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Almond Market Update - February 17, 2022

We are now officially into bloom! The trees have really exploded and are loving the warm 70+ degree weather during the daytime, with plenty of sun to boost. It is not going out on a limb to say it is "ideal bloom weather." Beehives can be found throughout the orchard floors, providing plenty of work for the bees as the bloom happened rather quickly. No significant changes to our weather are forecasted for at least the next ten days. By then, most varieties, if not all, will have completed the bloom cycle and are quickly moving to the next stage. More to follow. 

Last Friday, the Almond Board of California released the January Shipment Report. It was anticipated to be off from last year, as export shipments continue to falter due to logistics issues. With 177 million pounds shipped versus last year's 194 million pounds, the industry now trends -16% behind last year in shipments, with 1.239 billion pounds shipped YTD compared to the 1.478 billion pounds a year ago. Shipping woes make it nearly impossible to meet the continuously strong demand. The result, however, remains the same: supply is now exceeding the missed consumption opportunities as time passes and exporting struggles continue. 

On a positive note, domestic shipments were strong. In fact, January was the strongest month of the new crop year with 66.57 million pounds shipped, an increase of 13.3% over last year's January time period. This brings us flat to last year. Unfortunately, export shipments are dragging the industry down with only 110.64 million pounds shipped, -18.4% behind last January. Exports are trailing -22% in total compared to last year. 

California continues to struggle with the water situation. While it may not have any effect on the current supply of almonds, the reality is there may be a lasting impact on the future of California almonds should the drought continue much longer. January and February were the driest on record, resulting in significantly less water at this time than we had last year (the second year of the drought). While we had a great December registering 160% to normal Sierra Snowpack (where close to 50% of our water comes from), we now reside at only 70% to normal. This number will continue to plummet as we remain dry with no rain or snow currently in the forecast. In fact, it is so dry that many growers are opting to irrigate right now, rather than waiting another month or at least following the bloom.


Upcoming Milestones:

Shipment Report: March 11, 2022
NASS Acreage Report: April 21, 2022
Subjective Estimate: May 11, 2022
Objective Estimate: July 6, 2022

Week 8 Update

Bullish Trends

  • Domestic shipments were the shining star this month and reflects the strong demand that remains in place. As export shipments improve, the ship will be righted once again.
  • Market activity has increased as more buyers are seeing these new levels as a good time to take coverage and guarantee they receive their product in time.
  • More popular sizes and varieties will become scarcer as time moves on, however there are great values to be had presently, which is evident by the number of inquiries this week. 

Bearish Trends

  • New sales for January at 207 million pounds may come as a disappointment to many compared to a strong December (247 million pounds). 
  • There seems to be minimal momentum as the market continues to find itself and shipping issues continue to drag on. With the industry only 56% sold compared to last year's 67%, it seems unrealistic to imagine this being made up, as we may be staring at a 900 million-pound-carry-out
  • With the ideal bloom appearing in front of us, how will this impact the remainder of the crop year in terms of marketing the balance of the crop? More questions than answers. 

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