Almond Board Industry Position Report: April 2016
The Almond Board of California’s Position Report highlighted a brisk movement of 167.5 million pounds shipped in April. This is a record shipment level for the month of April and is 11% above the amount shipped in April 2015. Export shipments increased by 26%, reflecting willingness in international markets to move strong volumes at current prices. Domestic shipments were off by 13% compared to 2015, due to current retail prices reflecting purchases earlier in the marketing campaign at much higher values. Once this high-priced inventory clears and is replaced with more attractive consumer pricing, volumes will accelerate following a similar pattern seen in the export market.
Total crop received for 2015 has settled in at 1.891 billion pounds. This is likely to be the final total for the 2015 crop as most receiving data has been accounted for by the Almond Board.
Sales commitments in April jumped by 177 million pounds, an 18% increase, to 432 million pounds. As a result, to date, uncommitted inventory stands at 476 million pounds, below the 500 million pound threshold, which previous industry predictions had established for the end of the marketing year. Given the new data, current forecasts set the carryout in the range of 440 to 480 million pounds.
It is predicted that export shipments in May will be robust as China, India, and the Middle East are showing good long-term signs of recovery. European market shipments are up 6% compared to this same time last year with good increases due to a short Spanish crop, reportedly down 11%.
NASS Subjective Forecast
The USDA’s National Agricultural Statistics Service (NASS) recently released their 2016 Subjective Estimate for the new crop of 2.0 billion pounds. This is based on their estimate of 900,000 bearing acres, and a forecasted average yield of 2,220 pounds per acre. The 2.0 billion pound estimate is shorter than many recent industry predictions and has contributed to better near-term market conditions by instilling confidence regarding potential production.
Market Perspective
With continued strong shipments and the release of a lower than expected 2.0 billion pound NASS Subjective Estimate, the industry expects to see better market conditions in the coming weeks. Over the past 12 months, almond prices have peaked, then declined and are beginning to show a moderate rebound as prices settle into more familiar, historical levels. Demand is starting to grow as a result of price moderation and confidence in the market. Export demand has responded quickly to these favorable conditions and growth in North American volumes is expected to follow suit. Overall, the market is reflecting a better balance of supply and demand.