2016 Crop Objective Estimate
NASS released the Objective forecast today at 2050 million lbs. This is up from the Subjective forecast of 2000 million lbs and about 8.2% up from last year’s crop of 1895 million lbs.
Nutset per tree is up as well as size and weight versus last year. The nonpareil crop is forecast at 780 million lbs, up from last year’s receipts of 697 million lbs.
The market now has a number it can work for the next few months – at least until reliable harvest information starts to emerge.
Over the past couple of months strong shipments have whittled the carry-over expectation into the 2016 crop to less than 450 million lbs. Already the industry is feeling the pinch of the transition as certain items deplete.
With a 2050 million lb crop California sellers will have to increase shipments by an achievable 8.2% to maintain a similar carry-over into the 2017 crop and the market will price itself accordingly.
Indeed we have seen prices drop by about 30 cents per lb over the past couple weeks in the run-up to the forecast. The environment was complicated by Brexit and currency gyrations, but certainly the fear of a more hefty forecast was looming large in buyer calculations. We would guess market expectations were for a 2100 million lb or more estimate.
2050 million lbs will settle both buyer and seller worries for now and likely will have a supportive effect on pricing. Focus over the next few months will now be on shipments — which are expected to be good.
CEO Treehouse California Almonds, LLC