Cashews

The market on cashews are still eerily quiet.  With all the news breaking from California about the temperature, moisture, bees, etc... Cashew is being ignored like a middle child at a family reunion.

"With cashews now the lowest priced tree nut in the market(other than peanuts), this could lead to some good support during the summer months.  Despite the fact that trading has been very quiet for cashews over the past four months, the prices have not weakened.

In fact, they have recently risen slightly due to the high price of raw seeds in Tanzania and Indonesia.  The biggest Northern Hemisphere crops are expected shortly in Vietnam, India and West Africa.  So far, we have not heard anything disastrous to offset the market market.  However, as the raw seed availability is so tight nearby, there will likely be good support at the start of the crops so prices for seeds are very likely to remain firm at least until end of Q2."

With the prices on the comparable nuts being so high(this means you, almonds, walnuts, pistachios, etc...)We don't see kernel consumption dropping as a result of current prices.  It is highly unlikely that we will see lower kernel prices anytime soon.

Thank you

-T. Kim
(Quotes from Mr. Mark Gravette, Barrow Lane and Ballard, UK)

California Drought

Californian Tree Nuts

It seems like "drought" is the only word that everyone seems to talk about in California, these days.

With current pricing on domestic nuts(pistachio, almonds, walnuts, etc), everyone has a stake in how much water California gets in the next month or two.  Unfortunately, it isn't looking too good.

According to US Drought Monitor(produced jointly by USDA, Dept of Agriculture and National Drought Mitigation Center, or NDMC), Western US is in for "Severe" drought for the next three months.  The reservoirs and wells are at lowest levels seen in decades and there doesn't seem to be good news in sight.

The almond growers and packers are becoming concerned for next year's crop.  The silver lining seems to be that they're finding that crop receipt number may hit 2 billion pounds.  However, with the recent news, the prices from growers have only increased.  Market is continuing the trends experienced last week. We now are looking at a nearly $0.20 cent increase in prices since the shipment report earlier this month. Many regions seem to have been uncovered on all early 2014 needs and well into the spring.  It is still too early to tell if this drought will have effect, if any, on 2014 crop.

The walnut market, which traditionally trended lower past Chinese New Year purchases, have remained stable.  With current conditions in CA and news that Chinese walnut crop is expected to be short anywhere from 20 - 30%, have kept the walnut pricing at a stable level.... which is still very high.

Please contact me if you have any questions or concerns regarding updates within the market.

Thank you.

-T. Kim

Walnut Shipment : December 2013

Good Afternoon All

Please find the update from Walnut Board's shipment report below.

As of December, 31, 2013, the packers reported walnut receipts of 487,963 tons, which should reflect close to the final 2013 crop tonnage.


Although the Central Valley has experience extra cold temperatures for the month of December, growers feel they may lose some new growth, but overall, it should not have much of an effect on the trees.

However, the major concern right now is that California is experiencing a record breaking drought. It has been reported that 2013 was the driest calendar year on record for the San Joaquin Valley.  Many of the experts fear that there is little possibility of relief in sight as the long term climate predictions do not suggest a likelihood for an average or above average rainfall over the next several months.  Right now, the Valley is only 20 percent of 8.4 inch rainfall average for this time of year.

I have discussed this with several of the major growers in this area and all are saying that water could be a major factor for the 2014 walnut crop.  Many growers were irrigation in Mid-December, which is rare for this time of year.  Many of the growers believe they will be looking forward to higher cost for water as well as some shortages in certain areas.

December inshell shipments were 36.7 million pounds, up 3.3 million pounds from last year.

Shelled shipments were 29.6 million pounds, up 2.6 million pounds from last year. Total December shipments were 51,779 tons (inshell equivalent) compared to 47,849 tons last year

The total year to date shipments (inshell equivalent) is 259,784 tons, compared to 252,684 tons at this time last year.

Based on the fact that the crop is down, shipments are up; I believe the industry should not have any problem moving this year’s crop at the current market levels.

California Walnut Shipments Recap (000)

Month (Dec)         2012/13      Year to Date      2013/14     Year to Date     Percent

In-shell (lbs.)             33,357            227,441              36,740      241,464             6.2 %

Shelled (lbs.)             27,680            123,400              29,601      123,200            -0.2%

Total Tons               47,849             252,684             51,779       259,784             2.3%

The market has not moved much over the holidays and will most likely stay firm at least for the next month or so.

Demand from Europe for shelled products and Turkey for inshell is still active as well as domestic customers looking to secure contracts for their annual requirements.

