The Almond Board released the October position report for the 2018 crop today. Receipts have not caught up the previous year at this time, -0.82%, which may indicate a crop less than the expected 2.45 billion pounds. Shipments: October shipments matched last year’s shipment, actually slightly above reaching 247.1 +0.3%. The industry is still behind in shipments versus last year by -35.45 million pounds, but showing positive signs. This continues to be reminiscent of last year at this time. Expect to see the continued strong shipments thru the remainder of 2018. Most packers are fully booked for November and December production at this point.
Year to date shipments summary:
- US: +6.7 % – Domestic market remains strong, business as usual. Expect to see increases ahead.
- North America: +7.0% – Reflecting positive shipment increases to Mexico, +12% and Canada +13%.
- Asia-Pacific: – 5% – India still trends up +3.0% versus same time last year, as well as South Korea is up 24%. China / Hong Kong / Vietnam remains off -31% reflecting tariff uncertainty and boarder closures. Japan also reflecting a – 4%.
- Europe: -16% – Europe has started to come back. Last month it reflected -32%. But Germany is off by -35% and Spain is off -10%.
- Middle East: -39.0% – UAE off -44% YTD, Turkey is off -66%. Expectations leave the Middle East off this year. It will be difficult with all the issues throughout the region for it to come back to -25% for the year.
Commitments: The industry remains undersold versus same time last year. Total 2018 committed shipments jumped this month from 557 Million -23% last month to 586 million -13.32% to date.
Market Outlook: The market is starting to take more form now as business is getting done at market levels that are good for all parties. Given the later crop, shipments are starting to catch up. It is thought widely that the crop will not reach the 2.45 billion but maybe closer to a 2.35 billion pounds. Given the unsettled trade war with China, this is probably a good thing. Additionally, the USD strength versus the other currencies continues to add pressure.
We will continue to sell into the bloom. With favorable weather and expectations of an even bigger crop coming, prices should remain stable through the crop year. I still suspect that particular sizes and varieties may become harder to find as we get latter into the crop year. Thus we are continuing to see pricing differentials between Nonpareil and the other California varieties closer than historically seen. As stated, demand for November and December is looking very strong. Business should remain consistent and growth will match supply for the foreseeable future.
Next shipment report: December 11, 2018