Walnut Market Update September 11, 2011

R.L. “Pete” Turner
CROP:

NASS’s official 2011 walnut crop “objective” estimate of 485,000 tons was a surprise to many in the industry. It came up 38,000 tons short of the Packers “subjective” forecast of 523,000 tons set in late July. Never the less, it is still the second largest walnut crop in history, 18,000 tons less than the record 2010 crop.

Growing conditions were similar to last year, as the orchards received adequate chilling hours, above average rain and moderate temperatures, all ideal for a good and quality walnut crop. However, again like last year, the crop is at least two weeks late and most packers will not go into production until the last week of September.

NASS’s survey data indicates the average nut set per tree is down 18 percent compared to last year. However, the nut sizes appear to be larger than last year, so hopefully, we will have more large and jumbo walnuts available than we did last season.

Listed below is my guess-a-mate for the major varieties tonnage, which is based on the tree nut count and nut sizes.

Variety 2010 crop 2011 crop Difference

(Tons)
Chandler 209,000 198,000 (11,000)
Hartley 70,000 65,000 (5,000)
Tulare 47,000 52,000 5,000
Howard 55,000 50,000 (5,000)

August walnut shipments were 19,597 tons, about the same as last year. This puts the 2010 crop total year shipments at 506,568 tons, 53,000 tons more than last year. Again, the market was driven by the record bookings from China/Hong Kong, Turkey/U.A.E and Europe. Exports sales accounted for 60 percent of the total shipments with domestic at 40 percent.

The 2010 crop carry-over is expected to be less than 40,000 tons. This coupled with the 485,000 ton crop gives the industry a total availability of 525,000 tons, 25,000 tons less than last year.

Right now, the next several weeks weather forecast looks good and grower harvest operations should go well. However, with a late crop, everything is compressed and the grower harvesting, the huller operations and walnut plant receiving and production facilities will all be highly challenged.


Market:

Pre-season bookings that started out very heavy in June have now dropped off slightly, however, with the opening prices coming out lower than most expected; new bookings will most likely be going full force by Monday.

Opening prices for Jumbo Hartley’s were set at $1.65, Chandler 70/30 Jumbo/Large at $1.75 and Regular Light Halves and Pieces at $3.85.

By the end of next week, we should know how the market will react to these prices; but my guess is that the new bookings will be very active at these levels. However, contracts for early shipments may bring a premium, especially on in shell Chandlers.

Please let me know if you have any questions or comments.

Kind regards,

Pete