Almond Market Update – May 2019

The Almond Board of California released the April position report

Shipments were 177 million lbs. vs. 176.4 million lbs. in 2018 – slightly up.  **It is easy to forget that a year ago, 10.6 million lbs. of unreported shipments from throughout the season were all added into last April.  A true comparison shows monthly shipments are up about 11 million lbs., or close to 7%

DEMAND 

U.S. (up 1.6% YTD) was down 7.7%.  In a true comparison, shipments are actually slightly up (as April 2018 domestic shipments were really only 66.7 million lbs.)  

Exports (down 2.9% YTD) were up 6%  In a true comparison, exports were up 10.4%

Western Europe +11% (-5% YTD)  This seems to be the start of their strong finish to the season.

China/HK/Vietnam -62% (-27% YTD)  Shipments from Australia to the region during Mar 2018 through Feb 2019, quadrupled, growing by about 35 million lbs.  California’s shortfall this season is about 55 million lbs.

India +119% (+8% YTD)  

Middle East / Africa – Flat (+7% YTD)  

Japan +7% (+6% YTD)                                         South Korea +19% (+15% YTD)         

Central/Eastern Europe -17% (-1% YTD)        Canada -2% (+4% YTD)

2019 CROP       

NASS is forecasting 2019 bearing acreage at 1,170,000 acres, an increase of 7.3%.  A rough estimate of current industry expectations seem to be for a crop of about 2.55 billion lbs.  Tomorrow NASS will release the subjective estimate.

REVIEW:

Shipments were in-line with expectations and a slight new record, at first glance.  When considering the correction included in April 2018 figures, this is a really strong month, thanks to Europe playing catch-up.

April sales of 146 million lbs. are up 35% from last April’s 108.  This is above expectations.

Committed/Unshipped are 433 million lbs. vs. 374 a year ago, up 16%.

Committed/Shipped reached nearly 2.2 Billion lbs., approximately 85% of total supply and 99% of the projected marketable crop.  This figure went from 5 million lbs. behind to 33 million lbs. ahead.

Uncommitted inventory is 380 million lbs. vs. 445 million lbs., down 15%.

The figures are all pointing toward an extremely tight carry-out, likely the smallest as a percentage of supply since around 2005 and the smallest in volume since 2012 or perhaps 2010.   Sellers seem committed to reduce their carry-out as low as possible, which has kept pricing very stable despite the heavy sold position.

Spreads between varieties have been steadier the past few months.  If sufficient low quality Nonpareil has filled sales channels normally filled by pollinators, the tight carry out may be more balanced among varieties than the industry was expecting just a few months back.  This remains unclear and pollinators still seem to be the most heavily sold.

Strong commitments point toward a solid shipping month for May.  May of 2018 showed sales of only 76 million lbs. vs. the prior 4-year average sales of 115.  The industry is very likely to surpass the 76M in sales and show more bullish figures for uncommitted inventory, committed unshipped etc. a month from now.

Best regards,

Paul Ewing    Dennis Soares

Further info: April 2019 Position Report

Upcoming news:  NASS Subjective Crop Estimate – TOMORROW – May 10

                                      May Position Report – June 11

                                    NASS Objective Crop Estimate – July 3