Almond Market Update – March 2023
The Almond Board of California released the February 2023 position report:
Shipments were a Record 245.7 million lbs. vs. 199.2 in 2022 – UP 23.4% for the month and bringing YTD to 5.5% UP
DEMAND
U.S. +7.6% (-5.5% YTD)
Exports +29.2% (+10.4% YTD)
Western Europe -20% (+4% YTD)
India +69% (+5% YTD)
Middle East / Africa +98% (+69% YTD)
China / Hong Kong/ Vietnam +273% (-3% YTD)
Japan -17% (-17% YTD)
South Korea +31% (-35% YTD)
Canada +18% (-8% YTD)
Central / Eastern Europe +20% (+15% YTD)
Latin America / Caribbean +1% (-3% YTD)
REVIEW
February Shipments – Industry members were once again optimistic, and the figure came in on the high side of expectations for the third month in a row.
February Sales were 190 million lbs. vs. 215 million lbs. in February 2022 – a solid sales month but not as impressive as shipments. This isn’t surprising, since sellers pulled back from offering late in the month due to weather concerns.
Committed (Unshipped) stood at 785 million lbs. – 8.5% below last year’s 857 million lbs.
Sold / Shipped Combined was 2.3 billion lbs. – just slightly above a year ago.
The Industry Sold Position, using a crop of 2.55 Billion lbs., was 69% of total supply – up from 66% a year ago.
2022 CROP
February 2023 Receipts were 47.9 million lbs. vs. 64.4 million lbs. in February 2022. Crop receipts so far are tracking down 12.8% vs. last year. If the crop finalizes around 2.55 Billion lbs., this will be 50 million lbs. short of the Objective Estimate, 250 million lbs. short of the Subjective Estimate, and 370+ million lbs. short of the 2021 crop.
2023 CROP
We have experienced heavy amounts of rain, wind, cold, and even snow on parts of the valley floor.
We spoke with Gene Brandi, a commercial beekeeper and former President of the American Beekeeping Federation. He noted on this bloom “The bees were starting to pull in a little nectar and pollen prior to February 21st, before it got cold, and the wind picked up. It was a very watery nectar, not much sugar in it. Then we had an 8.5 to 9 day period where the bees didn’t really fly. In most years, we get 2-to-3-day periods like that, but I cannot remember any stretch this long where the bees didn’t fly, and I’ve been bringing bees to almonds for over 50 years. We had to feed the bees more than usual this year.” Beyond the concern about lack of bee activity, Gene pointed out that setting an almond crop is a two-step process (pollination and fertilization) and conditions were very poor for both steps this year. “Once the pollen is on the stigma of the flower, it needs to germinate and grow a pollen tube all the way down to the ovary to fertilize the egg in order to set a nut. If the weather is too cold, the pollen tube won’t grow. 60 Degrees Fahrenheit or better is ideal, and while a pollen tube will grow when the temperature is in the 50’s, the colder it gets the slower it will grow. Not only did we experience a loss of bee flight but pollen tube growth was likely impacted because of the cold weather.” As we spoke on March 7 he added “the bees have been collecting a little bit of pollen in the last few days since the weather got better, so there is some late pollination occurring, but peak bloom is over for most varieties.” In most areas and for most varieties, peak bloom occurred during the 8.5 to 9 day spell of very poor pollination weather.
Bee Hours: The SEMIOS Data shows the following:
If we take the bee hours for the Mid Valley for example, as of yesterday March 8, they were down 48% from last year. Even with bee hours down significantly, great crops can be set. What we think is unique about this season, as demonstrated in the above charts, is the periods of time where bee flight did and did not occur. The above charts seem to demonstrate the roughly 8.5 to 9 day period that Gene Brandi referred to, and this period was right during the peak of bloom for most orchards.
We believe the 2023 crop yields will be highly varied between regions and varieties, because of the extreme weather. Those varieties and regions that had more bloom outside of the long period of no bee flight, should fare significantly better. Self-compatible varieties should fare better as well. We are very concerned about the crop size, but it is far too early to make any certain judgements.
Buying Activity
China’s heavy buying activity is starting to show with this month’s report. Historically at other times of very low prices, they have come in and bought up large volumes and helped correct the supply/demand imbalance.
India showed another very strong report. Some buyers there have been more cautious in recent weeks, given good volumes of purchases at the low prices, but others have continued buying. Regardless, this market has more buying to do.
The U.S. Retail – promotions and discounts have continued. Shipments are finally improving domestically.
Europe took a breather following a very strong January.
The Middle East and North Africa continue to buy heavily because of the very low prices.
OUTLOOK
With recent improved months of sales and shipments, the industry’s carry out concerns have lessened in recent weeks. We believe the partial recovery in pricing is due to the outlook on these current crop fundamentals and has less to do with the 2023 crop concerns. If some of the 2023 crop concerns prove true, there seems to be considerably more upside to pricing. On the flip side, the industry is cautious about sales slowing down too much and for too long.
Best regards,
Paul Ewing Dennis Soares
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March Position Report – Tuesday April 11, 2023