Almond Market Update – May 2021
The Almond Board of California released the April 2021 position report
Shipments: 249.9 million lbs. vs. 181.2 million in 2020 – +37.9% for the month & +19.6% YTD
U.S. -9.8% (+1.96% YTD)
Exports +73.8% (+27.8% YTD)
Western Europe +31% (+14% YTD)
India +230% (+57% YTD)
Middle East / Africa +190% (+20% YTD)
China / Hong Kong/ Vietnam +363% (+74% YTD)
Japan -4% (-6% YTD)
South Korea +87% (+45% YTD)
Canada +14% (-3% YTD)
Central / Eastern Europe +85% (+38% YTD)
Latin America / Caribbean +15% (+69% YTD)
Crop receipts of 3.098 billion lbs. remain up 22% from a year ago.
The drought has worsened and will impact the 2021 crop and beyond. California’s governor expanded the drought emergency declaration to 41 counties. The water cost in many federal water districts (as high as $2500 per acre foot) is making growing almonds not economically viable at prices anywhere near current levels. This is a challenging time for growers in many areas of the state.
Otherwise, the crop is developing well, and we look forward to the NASS subjective estimate tomorrow.
April Shipments – expectations initially were very high but many containers were rolled from April to May during the last 7-10 days of the month. Given all the rolling, this 38% increase overall and 74% increase in exports are even more impressive.
April Sales were 162 million lbs. vs. 125 million lbs. last April. Another strong sales month.
Committed (Unshipped) stood at 724 million lbs. – up 45% from last year’s 499 million lbs.
Sold / Shipped Combined reached 2.95 billion lbs. vs. 2.36 Billion a year ago, still up 25%.
The Industry Sold Position surpassed 84% of total supply – just above a year ago.
Consumers focus on health accelerated through the Covid-19 pandemic, which continues to bode well for almonds, especially in some key markets like India. Almonds continued to lead tree nuts in volume of new product introductions in 2020
Exports are carrying the weight this season, providing 354 Million lbs. of increased shipments so far. India has provided about 108 million lbs. of the growth, and just became the first export market to surpass 300 million lbs. shipped in a season, with 3 months still to go! China has been buying huge volumes as they generally do when prices are low. The Middle East was off to a slower start this season but is finishing very strong. South Korea and Central/Eastern Europe continue to impress. Western Europe shows double digit growth YTD and a very strong month, as almond snacking in the region continues to grow considerably.
The bearish talk of a 750 to 800 million lb. carry out has faded away with every month of strong shipments. History shows that betting against demand for California almonds is usually a losing bet. We could be on track for under 650 million lb. carry out so long as sellers continue to keep the peddle down and there are no big surprises.
Depending on the finish to this crop year and 2021 crop volume, we could be looking at only having room for mid-single digit growth for the coming season. Perhaps room for 5% growth instead of 20% growth. We will delve into these numbers more in the coming months as official crop estimates are released.
With sellers motivated to continue clearing out inventory, we believe current crop provides considerable value for buyers. Given all the logistics delays, buyers can secure current crop at slight discounts to new crop (for most items) and at the same time ensure a more likely arrival in time for the holidays. Additionally, the US Dollar is trading around the 3 year low point. Seller motivation and the tremendous value of current crop should continue to drive very strong shipments for the remainder of the season.
The Almond Board of Directors Election is underway. Results are due by early June. Ballots are due from Independent growers by May 27. Feel free to contact us to discuss any industry issues, the election, market etc.
Paul Ewing Dennis Soares
Subjective Forecast for 2021 Crop: Tomorrow, Wednesday, May 12
May Position Report – Thursday, June 10
June Position Report – Friday, July 9
Objective Forecast for 2021 Crop: Monday, July 12