At the beginning of the year, Peter Jelavich, Yuba City, Calif., was very concerned about the walnut market. Now, the grower/director of the Walnut Bargaining Association is fairly optimistic.
“It’s amazing what has happened to the market in just the last three months,” he says. “It has completely turned around.”
Five months ago handlers were selling light nut meats for $1.75 to $2 a pound; now, the price is $2.20 to $2.25.
This price rise has been accompanied by a remarkable increase in movement of walnuts. In March, handlers sold 38,000 tons of product, about 72 percent more than the 22,000 tons in March last year. In April, movement increased again, totaling more than 40,000 tons, almost double the April, 2008 movement.
In tracing the recent history of the walnut market, Jelavich notes that last September a pound of nut meats was selling for $3.50 before tumbling along with the worldwide drop-off in economic activity.
Movement of walnuts from September, 2008, through last January was much lower than year-earlier figures. He says prices of walnuts bottomed out this past January or February before starting to pick up in March.
Assuming the increased movements continue, he doubts that much product will be left over from year’s harvest.
“In fact, some handlers are concerned about having enough walnuts to get to harvest,” Jelavich says. “Inventories of light product are getting down to the bottom, and I don’t’ think handlers will have enough to last through the next few months. Now, they are switching to combo product and those prices have started picking since mid-May.”
Because the previous year’s carryover going into harvest was the lowest in 20 years in 2008, he expects a higher carryover this harvest season. “The carryover of the 2008 inventory to the new crop will be very manageable going forward, and I expect walnut prices will continue to firm slowly and work their way back up, Jelavich says. “That’s healthy.
“The current strengthening of walnut prices could also bolster payments growers receive for last year’s crop. The price per pound of 2008 in-shell walnuts could move up another 10 cents as a result of what’s happening in the market now.”