premiums past the fourth quarter. While there may be some thought that the crop may be smaller than the estimate, business needs to get done and layered on. If we have a perfect bloom in February, and this crop is not sold, look out.

  3. Even now the market is sluggish, the industry needs to fill the demand that it has despite the shipping period to put a dent into the supply.

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