The preliminary forecast for an 8.5 percent larger California almond crop this year than last year doesn’t support higher almond prices, but the state’s packers say the market should be able to move the 1.53 billion pounds of nuts growers are predicted to harvest starting in August.
The California Agricultural Statistics Service puts bearing acreage for this year at 740,000 — 20,000 more than in 2009. The predictions are based on the opinions of 317 growers, representing 28 percent of the total bearing acreage, who participated in a telephone survey.
The estimate is a little larger than many observers predicted at the end of almond bloom, says Keith Rigg, general manager of Minturn Nut Co., Inc., Le Grand, Calif. “A 1.53 billion-pound crop isn’t a burden, however” he says. “With the light carry-in this year, we should be able to market the 2010 crop in an orderly manner.”
Kelly Burkholder, sales manager for Harris-Woolf Almonds, Coalinga, Calif., says, “A crop of 1.53 billion pounds is on the higher side of expectations, but it’s not a problem to move at the right price level. The total available supply is very similar to what we had last year, and we’ve shown that we can move a crop of that size.”
Despite last year’s large crop and equally significant carry-in, demand increased strongly, Burkholder says. But, many of the purchases, including forward contracts, were made early and at low prices. In fact, the average price paid by buyers was about $1 lower than spot prices a month ago. “So, the market may be telling us that it can’t sustain those demand levels at the higher prices,” he reasons. “But, that’s just my guess.”
Right now, the weak global economy accounts for most of the recent weakening in almond prices, Rigg says. “What’s hurting prices more than this minor increase in perception of this year’s crop size is lack of demand.
“People around the world are very nervous about the economy. Europe is concerned about its economic health, the Chinese economy has slowed, and the dollar has strengthened against the Euro — all factors contributing much to the downturn in almond prices.
“If buyers come back and start buying again, that should shore up prices and help stabilize the market. But, if the buyers stay away, the market will stay weak.”
The initial 2010 California crop forecast estimates an average almond yield of 2,070 pounds per acre. That compares to last year’s revised yield of 1,960 pounds.