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Almond Market Update - August 11, 2022

The almond harvest is slowly underway. The most stressed areas are being harvested first and sent to the huller/sheller’s for initial processing. We continue to see the nonpareil slowly trickle in, as we received some of our first loads early last week. In comparison to last year, the crop appears to be running a little later than what we expected. Regardless, we will continue to see harvest gain steam over the next week or so. The weather has remained hot throughout the valley with average temperatures upwards of 95 degrees and highs in the south at 105. Occasionally, there has been a day or two of  cooling trends of 5 to 10 degrees, but they have been short lived. It is a hot and dry summer in California.

Early indications of crop receipts are hardly worth mentioning, if not predictable. The sizing has shown small kernels and “not so good quality”. This is typical for this time of year, given where the almonds have been harvested thus far. The talk on the street is the objective estimate of 2.6 billion pounds is seemingly more realistic and closer to reality than we first thought. We will begin to compile more data over the weeks and months ahead.

The market has remained quiet this week and the gains in market levels that were made in the last quarter, have now disappeared.  Having said that, grower interest in selling still remains for current inventory and anything shipping in the short term. As a result, pricing has weakened. With a record breaking carry-out (that we hope to never experience again), growers remain hesitant to push too hard too soon. The only thing truly holding the industry back is the expected carry-out of 820 to 840 million pounds. But, we will see if there are any hidden surprises in the shipping report coming this Friday!

Upcoming Milestones:

  • Position Report: August 12, 2022
  • Position Report: September 9, 2022

Week 33 Update

Bullish Trends:

  • With a second straight crop year with lower production from the record 3.1 billion pound crop in 20/21, the market should see the light at the end of the tunnel once the carry-out has been worked through.
  • A smaller crop and the drought conditions in the west continuing to hinder further growth,  evening supply with demand.  
  • Almonds remain a great plant-based protein and are the consumer’s choice for healthy snacking.  Market levels are very advantageous regardless of the type or ingredient needed.

Bearish Trends:

  • The carry-out is indeed a cloud hanging over the industry. Until it is sold through to a workable level, pricing will remain impacted. If the growers hold on too long, it could lead to unintended consequences for the new crop.
  • Some inflationary indicators have slowly started to ease as we see fuel prices have come down; food prices at retail have bucked the trend and continue to rise.
  • With only a few weeks now into harvest, it is too soon to talk this crop down in size; 500 million pounds disappearing in the course of two seasons while the actual bearing acreage has increased is unlikely. 

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