The Almond Board released the December position report for the 2018 crop today. Crop receipts are flat vs. the same time a year ago, indicating the crop may not be much larger than 2.26, equal to last year, no indication of being larger. It appears the freeze of last February did have an impact as thought.
Shipments: December shipments were 199.6 Billion, -2.4 % below the previous year. Export shipments were also off -3.5%, 146.22 million pounds. The industry is only slightly behind shipments of LYTD -3.01% having shipped 1.007 billion pounds. We saw pricing rise significantly in November and December as a result. This will have an effect in bringing demand more into line with supply.
Year to Date Shipment Summary:
- US: +0.8 % – December was another record shipping month for Domestic sales at 53.38 million.
- North America: +9.0% – Reflecting positive shipment increases for Mexico +6% and Canada +11%.
- Asia-Pacific: -5% – India continued to decline this month -7.0% versus same time last year, following strong Sept/Oct shipments. However, the market remains uncovered and will see strengthening in the next few months. Japan was down -3% and South Korea is up +4%. China/Hong Kong -14% and countered by Vietnam +14%.
- Europe: -6% – Remains trailing behind a year ago. Rising prices in November and packers being full led to this.
- Middle East: -5% – UAE rebounded up +6% YTD, along with Saudi Arabia +53% and North Africa +343%. Turkey continues to struggle; however, they are trending up versus the previous month.
Commitments: Uncommitted Inventory is up +4.32% with 941,048,802 versus 902,072,579 last year. Commitments are off -8.5% with 568,667,907 versus last year’s 621,519,065. With the wait and see, purchasing hand to mouth and short term contract purchasing, this should be no surprise. Having said that, committed shipments are trending up as would be expected and coming into line with the supply we appear to now have in hand.
Market Outlook: With crop receipts flat, the prospect of increased supply has disappeared for this crop year. Should demand continue unchecked as it did last year, expect to see firming prices continue through the bloom period and going forward. With virtually the same crop size as last year coupled with a smaller carry in, the industry will not be able to grow consumption this year. We continue to sell into the bloom with the understanding we will not see the 2019 crop for seven more months. This will be reflected in pricing levels throughout the market. Until post-harvest and processing of the 2019 crop occurs we will see similar conditions to last year with specific sizes and varieties being harder to find during the July, August and September time period.
The trade talks with China continue and appear to be headed in the right direction although nothing has been settled. It may have been to the betterment of the industry for this to have occurred this year considering our overall supply.
Next shipment report: February 12, 2019
- 2017 Final shipments of 2,251 Billion left a carry-out of 359 million pounds.
- 2018 objective estimate of 2.45 billion means 2,290 lbs. per acre. This is no longer feasible.
- Only a difference of 178 lbs. (-7.4%) yield per acre effects the total crop by 200 million pounds.
- 2019 Yield per acre: Scenario A based on 2017 actual, B based on 2018 estimate, C based on best yield historically.
- Shipments for 2019 is based on a 12% increase over 2017/2018 crop years allowing for double digit growth attributed to historical trends.