Bill Morecraft
Senior Vice President
December shipments for the California almond industry came in at a record 256.9 million lbs, nearly 25% greater than the previous record of 206 million lbs set last year. U.S. shipments were up 5.6% and 3.2 million lbs. Shipments to China were up 17.2 million lbs, India volume increased by 15.3 million lbs, and shipments to the EU were up 11 million lbs.
Year-To-Date, industry shipments are up 22.1% and 232.5 million lbs over last year in the first 5 months of the reporting year. There are strong increases in each major geography, except the Middle East, where California should see more business as we approach the buying season for Ramadan.
Notably, YTD shipments to China and India make up more than 60% of the gains so far this year. As activity in those markets seasonally taper, the pace of growth is likely to moderate.
Shipments to China are impressive with an YTD increase of 54% or 51 million pounds (including Vietnam). Shipments to China in 2016, before the trade wars, were almost 170 million pounds for the year. The potential is evident for future years. India also continues to amaze with an increase of 79% or almost 100 million pounds. While the report shows strong shipments to India, as a result of the logistical nightmare all are experiencing, perhaps 35% or more of this tonnage has not yet reached the destination. This has shielded India from heavy arrivals of product all at once thereby keeping the demand in the market strong. This may start to change as the heavy shipment periods are coming to an end with more product arriving. However, with the almond now known as the immunity nut along with continued growth in the industry as a result of the generalization of taxes nationwide, almonds are becoming more popular in regions of the country where one would be hard pressed to find almonds a few years ago. For the remainder of this crop year both China and India will also look to Australia to meet their demands.
New commitments for December were 172.6 million lbs. Year-To-Date commitments continue well ahead of prior year, up 311 million lbs and 51%. The outlook for January is again for strong shipments relative to previous years.
December receipts of 455 million lbs bring the 2020 crop to 2.868 billion lbs. The 2020 crop will likely surpass the 3.0 billion lb original estimates by a modest amount on January forward receipts.
Prices, bolstered by the strong demand pull, have increased by $.10-$.15 through December and early January.
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Market Perspective With a 2020 crop just above 3.0 billion lbs, the 2020 supply is now 64% committed. The first five months have demonstrated phenomenal growth of 22% in shipments and 50% in outstanding commitments over the prior year. Even with the explosive growth, 1.2 billion lbs remain in uncommitted shipments. The key over the back half of the year will be the ongoing pace of year-over-year growth in shipments and commitments even as we begin to evaluate the 2021 bloom.
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