Friday March 30 2012
Volume: 40 Issue: 13
California is by far the biggest producer and exporter of almonds and effectively makes the market. This year has been marked by less dramatic price fluctuations, particularly for the Non Pareil grade, popular for snacking use, which had good availability in the 2011 crop.
We could be heading for a traditional peak in prices moving into the second half of the season, which often happens in spring as uncommitted supplies decrease and shippers behave cautiously until they have a more precise idea of crop size. However, priced at little more than half the level of walnuts, for example, almonds still represent very good value within the tree nuts market, and will continue to do so even if they gain a few cents between here and the summer.
As for the the supply situation, the bloom in March happened without adverse events, and although the dry climate over the winter has been noted, nothing has yet given undue concern for 2012 production.
California is tending towards 2.0 billion pound – and larger – crops, with 13 362 acres of plantings still non-bearing in 2010. But can demand keep pace to support current prices? So far, the answer appears to be yes. For the first seven months of the season, shipments registered a 13% increase. Looking back a little, California has shipped 6-18% more each year, for the last four years. During that period, the only time the increase went into single figures was after a significantly shorter crop (-12%), in 2009/10.
All the signs currently seem to point to stable or slightly rising prices if another good crop materialises. If the crop is short, however, significant price hikes could be seen. For the time being, the almond market seems to have been resilient even in the face of economic downturn in its important export market, Europe, buoyed by continuing strong shipments to Asia, especially China and Hong Kong, the Middle East and other regions. Given the groundwork the Californian industry has done, backed with significant investments, to create strong consumer demand in numerous regions of the world, there is every reason to believe good increments in yearly shipments can be sustained.