Almond Market Update - July 9, 2022
Happy Objective Estimate!
In the midst of the summer heat, the objective estimate was released by NASS.
California's 2022 almond production is forecast at 2.60 billion meat pounds, down 7% from May's subjective forecast and 11% lower than last year's crop of 2.92 billion meat pounds. The forecast is based on 1.37 million bearing acres. Production for the Nonpareil variety is forecast at 1.00 billion meat pounds, 12% percent below last year’s deliveries of 1.13 billion meat pounds. The Nonpareil variety represents 38% of California’s total almond production.
The industry has been waiting in anticipation for weeks as the objective estimate will now set the stage for the market to truly conduct business based on what the expected supply for the new crop year will be in conjunction with our carry-over. As a reminder, we have averaged 249 million pounds per month shipped over the last three months. This has led to shipments of 2.185 billion pounds to date. Next week the Almond Board will release the June shipment report, leaving just one final July shipping report remaining.
Upcoming Milestones:
- Position Report: July 12, 2022
Week 28 Update
Bullish Trends:
- Monthly shipments are expected to continue on trend as we look to close out the crop year on a positive note, and keep momentum in a positive direction heading into the new crop year.
- Logistics issues do remain, there is no sugar coating it. However, they are slowly being ironed out and show some improvement, which is also evident in the shipping numbers.
- With the lower estimate, it brings supply closer into place with demand and a more manageable supply.
Bearish Trends:
- With a larger carry-over, the industry must remain fluid and continue to sell. The market can not afford to increase pricing until the current crop is further sold.
- High inflationary pressures worldwide and exchange rates have put a hurt on export market purchasing power.
- There will be a great deal of second guessing on this estimate with many hesitating to buy into the number despite all the indications of the February freeze and, of course, the drought.
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