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Statement on Salmonella and Food Safety
5/24/04 Billion
Pound Crop Estimate 7/1/03
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PERFECT 1B!
A “Perfect 1B”
I think best describes the
current bloom situation. Early frosts and periods of both heavy and
light rains intermingled with sunny days have united to form what I
consider the ideal scenario for California’s almond industry. Pre-bloom conditions had almond sellers faced with sharp price declines due to almond buyers strongly resisting the market prices and the threat of a large fresh supply coming in 2006. Buyers took the position that the almond crop could reach as high as 1.2 billion pounds for 2006, a 33% percent increase over 2005. If this came to bear, prices could fall further, leaving those with inventory facing large losses. This resulted in buyers being very cautious so as not to be the one left “holding the bag”. Then Mother Nature stepped in. First, warm temperatures in late January, early February convinced the trees that spring was upon us and they started to bloom! Bloom was very prevalent even in the first week of February, almost 14 days earlier than normal. Although daytime temperatures were very warm, nighttime temperature were low, often in the 30’s so bloom did not progress very quickly. Growers’ fear of frost was also soon realized, as mid-February brought over a week’s worth of freezing temperature, causing serious damage to the early blooming varieties and some damage to virtually all varieties. But Jack Frost was not enough; Mother Nature also sent us rain! Just as Nonpareil/California varieties hit peak bloom, we had a couple of rain showers, then nice warm nights and days prompted the later varieties to blossom and they were rewarded with a severe rain shower. This pattern of a nice day or two and then rain still continues today. Also, the threat of frost is still very real and remains until the end of March. So how does this translate into a “perfect” scenario? With the upper “potential” of the 2006 crop removed I am estimating the crop to be right at one billion pounds. This should allow for prices to settle at a range where buyers are comfortable buying. This also provides an adequate amount to supply a quantity greater than current shipments (depressed due to the $3.00 – 4.00 plus prices during late 2005), which is necessary for a smoother transition into the larger crops that will inevitably be harvested in 2007-2010. The key to selling the larger crops to come is convincing large end-users of almonds to stick with almonds as an ingredient as we will have an adequate supply at a reasonable price; one billion pounds in 2006 will do that, without causing the market crash to price levels below the cost of production. Best Regards, Gerrit Dorrepaal Chief Financial Officer Hilltop Ranch, Inc. ©2006 Hilltop Ranch, Inc. |
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