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Quality at Mt. Satake,
Jan. 2007 Statement on Salmonella and Food Safety
5/24/04 Billion
Pound Crop Estimate 7/1/03
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FEBRUARY
2007 This year we had the freeze early, while the trees were dormant, setting up a regularly scheduled bloom with warmer temperatures. The recent rain will definitely reduce the (Nonpareil) crop from maximum potential, but the overall crop will almost certainly be larger than in 2006, unless current weather forecasts are incorrect and the Butte/Padre varieties get significant rain. Frost is still a concern until the end of March. So, does that mean prices should come tumbling down? No, record shipments have moved a large part of the 2006 crop and all indications are that the rest (down to a minimal carryout) will be shipped or sold by July 31. Even if there is a bumper crop set this bloom, those nuts won’t be available until mid to late August. What about 2007 potential? With the Nonpareil trees coming off a record year and the recent rains, odds are Nonpareil yields will be lower, Butte/Padre will likely be up, although their bloom is just starting in some areas. Overall, this leads to a scenario where the crop may be up 10-15% maximum over 2006, most likely 5-10% larger. Growers should welcome this, because the only way we can continue to set record shipments is with a record crop! Now on to the market mentality. It seems over the past few years buyers and sellers were acting like adversaries. Buyers seemed gleeful when almonds were below a dollar a pound, even going below the cost of production. Many seemingly didn’t care if that would put some growers out of business. The low prices coupled with the health benefits of almonds led to a demand explosion and the highest prices ever seen. Now sellers became the greedy ones, “$3.50 is not enough”, some sellers thought. “lets see if we can squeeze $4.00 out of our buyers”. All good things must end, and the market dropped sooner and faster than most sellers expected. The players in the market need to come to the realization that everybody is important, and all need to make a fair profit. This doesn’t happen at $1.00 per pound, and it doesn’t happen at $4.00 per pound. Maybe experience does sink in, because the 2006 crop was marketed in a much more responsible manner (although many may argue it was accidental). The crop started out under-priced, but with some sellers slowly feeding the market, it eventually gained strength and momentum. Buyers weren’t afraid to buy, as prices were not likely to be lower tomorrow. The industry was rewarded with record-breaking shipments at FAIR prices. As close to a win-win situation as can happen in this industry. So now all we need to do is repeat what we did with the 2006 crop in 2007. Fair prices for both the seller and the buyer, and record shipments. EASY ENOUGH! Best regards, Gerrit DorrepaalChief Financial Officer Hilltop Ranch, Inc. For more information, contact Gerrit Dorrepaal directly. Previous Market Reports: ©2007 Hilltop Ranch, Inc. |
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