Almond Market Update - May 12, 2021

This week has brought more summer heat, as temperatures will hit a high of 97 degrees in some areas of the growing region and pretty much stay in the mid to high eighty’s all of next week.  As previously mentioned, drought conditions are grabbing the headlines now.  Throughout the state, water conditions only worsen.  It is very early into the fire season, yet it is already upon us with 13,922 acres burned thus far throughout the state.

The April shipment report was released yesterday.  The crop receipts have all but topped out now with 3.098 billion pounds received to date, which translates to maxing out  at just over 3.10 billion pounds.  The industry continues to exceed expectations.  With over 2,228.8 billion pounds shipped year to date, the industry is now +19.6 % ahead of last year at this time. Additionally, 163 million pounds of new business was added on during the month, out preforming last April’s 125 million pounds by +30.6%. 

Driven mainly by export volumes, we saw 180 million pounds exported in April.  About a 74% increase over last April’s shipments.  Overall, export shipments are ahead of last year by 28%. All export markets are contributing to the increase led by China up +67%, India up +57%, the UAE up +23%, and Western Europe up +14% year to date.

Meanwhile, USA domestic sales have slowed down over the last two months. April sales were off – 10% versus last year with 70 million pounds shipped versus a record last year of 78 million pounds.  We now stand just 2% ahead of last year, with 602 million pounds shipped year to date.

The even bigger news is today’s subjective estimate released today by NASS.  Based on a forecasted 1.33 million acres and a forecasted yield of 2,410 pounds per acre (-3% below 2020 crop yield), the subjective estimate for the 2021 crop is 3.20 billion pounds.

Remaining Benchmark Dates:

• Next Shipping report: June 10, 2021
• Objective Estimate: July 12, 2021
• Final shipping report for the 2020 crop year: August 12, 2021

Week 19 Update:

Bullish Trends:

1. April shipments are another record 38% ahead of last year, with 250 million pounds shipped versus 181 million pounds last April.
2. With shipments and commitments now at 2.95 billion pounds, the industry is roughly 84% sold for the 2020 crop.  This may bring the carry-over to a comfortable 650 million pounds.
3. With just three months left of the 2020 crop, it looks more and more apparent that we may reach the magic target of 2.8 billion pounds shipped. 

 Bearish Trends:

1. Domestic shipments cannot be glossed over as they represent the largest market for almonds and we see that they are trending down.  This will have an impact on the future sales still on the trees.
2. Perhaps the shipping issues have caused some pantry loading of their own as we see major shipments for export.  Going into historically the slower consumption times periods in these regions, may cause a slow down in new crop sales.
3. The subjective estimate of 3.20 billion pounds will keep a sealing on any opportunity for the industry to try to edge up pricing, at least for the short term.