The forward market has yet to be determined and the market will adjust to whatever China does after their New Year. My guess is they will be back as current shipments are down for this region and there will most likely be less carry-over inventory they had at this time last year. In any case, don't believe the market will move much one way or the other.

Regards,

R.L. "Pete" Turner

2014!

Happy New Year Everyone!!

It has been a long and hectic year, though I'm glad that 2013 is over and welcoming 2014...

Well, not so much.  A lot of information from California, Brazil, Turkey, SE Asia isn't so great.

Please see below regarding market outlook for 2014.

Apricots

Turkish dried apricots account for almost 80+% of the world’s market.  Turkish apricots have mild and sweet taste when compared to US or China, which offers a sharper, more distinct taste.  The apricot market in Turkey remains stable for now.  The quality of 2012 crop had been leaning towards smaller sizes.  Availability for Size #1 was very short.  The current crop, 2013 harvest, shows improvement on quality of larger fruit.  Size Jumbo and #1 is now in good supply and outlook for 2014 remains stable.  The harvest of Apricots in Turkey is from July(early) to October, with shipments to US arriving by November.

Prunes

-         Majority of the prunes originate from US, Chile and Argentina.  Prunes, dried plums, are currently in short supply, as there currently is a draught issue plaguing California and western United States(It will be a recurring issue, as noted below).  The drier/packers in California are now “off the market”.  They’ve cleared their excess inventory and are only holding inventory for contracted quantities.  The harvest of Prunes in Argentina/Chile is in March and August/September for US crop.

Banana Chips

-         Dried banana chips are imported into US from Philippines.  The current crop and supply remains stable, after a sharp spike, due to weather related issues.  The dried banana chips are available throughout the year.

Cranberries

-         Dried cranberries are produced in US, Canada and Chile.  The supply and crop from 2012 crop was good, with stable demand, driving the pricing lower during 2013.  The 2014 market also seems very stable, with no spikes and/or dips in the foreseeable future.  The cranberries are harvested during March/April for Chile and Sept/November for Northern Hemisphere.

Cashew

-         There are a few players that are involved in the Cashew market.  Vietnam and India remains top processors in the world, trailed by Brazil.  Ivory Coast(Africa) are leaders in RCN(Raw Cashew Nuts).  Majority of imports to US originate from Vietnam and India.  The market has been stable for the last 3+ months, with everyone (buyers and sellers) expecting the pricing to rise.  African crop remains to be seen, though we are expecting a good quality crop.  With the current market conditions, any news that adversely affects the market will send market pricing higher.

Almonds

-         And now, we run in to major issues… The US almond crop(covering majority of world production) has hit record production for the last 3 years… with supply still unable to meet the demand.  The almond crop has seen increasing(spiking) pricing levels for the last two years.  The almonds remains extremely high priced, compared to previous years.  With the news of impending draught issues in California has only acerbated the problem.  The size of the kernels remains a problem, with virtually no size larger than 27/30 available.  There may be relief in sight for 2014 crop as subjective and objective crop estimates become available in March and May.  The harvest is in July with August ship dates for new crop.  With delays and issues plaguing the industry, we’ve noticed that for the last few years, the new crops have only shipped beginning in September.

Walnuts

-         The US walnut is the current leader in production, providing majority of the world.  Surprisingly, the walnut market has been quiet with no major market movements post harvest.  This may be due to uproar over the almond crops.  This does not mean that market pricing is “reasonable” and supply is abundant.  At current trading price, many packers and traders feel that pricing may not be sustainable.  While we do expect market pricing to ease off a bit in the coming months, China and India are major factors to consider(more on this below).  The crop estimates are available during Q2 and Q3, with harvest occurring from early August through October and November for Chandler varieties.

Pecan

-         The US pecan market is at a very high level.  US and Mexico are major suppliers, with growing regions in Texas, Georgia and surrounding states.  The current pecan market is about $1/lb over last year’s opening market price for new crop.  Barring any issues (weather, pests, China…) we may see a gradual easing of the market pricing as we move through 2014.  The pecan crop harvest is during Q3, ending in November(Just in time for Thanksgiving/Christmas season!). 

Pistachio

-         Pistachio market has been on a roller coaster for 2013 season.  The pricing differential throughout the year has been +/- $1.50/lb(or about 30%).  Currently, the pistachio market is very high, with limited offerings from majority of the packers.  The quality of the crop seems to run towards smaller sizing(21/25) and pricing remain firm in the foreseeable future.  The pistachio harvest is generally done during late Q3.

Please let me know what your thoughts are on the matter.