Bill Morecraft
Senior Vice President
After a dip in January shipments, the California almond industry resumed a strong growth pace in February, shipping 234 million lbs, up 32 million lbs and 16% from last year. YTD shipments remain 16% ahead of last year through seven months, up by 239 million lbs. Once again, significant export volume awaiting containers and rescheduled vessels were delayed and the shipments will be pushed into forward months. Shipping constraints are likely to last for several more months.
Through seven months of the crop year, YTD growth over last year was driven primarily by increases of 27 million lbs in the U.S., 56 million lbs in China, 87 million lbs in India, and 37 million lbs in Europe.
New commitments were 189 million lbs, keeping 2020 crop commitments well ahead of last year. Commitments of 887 million lbs exceed last year’s total by 298 million lbs, up by 50%. At the end of February, shipments and commitments equaling ~75% of the total supply are comparable to sold position in most years.
Receipts reached 3.087 billion and appear headed to crest 3.1 billion in the remaining months.
The large commitments indicate that there will be greater than average back half growth needed to reach manageable carry-out inventory levels. While the 2020 crop carry-out will likely grow above 700 million lbs as stated last month, it will be coupled with a smaller 2021 crop resulting in a supply that is likely comparable to this year.
With the 2021 crop in post bloom, expectations remain for a crop closer to a high of 2.8 billion lbs as the North and Central areas come off their record 2020 yields. Through March, the last few weeks of uncertain weather will unfold and by early April more definitive outlooks on the size of the 2021 crop will begin to firm up.
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Market Perspective Not much has changed since last month’s observations: The industry remains well booked into future months with buyers taking advantage of attractively priced almonds over the first months of the 2020 crop year. With large commitments on the books, shipments should remain strong in future months. West Coast vessel delays will continue to stress shipments in the short term, potentially confusing month to month export demand in the months ahead. March 2020 represented the beginning of shipment abnormalities in the 2020 crop due to Covid-19; this will also make month-to-month comparisons more difficult to decipher, especially in the Domestic market. With the crop nearing 3.1 Billion lbs, California will look to reduce inventory levels to a carry-in level that coupled with a smaller crop will yield a similar supply as in 2020. |
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