Almond Market Update - November 20, 2020
We have received some all-important rainfall over the last few days. It is a welcome change and we already can see a major difference to the air quality in California following a difficult fire season. With this starts our winter, with hopes of strong seasonal rain and snowfall. January is typically where we will look for the largest concentration of both. I remain hopeful for an early ski season! Interestingly the ski resorts will require prior reservations for your ski day. No just showing up. It is a brave new world.
For all of you heading off for an early Thanksgiving week, we at Olam want to wish you a warm and safe holiday and a Happy Thanksgiving.
The market has started to show strength this week following the record October shipment of 309 million pounds. The almond industry could not be happier with these results and our expectations remain high for record shipments to continue throughout the crop year as they will need to, in order to move this potential 3.0 billion pound crop of ours.
We received an additional 758 million lbs. in receipts in October, bringing the year to date to 1.810 billion pounds or +14% ahead of the same period last year. That record shipment came from both domestic shipments of 73 million pounds, up 18% from a year ago, and export shipments of 235 million pounds, up 16% over last October. With year-to-date shipments now at a combined 764 million pounds, we stand 25% ahead of last year.
Week 47 Update:
- We are seeing strong consumption continue even in areas such as India, where the supply is exceptionally high. The demand is responding due to advantageous pricing with India up 110% year to date. Expectations are for new sales to resume this month.
- China is another indicator as demand has been outstanding, possibly showing that the importers are successfully having duties waived by the Chinese government. This has led to an 11% growth year-to-date.
- With strong shipments and consumption keeping up thus far, there is increased confidence that we will see global demand stay in sync with our growing supply this year.
- While demand has been strong in the fourth quarter, this is the peak season, therefore it is understandable. The real test comes in the first and second quarters of next year.
- Additionally, last year the industry had loaded everyone up in advance of fourth quarter so these are results of timing. Five out of seven of the months from January through July were record shipments. Hard to repeat!
- Forgetting COVID-19 for a minute (if that is possible…), the cards may be stacked against us. How can the industry maintain a 25% growth this year with everything else going on around the world?
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