Almond Market Update – July 2020

The Almond Board of California released the June 2020 position report  

Shipments:  175.4 million lbs. vs. 165.2 million in 2019 –  UP 6.2% (+3.9% YTD)  

DEMAND

U.S.  +2.4%  (+4.1% YTD)   

Exports  +8.2%  (+3.8% YTD)   

Western Europe -1% (+6% YTD)   

China/HK/Vietnam  -54% (-40% YTD)   

India +52% (+7% YTD)   

Middle East / Africa +90% (+36% YTD)    

Japan  -29% (+5% YTD) 

South Korea +47% (-4% YTD)   

Canada -28%  (-2% YTD)

Central / Eastern Europe +63% (+15% YTD)

2019 CROP

Crop Receipts per reporting to the Almond Board stand at 2.547 billion lbs. and per USDA at 2.546 billion lbs.  The two numbers are now much closer.

2020 CROP 

Everything continues developing well with no surprises.  We are entering a very hot spell with parts of the valley reaching 108 F (42 C) that could have some minor impacts on insect pressure and the developing crop.

REVIEW:

June Shipments were slightly toward the high side of expectations

June Sales of nearly 90 million lbs. were up slightly from last June’s 86

Committed (Unshipped) is 370 million lbs., up 31% from a year ago

Uncommitted Inventory is 252 million lbs., up 33% from a year ago

Sold Position:  The industry is approximately 91% sold on total supply, slightly down from a year ago.

OUTLOOK:

Certain items like high quality NPX in popular sizes along with certain straight counts and possibly inshell, seem tight.  It doesn’t feel like a huge carryout even though uncommitted is up.  It’s a positive thing that Nonpareil is running low first, since it’s harvest is approaching sooner than the pollinators.

Commitments point to strong shipments in the coming months, though COVID-19 contributes to unpredictability as to when commitments will ship.  Retail continues to perform very well while food service continues to struggle but is slowly recovering.  There are positive stories of the impact on consumption such as increased demand for chocolate with almonds in parts of the world.  Almonds have been mentioned in numerous Indian news articles regarding covid-19 and immunity boosting foods.

The 2019 Crop total supply grew by about 9% (crop up 12%), with pricing starting around $3/lb. shipments have grown by 4%.  We are going into the new season with total supply projected up 20% (crop up 18%), with almonds trading around $2/lb. (33% lower), and demand should grow significantly faster.  Adjusting for inflation, Nonpareil pricing is lower than the lows seen during the Great Recession (2008 crop year).  These are the cheapest Nonpareils in almost 20 years (adjusting for inflation).  Almonds are also sitting very low priced relative to other tree nuts.  Buyers can see the value, with new crop sales of 458 million lbs. vs. 231 million lbs. as of a year ago (almost double).  COVID-19 has made demand unpredictable, so buyers would have covered even more of their needs at this early stage if it weren’t for this wild card.  Time will tell if the pendulum swung too far to spur enough demand growth, or not enough.

A lot of Health News Recently: 

BBC’s list of Top 100 Most Nutritious Foods put Almonds as #1 (“After analysing more than 1,000 raw foods, researchers ranked the ingredients that provide the best balance of your daily nutritional requirements”)

UK Study:  Eating almonds may help improve the heart and nervous system’s response to mental stress

UK Study:  Eating almonds can improve vascular health

Best regards,

Paul Ewing    Dennis Soares

Further Info:  June 2020 Position Report

Upcoming News: 

July Position Report – Tuesday, August 11