California’s pistachio growers are giddy these days — not only did they harvest their biggest crop and highest yields in history this past fall, but the prices they received have never been higher.

“The size of the 2010 pistachio crop caught everyone by surprise,” says Richard Matoian, executive director of the Western Pistachio Association. “Even people who walk the orchards each and every day were. As late as one month before harvest, most observers were estimating total production at about 330 to 350-million-pounds.”

But, by the time the last of the nuts were in the bins, the total weight of the crop topped out at 521 million pounds — 45 percent higher than expectations. Add in pistachios harvested in Arizona and New Mexico and U.S. growers produced 529 million pounds in 2010.

The average California yield will come in around 3,800 pounds per acre — exceeding the previous record average yield of 3,729 pounds per acre set in 2004.

So, what happened?

“I’ve heard various explanations,” Matoian says. “Apparently, the cool, wet spring weather caused the trees to produce larger nuts. Growers responded to all the early spring rains by being more diligent in controlling Botryosphaeria and other mold and rot diseases. Also, some think that since 2009 was an on-year, but production wasn’t as high as usual, maybe the trees were able to rest a little and increase production in 2010, a projected off-year.”

In addition to the number of nuts harvested, the 2010 crop was exceptional for quality.

Typically, when production rises, quality can suffer. Not last year. Unlike a normal season, when most California pistachios range in size from 21 to 25 nuts per ounce, a larger percentage came in one size larger — in the 18/20 category, Matoian says.

Meanwhile, insect damage, another measure of crop quality, was way down. Processors usually expect as much as 4 percent to 5 percent of the nuts showing navel orangeworm damage. For 2010, they reported less than 1 percent damage in many cases.

“Also, there’s a direct correlation between the amount of navel orangeworm damage in pistachios and the incidence of aflatoxin,” Matoian says. “Since damage from that insect has been low, the threat of aflatoxin should also be extremely low. That’s especially important when shipping pistachios to the European market, which rejects shipments containing the toxin.”

The surprising prices for 2010 pistachios reflect the pre-harvest expectations of processors for a smaller crop. That estimate is one of the factors processors use in setting the price they offer growers for delivery of nuts.

Normally, contracts are signed about a month before harvest. As usual, that’s what happened last fall, when processors offered growers about 25 percent more for their pistachios than a year earlier. Now, processors are facing the challenge of marketing more nuts than they anticipated at a high price.

To do that, they may have to accept a lower margin, or they may be able to find more outlets for the extra nuts. It’s too early to tell, how things will play out, Matoian says.

“To take up the additional 2010 production, shipment numbers will have to continue at high levels this year. So far, demand for California pistachios continues to be high and shipments through the end of 2010 were good.”

The 2010 crop highlights the value of accurate crop estimates, Matoian says. “Right now, the industry is talking about how to improve practices for estimating production to give everyone a better idea of crop size before harvest.”