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Almond Market Update - May 15, 2023

California may have seen the last of spring in the Valley as we head into the high 80’s and 90 degree temperatures for the next 10 days. Let’s hope the market heats up as well in the weeks ahead.  

Last week was a busy week for the industry as the April position report was released as well as the Subjective Estimate by the USDA. Total shipments for April were 197.26 million pounds, which was a stark difference from last year’s 245.24 million pounds, off -19.57%. This puts a halt to the industry’s streak of three months in a row of record shipments. Domestic shipments continue to be weak as 56.8 million pounds were shipped in April, off -9.0% to a year ago. Total Domestic shipments are now 544 million pounds to date, off by -6.10% from a year ago. Export shipments faired no better in April, as 140.4 million pounds shipped, of by -23.2% compared to a year ago, when the industry set an all-time record for April shipments of 182.8 million pounds. 

None of this should be a surprise, as most sellers in California have refrained from aggressive selling up to now. Yet with new sales for the month of April just under 115 million pounds, down 32% versus last year’s 168 million pounds, and well off the average new sales of 142 million historically over the last five years; the industry may be in a deeper hole than they would care to be in.  

The Subjective Estimate for the new crop year 2023/2024 was released by the USDA at 2.5 billion pounds, which is -3% less than last year’s production. We now have more information to move forward with the remainder of the current crop and new crop sales will begin to take more shape.

Upcoming Industry Milestones:

  • Growing Period: We had a heat spell this week and saw the first of irrigation this crop year!
  • Position Report: June 9, 2023
  • Objective Estimate: July 7, 2023

Almond Market Insights - Week 19 Update:

Bullish Trends

  1. Price levels remain historically low as we move into the final stages of current crop and begin new crop sales. 

  2. With the Subjective Estimate announced, the industry can take it out of neutral and shift into high gear now! 

  3. The Subjective Estimate forecasts 3% lower production in 2023/2024. When averaging the reports released thus far, expectations are for a new crop near 2.4 billion pounds. 

Bearish Trends

  1. Shipments declined in April and could lead to a larger carry-out than the industry would have liked. 

  2.  Commitments are now 564 million pounds, down 25% from last year’s 754 million pounds. Uncommitted inventory is now higher than last year at this time with 785 million pounds versus last year’s 771.47 million pounds.  

  3. With high inflation throughout the EU and other export markets, it is questionable how much can be expected from export shipments in the near future. Domestic shipments remain slower than expected.

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