California Almonds Market Update 13.03.24

In February, California almond handlers shipped over 221 million pounds, marking a decline of 10% compared to the previous year. This drop was primarily driven by a 13.8% decrease in export markets. However, domestic shipments experienced a slight increase of 2.3%.

During the same period, handlers secured contracts for 214 million pounds of almonds. Although the total volume of contracted shipments currently falls below last year's figure by 19.6%, the monthly commitments added In February surpassed those from the previous year for the third consecutive month. Despite this, buyers have been consistently matching the pace of shipments with new commitments, indicating a preference for hand-to-mouth purchasing strategies.

Projecting Demand

In March of last year, shipments soared to a record-breaking 281 million pounds, marking it not only the busiest March ever but also the second-largest shipment month in history. However, California handlers are unlikely to reach this figure in March of this year. This decrease in shipments is in line with the observed trend of demand cycles reverting to pre-pandemic patterns. Last February's shipment figure lagged behind the previous year, reflecting this shift. February and March of last year represented a peak demand period influenced by pandemic-induced disruptions in supply chains. Now, it seems that demand cycles have largely normalised, indicating that the surge in demand in February and March of the previous year was unlikely to reoccur.

Bloom

During bloom, active weather conditions brought rain, cold days with morning temperatures in the 30s (0 degrees Celsius), and significant wind events. Despite this, extended periods of mild weather with ample sunshine persisted during the early stages of bloom, alleviating concerns regarding bee flight hours and other impacts on pollination vitality. While the conditions weren't ideal throughout the entire bloom season, overall, the bloom can be considered a positive event.

However, concerns persist regarding reduced cultural budgets. Growers have faced three consecutive years of significantly below-average prices while also dealing with rising input and labour costs. The unprecedented levels of damage and rejects observed this season are just one consequence of severely reduced cultural budgets. As growers scrutinise all expenses, even the ability to optimise fertilisation practices comes into question. While fewer and smaller applications save money in the short term, inadequate applications over several years can have significant and lasting impacts on an orchard's ability to achieve optimal production levels. Therefore, despite a positive start to the growing season, a return to peak production levels seems increasingly doubtful.

via Select Harvest USA