Almond Market Update - March 3, 2022
Following last week’s unexpected cold snap and freezing temperatures in the early mornings, many growers have pulled off the market this week to assess what damage, if any, occurred to their orchards. It should be noted the freeze occurred to the northern and north-central areas of the growing region, while most of the crop is grown in the southern part of the state. Due to the colder weather, bloom progression has slowed down, but remains almost complete. We continue to see petal fall as well as green replacing the once white leaves throughout the orchards.
The market is firm this week as a result from fewer offers being made, however, will this be short-lived based on the growing supply of the current crop coupled with export issues remaining prevalent throughout the industry? With the February shipping report coming out March 11th, all eyes are on shipments (which were 234 million pounds last year), new crop sales, and uncommitted inventory remaining for the 2021-2022 crop year.
The California snowpack is now at 68% to normal, falling precipitously from the 168% we saw at the beginning of the year. We have, in fact, had one of the driest past two months on record. Washington Post (2022) reports, “precipitation has essentially flatlined during what should be the wettest two months of the year.” According to historical data, the drought is being recognized as the most extreme in 1,200 years, a study from the Journal of Nature Climate Change finds, in fact the last 22 years have been the driest span in that time-period. The Washington Post article provides more details, while remaining focused on the fact we are seeing the worst of the megadrought in more than a millennium.
Shipment Report: March 11, 2022
NASS Acreage Report: April 21, 2022
Subjective Estimate: May 11, 2022
Objective Estimate: July 6, 2022
Week 10 Update
- With few offers being made from sellers, we have seen the market firm this week as buyers become anxious to book their needs.
- The freeze from last week has helped many to realize nothing is guaranteed, and despite shipping issues and plenty of current stock, supply for next season is not an automatic.
- We are seeing shortages of specific sizes of the Nonpareil variety; currently, sizes 27/30, and larger, are becoming increasingly difficult to find.
- While there are many things occurring here, the basics tell us that supply is out of sync with demand and an inability to maximize exports remains. While the industry typically exports 68% of the crop, there may not be a fix in place for many months to come.
- Regarding the freeze event last week, while it may have some effect on the flowers, the almond tree only needs to set 20% of its buds to have what is considered a “good crop.” Out of 10,000 flower buds the almond trees reveal, 20% become almonds, on average, which leads us to believe the crop is well protected under just about any circumstance.
- Time is not on the industry’s side. With only five shipping months remaining it will become increasingly difficult to avoid a billion-pound carry-over. This could result in severe storage issues for the industry.
Leonard, D. (2022, March 1). California endures one of its driest January and February stretches as drought worsens. The Washington Post. https://www.washingtonpost.com/weather/2022/03/01/drought-california-record-dry-february-january/
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