Almond Review - November 2017

Today the Almond Board of California released the October 2017 position report

October shipments were 246.5 million lbs. vs. 235.6 million lbs. in 2016 - up 4.6% from what was the largest shipping month in history.  

DEMAND

U.S. shipments: +6.3% (+2.5% YTD)

Exports: +4.1% (-1.4% YTD)

CURRENCY:  The USD strengthened slightly, currently at 1.166 to the Euro (vs. 1.18)

2017 CROP

Receipts YTD were 1.529 billion lbs. vs. 1.56 billion YTD 2016.  With some increased efficiencies and hulling capacity in California, about 117 million lbs. more were received vs. October 2016.  

Bud Set 2017 11.jpg

 

REVIEW & OUTLOOK:

Sales during October were 201 million lbs., up 10% from a year ago, with over 3/4 of these coming from export markets.   With moderate buying activity, and plenty of selling support, pricing softened, particularly on lower quality grades.  Pricing was very stable heading into today's report. 

Shipped/Committed reached 49% of total supply (1.28 billion lbs.) -  maintaining a similar pace to last year.  

China is behind on shipments (-12%) due to their later Chinese New Year and the timing should help boost the November/December figures.  It seems handler capacity is very booked up for November.  With the December position report (due January 11) we should have a much better grasp on consumption and the 2017 crop size.  At the rate we are going, about 60% of the crop should already be sold by then.   

Today's news is right in-line with expectations and should be neutral.  Short-term pent-up demand coming in (including from China), or a more widely perceived strong outlook for November, could potentially bring some strength to the market.  On the other hand, continued selling support may hold back too much firming.

Best wishes,

Paul Ewing      Dennis Soares 

 

Upcoming news:  November Position Report - Tuesday December 12

Further Info:  October 2017 Position Report

Almond Review - October 2017

Today the Almond Board of California released the September 2017 position report

September shipments were 190.6 million lbs. vs. 201.6 million lbs. in 2016 - down 5.4%

DEMAND

U.S. shipments: -13.3% (+0.6% YTD)

Exports: -2.2% (-5.2% YTD)

Late pollinator receipts held September shipments from reaching their potential.  

CURRENCY:  The USD strengthened after the Fed announcements September 20, signaling future increased interest rates.  The USD is at 1.18 to the Euro. 

2017 CROP

Receipts YTD as of September 30 were 844.2 million lbs. vs. 960.6 million YTD 2016.  They continue to trail last season due to the late harvest and slow hulling season.

Insect damage so far is 2.35% vs. 1.24% a year ago.  This along with the high volume of doubles is reducing the availability of high quality grades and increasing supply of lower spec material.  

NASS seems correct in their assessment of a good Nonpareil crop and inconsistent pollinator crop.  We see a high degree of variability in pollinator yields (from field to field) and the following averages (preliminary and localized):  Monterey +5%, Wood Colony +14%, Butte -9%, Fritz -4%

Bud development for 2018

Bud development for 2018

OUTLOOK:

During September, handlers were limited in what to sell due to the late crop and challenging quality.  The heavy commitment figures with the prior report, along with concerns about 2017 yields, also kept some from selling.  Despite only moderate activity taking place (235 million lbs. or 9% of total supply), pricing moved up due to a lack of offers.  Shipped/Committed reached 1.08 billion lbs. or 41.5% of total supply - similar to a year ago.  

As more sellers returned to the market in October, activity has been low.  In any case, many handlers are fully committed for October from earlier sales.  Due to the supply challenges mentioned and more prolonged buying for a later Chinese new year, we will need at least 2 if not 3 more shipment reports to gauge demand / real consumption, though most buyers report it's quite healthy.  

Best wishes,

Paul Ewing      Dennis Soares 

 

Upcoming news:  October Position Report - Friday November 10 (Updated from Nov 9)

Further Info: September 2017 Position Report

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Almond Review - September 2017

Today the Almond Board of California released the August 2017 position report

August shipments were 168.6 million lbs. vs. 170 million lbs. in 2016 - down 1%

DEMAND

U.S. shipments: +14.4% (all-time record)

Exports: -9% 

Inshell Exports were down 42% due to the later harvest and low inshell stocks.  Kernel exports were actually up 11% despite the late start.

CURRENCY:  The USD is weakened slightly further, currently at 1.20 to the Euro. 

2017 CROP

Receipts YTD as of August 31 were 215 million lbs. vs. 359 million YTD 2016.  Harvest started later and hulling/shelling advanced slower due to higher hull moisture, caused by humid weather.  

Nonpareil harvest is complete and even Monterey are being shook in much of the state.  Fritz is the only variety left in our area and those should be shook in 7-10 days.  High temperatures and mites caused considerable stress on the trees, with many losing more leaves than normal.  There is less chip & scratch and more doubles.  We are seeing and hearing of fields with very high insect damage, which is reflected in the state-wide inedible of 2% vs. 1.4%.    Yield reports remain inconsistent, with some of the best yields vs. last season in the later blooming areas of the west and north.  

Harvest 2017 09.jpg

OUTLOOK:

The industry's loss & exempt was adjusted upward from the estimated 2% to actual 2.26% for the 2016 crop year.  Adjusted carry-in was 398.6 million lbs., which is a very minor change but psychologically positive.  We may see a higher L&E this year due to the high insect damage.

The market was soft through second half August, and then firmed heading into today's report.  Shipments were on the high end of expectations but no big surprise.  The revelation today was the commitments of  677.2  vs. 481.8, up 40.5%. California handlers made an effort to sell off any remaining '16 crop and continue marketing the '17 crop.  The shipped + commited figure of 846 million lbs. (vs. 651)  brings the industry to 32.5% sold on total estimated supply of 2.6 billion lbs.  This is a very comfortable sold position for the industry and bullish news.  The seasonal increase in buying activity seems to be getting underway.                                                                              **The Almond Board corrected today's earlier reporting of 763.6 million lbs. of commitments to the correct 677.2.  We have updated the above figures with this correction.

Feel free to contact us with any feedback, questions or inquiries you have.

Best wishes for a great new season,

Paul Ewing      Dennis Soares 

 

Upcoming news:  September Position Report - Wednesday October 11

Further Info:  August 2017 Position Report - Corrected