Blue Diamond Almonds – January Market Update

January 13th, 2016



Bill Morecraft
Senior Vice President

Overview –

There has been significant turbulence in the California almond industry and customer base since September.

The December Almond Board Position Report reveals the second uptick in the projected 2015 crop since October. The 2015 crop now projects to 1.9 billion lbs or more. The light YTD receipts reported through October had more to do with bottlenecks in processing and storage produced by a rapid harvest and light early shipments, than with a smaller crop size.

For eight consecutive months, shipments of California almonds have declined from the same month in the prior year. Through August, pricing rose steadily as suppliers guarded against the potential for a second year of significant drought-induced decline in production.

The repeated drops in pricing since August mirror the increasing divergence of projected supply and projected shipments. Five months into the ABC year, shipments trail last year by 6% in the U.S. and 14.5% combined in export markets. Meanwhile, the 2015 supply has moved in the opposite direction, increasing by 2-3% over last year. The increasing projected supply and the declining prices have generated a trail of difficulties throughout the supply chain.

January should bring the first month of year-over-year increased shipments since April 2014. Last January, shipments were limited to 115 million lbs by the west coast port congestion issues. It remains to be seen how much second half demand recovers with prices reaching more moderate levels. Almond prices are returning to ranges that represent a better value for ingredient users. This is exactly what is needed as larger crops are projected in the upcoming years.

With bloom approaching, we will understand within a few weeks if El Nino can again shift the perception of supply and demand balance. Regardless of the outcome, it is time for the California industry to return to building global demand for almonds.

Jan Market Perspective

Click here to view the entire detailed Position Report from the Almond Board of California site: