Almond Market Update - October 22, 2021
It is so refreshing to finally see some wetter weather hit California. For some areas, it has been over 200 days since they received any rain. Well, that has all changed this week as we have had as much as 1” to 2” of rain in the Northern part of the state. We have also seen another 6” of Sierra snow to go along with it. Most importantly we are expecting even more all throughout the weekend and into next week. Let’s hope the storm doors have opened to bring us significant rainfall as rain could not have come at a better time!
Last week the Almond Board of California released the September shipment report. If you saw last week’s report then forgive me for restating it. The shipments of 227.64 million pounds were off -33.3 MM pounds from last year at this time. This is off -12.8% from last year. This was led by export shipments being off -17.2 % with 163 million pounds shipped versus last year’s 197 million pounds. While domestic shipments were flat with 64 million pounds shipped, a slight improvement of 0.8 % from the same period a year ago.
With a smaller crop expected this year, we have seen a hesitancy on behalf of the growers to sell early. These growers are waiting to see exactly what they have in terms of their harvest in both yield and sizes before selling. However, now that harvest is all but complete there is still a large crop to ship. As a result, the market has weakened with many sellers jumping into the market at the same time. To say the least, the market is muddy at best as the market works to find itself.
Week 43 Update
- Demand continues to be strong leading up to the holidays. Europe and India are also showing buying interest. This has helped the market to find a trading range for the time being.
- Shipping woes were bound to catch up eventually. However, last month was the second largest shipping month for a September, second only to last year.
- Last years shipments can be considered an outlier, with an exceptionally large crop and concerns of the pandemic driving record shipments due to pricing uncertainty. Compare this September to two seasons ago and the industry is 20% ahead in shipments.
- If October is another down month in shipments and brings lower new sales numbers, then we could see a further decrease in price.
- Forward commitments are well off the pace of last year, a change of -34%. With uncommitted inventory increasing each day the storage pressure continues to mount.
- Port issues continue to persist with no real end in sight. The government stepping in won’t solve problems that have now persisted for well over a year.
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