California is still grappling with scorching triple-digit temperatures this week, making it challenging for almond farmers to harvest. The intense heat is drying out the almonds and limiting the hours available for harvesting. With the harvest in full swing, the 2024/25 crop outlook is beginning to unfold, but early indicators suggest that the yield may be smaller than expected—potentially even lower than the 2.8 billion-pound estimate many had initially dismissed.

Decreased Almond Production for the Third Consecutive Year

Last year’s almond crop receipts came in at 2.446 billion pounds, marking the third consecutive year of decreased production. This represented a nearly 5% drop from the previous year’s 2.571 billion-pound harvest. Despite this reduction, the industry had a carry-out of 800 million pounds, which helped meet demand. However, last year’s shipments of 2.692 billion pounds drastically reduced this year’s carry-out to around 451 million pounds—making it the smallest since 2020.

With supply and demand now more closely aligned, finding high-demand almonds has become increasingly difficult until the current harvest is completed.

2024/25 Crop Estimate: Smaller Than Initially Predicted

Prior to the release of the Objective Estimate, industry expectations for the 2024/25 crop ranged between 2.9 and 3.1 billion pounds. However, it now seems that a smaller crop of around 2.8 billion pounds, if not less, may be more accurate. While the industry has marketed the 2024/25 crop as a 2.8 billion-pound yield, some growers have not responded to the initial surveys, which could further impact the final numbers.

As of now, over 379 million pounds of the new crop are already on the books, but many in the industry are taking a cautious approach, waiting for more clarity before moving forward with significant shipments.

Almond Prices Remain Firm Amid Tight Supply

The almond market has shown continued firmness week after week. Despite higher price levels, supply and demand dynamics have maintained the market’s strength. Compared to other tree nuts, almonds still offer considerable value, and consumer prices didn’t drop as much as expected over the past few years. Market expectations indicate that this firmness will likely continue through the fourth quarter of 2024, with a clearer picture emerging by December when more data on the crop will be available.

Upcoming Industry Milestones

Position Report: September 12, 2024

Almond Market Trends: Week 36

Bullish Trends:

• Strong new crop sales have given growers the confidence they need going into the harvest season. Production lines are full, allowing some breathing room as the harvest catches up.
• The 2023/24 crop year saw the second-highest shipment year in history, with 2.692 billion pounds shipped. This momentum is expected to carry into the new crop year.
• The current crop is nearly sold out. With a carry-out of less than 451 million pounds, most of the remaining product consists of material below USDA grade, making this a tight transition period.

Bearish Trends:

• Many conventional retailers did not lower their prices during the previous downturn, and it will be interesting to see how they handle the higher prices now.
• With limited supply to fill the gap before the new crop arrives, August shipments may reflect an inability to meet demand, putting the industry behind schedule for the new crop year.
• Export shipments are facing delays due to equipment shortages, and rising transportation costs are adding further strain, making it harder to land products at competitive prices.

California’s almond market is facing significant pressure from extreme weather and tighter-than-expected supplies. The reduced crop estimates combined with increased demand are likely to keep prices firm well into the fourth quarter of 2024. Growers are entering this new crop year cautiously optimistic, but supply chain challenges and higher costs for transportation could complicate things further. As we move through the harvest season, it will be crucial to monitor how the market reacts to these ongoing challenges and whether prices can maintain their upward trajectory.