The Almond Board released the September position report for the 2018 crop today. Receipts are off versus same time last year by -1.29%, which may not seem like much if not for the estimate stating a much larger crop coming…logic indicates we should be receiving more tonnage as a result.
Shipments: September shipments trail last year’s shipments by 21.73 million pounds. Additionally, for the new crop year this puts the industry behind by -36 million pounds YTD versus this same time period last year. This mirrors the first two months of last year as well. If we follow the same pattern as we did last year, from October thru April each month was a record shipment month. Will we repeat?
Year to date shipments summary:
- US: -0.7 % – Domestic market remains strong, business as usual. Expect to see increases ahead.
- North America: +8.0% – Reflecting positive shipment increases to Mexico, +19% and Canada +4%.
- Asia-Pacific: -6% – India remains up +10% versus same time last year, as well as South Korea is up 24%. China / Hong Kong / Vietnam is off -39% reflecting tariff uncertainty and boarder closures. Japan also reflecting a – 17%.
- 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: -51.0% – UAE off -55% YTD, Turkey is off -78%. With the lira in disarray, sanctions in effect against Iran and general disruption in trade across most of the Middle East, we may see this continue for some time.
Commitments: The industry remains undersold versus same time last year. Total 2018 committed shipments of 557 Million -23% to last year’s 722 million pounds
Market Outlook: The commitments are reflecting both the buyer’s uncertainty/unwillingness to purchase out in advance and seller’s unwillingness to sell too far out. The grower is not confident in the supply, at this point receipts should be higher than where they are. Even given the later crop, this would indicate a supply well below the 2.45 billion estimated, and perhaps closer to 2.30 billion pounds leaving a sellable crop closer to the 2017 crop year with no room for growth. Perhaps it is good timing for Asia to be off.
The harvest is almost complete. Reports are describing Nonpareil off and kernels smaller, but to what degree is only speculation, as it is early in the processing timeline. Quality appears to be better than last year. The pollinizers are also said to be off versus last year, thus far the Carmel is indicating high doubles once more, but S.D. is lower so perhaps in the end all ends well.
Demand for October and November is looking very strong. Pricing is matching demand very well at the current market levels we are seeing today. Business should remain bullish for the foreseeable future.
Next shipment report: November 09, 2018
Download full PDF report here.