Latest thoughts on Almond market
The large November shipment report bought a fair amount of excitement to the market. However, if the packers are able to maintain and hold last year’s overall sales, the carryout would be 471 million pounds. This remains a lot of product and if it does happen, it will have a negative impact on next year’s pricing when we will probably see another 100,000 acres come into production.
They really need to continue to sell in order to keep moving this crop. The acreage indicates that there is 1,000,000 acres bearing this year and right now there is 2,250 million pounds in estimated deliveries and it looks like they will hit this number. More of the 2017 crop will come into the plants, which on the surface indicates that the acreage report remains inaccurate. This crop did not produce 2,250 pounds per acre so there has to be more bearing acreage than the reported 1,000,000 acres.
If you add another 100,000 acres to next year’s crop then this will add another 200 million pounds to production. So, looking into the 2018 crop and with no further increases in monthly sales, you might see a total supply in 2018 close to 3,000 million pound. The one thing that will affect this number will be the pullouts. As the grower prices drop, you will see more pullouts of older orchards that only product about 1500-1700 lbs. per acre.