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Almond Market Update - February 5, 2021

Where oh where did January go?  Well, it is in the books and we keep moving forward.  The weather in California last week brought us some much needed rain and snow.  It kept up through Wednesday this week adding more rain and snow to the Sierra’s.  While we are not by any means out of trouble yet, it is a welcomed sight.  The forecast for next week and beyond is showing clear skies and temperatures above 60 degrees which would signal ideal conditions for the start of the bloom. 

As a side note, one of our customers whose father is a scientist shared that current weather forecasting is not as accurate as it usually is.  This is due to commercial airlines (and a largely reduced number of flights) are unable to provide the same level of real-time weather data to the National Weather Service, which they used to do extensively prior to COVID-19.  As a result, you may have noticed slight variances and shorter lead times on the weather forecasts.  

With that in mind and almond bloom right around the corner, we hope the forecast is accurate, but we also understand that it can change very quickly, just as it did this last week.  I am sure this is why we see increased buying activity today ahead of the bloom and the position report due out next Thursday, February 11th.

 

Week 5 Update:

Bullish Trends:

  1. January shipments are estimated to exceed last January’s shipments of 220 million pounds. The only thing holding us back are the shipping lines.
  2. We continue to see some the most advantageous market levels in many years.  The upside of waiting for even better prices is outweighed by the potential downside of a possibly poor bloom and continued demand.
  3. Consumption remains strong in most segments and as we see the food service industry begin to come back, the momentum will continue to grow.

 Bearish Trends:

  1. January was a slower sales month for most. This is a leading indicator of buying interest beginning to wane.  
  2. With major shipping issues continuing to mount, many ports are rolling back load after load which will start to reflect in the shipping numbers.  Once out of stocks occur there is no making up for the lost consumption or opportunities.
  3. Lower price levels will not fix the shipping issues and growers will only go so far to adjust pricing with levels that are already increasingly low. Combined with growing crop receipts, the industry will need to pull a rabbit out of the hat this time.

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