Almond Market Update – January 2020

The Almond Board of California released the December 2019 position report

Shipments were 205.9 million lbs. vs. 199.6 million lbs. in 2018 – a new record & an increase of  3.2% (+4.4% YTD)  

DEMAND 

U.S.  +7.7%  (-1.8% YTD)  

Exports +1.5%  (+7% YTD)

Western Europe +14% (+14% YTD)  

China/HK/Vietnam  -66% (-39% YTD)

India +22% (+1% YTD) 

Middle East / Africa +6% (+62% YTD)  

Japan  +13% (+14% YTD) 

South Korea -15% (-5%)

Canada -11%  (+4% YTD)

2019 CROP   

Crop Receipts per reporting to the Almond Board reached 2.385 billion lbs., up 183 million lbs. or 8.3% from a year ago.  USDA reported receipts reached 2.393 billion lbs.  The USDA reported Dec 31 2018 number represented 97.2% of final receipts, which would put this crop at 2.46 billion lbs.  Considering how late the shelling season is, with several major hullers still going in January, the crop seems above 2.46.

Major Variety Swings

	So Far	Vs. 1 year Ago	% Change
Nonpareil	1,002,190,943	866,368,395	+15.7%
Independence	151,622,801	104,739,730	+44.8%
Monterey	410,238,998	386,309,470	+6.2%
Wood Colony	93,254,698	69,932,703	+33.3%
Butte/Padre	277,950,727	313,771,708	-11.4%
Fritz	98,920,675	112,067,207	-11.7%
Carmel	115,854,363	124,542,667	-7.0%

The growth in the crop is largely made up of Nonpareil and Independence, with slight boosts from Monterey and Wood Colony.  Nonpareil is obviously in its “on-year” in most regions and Wood Colony is bouncing back from the 2018 frost.  All four varieties are benefiting from acreage growth, which is the key to this year’s larger crop.  Butte/Padre and Carmel continue a long-term decline due to acreage trends.

With the final crop ending up outside of NASS’ objective’s 80% interval, 2 years back to back, the crop receipts raise questions about the objective’s accuracy.  Good job again by the growers on another accurate Subjective estimate of 2.50 billion lbs.

REVIEW:

December shipments were a new record and on the high end of expectations.

Decembers sales were 166 vs. 179 million lbs. last December.

Committed (Unshipped) reached 610 million lbs., up 7% from a year ago.  Uncommitted Inventory is 994.9 million lbs., up 6% from a year ago.

Sold Position:  If we have a 2.5 billion lb. crop, the industry is approximately 60% sold on total supply, similar to a year ago.

The Japan Free Trade Agreement went into effect January 1, bringing the small duty for shelled almonds down to zero.  Duties on almond meal and paste will be phased out.

China Trade:  The Phase 1  agreement will be signed January 15.  Once this is signed the Almond Board will be reviewing details and we hope to learn more about any specific news for our industry.

Nonpareil Market:  This is the first One Billion Pound Nonpareil crop.  So far Nonpareil/Independence receipts are up 182 million lbs. vs. a year ago, essentially equivalent to the entire growth in supply.  There has been a considerable compression in variety values over the past several years.  The outlook for this variety is not as rosy as some of the small Cals which are now evident to be down this season.  However, a few positive points on the questionable Nonpareil market:  NP Carry-in appeared to be significantly lower than the carry-in into the 2018 crop, Independence is replacing CM Type and Cal demand in addition to NP demand, with the reduced spread between varieties we are seeing shifts back to buying more NP in the Middle East and other regions.  Also, Quality Matters:  Good brands of Good quality Nonpareil seem to be holding stronger than the low-end Nonpareil supply.

Weather:  We hope for more rain and chill hours, so the trees get more rest before bloom.  The recent fog has giving growers additional weather opportunities for mummy shaking.

Feel free to call or email for further discussions.

Paul Ewing    Dennis Soares

Further info: December 2019 Position Report

January Position Report – Tuesday February 11, 2020