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Statement on Salmonella and Food Safety
5/24/04 Billion
Pound Crop Estimate 7/1/03
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Lately market seems to have been driven largely by growers. Many of the 6,000 plus almond growers in California are very reluctant to sell to processors for two major reasons –they’re relatively financially strong and the market is rising. After two years of rising prices and improving grower returns, they are more financially sound and thus able to be more patient in selling. If an average call pool grower for example commits just half of their crop for the coming year, they are already set up to receive the same total dollar return as they did just two years ago. Thus, many look at the remaining half of the crop as a “bonus.” These growers are waiting to get a better idea of how their crop looks and how high the market will go before they commit any additional tonnage. A look at supply situation over past two years and estimate for this year: 2002 Crop Carry In 81 Million Lbs. Receipts (Net) 1063 (1083 Gross) Total Supply 1144 Shipments 982 Carry Out 162 2003 Crop Carry In 162 Receipts (Net) 992 Total Supply 1154 (1033 Gross) Shipments 1024 Carry Out 130 2004 Crop - Estimates Carry In 130 Receipts (Net) 1037 (1080 Gross) Total Supply 1166 Shipments 1050 Carry Out 116 The almond market historically has gotten overdone at times. Prices are so high now that we would expect to see demand falling off in some markets. The retail sector seems to be the first place demand falls off, though almonds are still the cheapest nut. Markets where food manufacturers are using almonds as an ingredient are more price inelastic, hence the last ones where demand decreases. Current prices should be at least high enough to keep shipments from growing too fast and to achieve a similar supply scenario to that estimated above. Any less carry out would not be good for the industry. The Nonpareil new crop is looking excellent. While ant damage has been reported from some in the southern part of the valley, overall the crop has much less serious damage than last year. It appears the Nonpareil kernels grew away from their shells, allowing for less chipping and scratching in the shelling process. Older orchards are coming in with similar tonnage to last year; newer orchards have produced quite well. With the major inconsistency in production among regions of the Central Valley and among new and old orchards, it’s still difficult to estimate the nonpareil production. The trees are very healthy and should produce a good sized crop in 2005, assuming decent bloom conditions. More young trees won’t really kick in until 2006, so we will likely face one more year of tight supply. We look forward to having the much needed increase in supply to allow more room for market growth and hopefully more stable pricing. Growers are certainly interested in increasing production with these prices – tree nurseries throughout California are sold out of almond trees through the start of 2006! Best Regards, Paul Ewing Director of Sales Hilltop Ranch, Inc. For more information, contact Paul Ewing directly. ©2004 Hilltop Ranch, Inc. |
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