Record-Large California Almond Crop Forecast for the 2017/18 Season
In July, the NASS Pacific Regional Office released the 2017 California Almond Objective Measurement Report, which revised production up 2 percent from May’s Almond Subjective Measurement Report, to reach 2.25 billion pounds. If realized, the 2017/18 almond crop will surpass the 2016/17 record harvest of 2.14 billion pounds, setting a new high.
Bearing acreage and number of trees per acre both increased to record levels in 2017, driving up production for the 2017/18 marketing season (August-July). Bearing acreage has expanded year after year from 428,000 acres in 1996 to 1.0 million acres in 2017, along with generally increasing numbers of trees per acre.
Growers reported that, though adequate, there were fewer chill hours this winter than in 2016, and the bloom period was longer due to the cold spring. Orchard work was made complicated by significant rains, especially before and during the bloom period.
As the nuts were developing, a heat wave in June propelled growers to irrigate more frequently to prevent stress on the trees. The excessive heat delayed the period when the hulls start to split, delaying harvest. Meanwhile, pest and disease pressures were reported light.
The 2016/17 almond season ended in July, with total marketable production at 2.09 billion pounds, an increase of 13 percent from the previous season. This, along with record-large beginning stocks, boosted overall domestic supplies. Total supplies available for the domestic market increased 18 percent from the previous season, translating to 2.07 pounds per person during the 2016/17 marketing year.
Improved demand in export markets helped alleviate stock levels, but ending stocks remained relatively large. As these sizeable ending stocks meet up with the anticipated record harvest this year, continued huge overall supplies will likely suppress almond grower prices again in 2017/18.
The 2016/17 season experienced a significant drop in the average grower price for almonds as supplies continued to outpace demand. At $2.44 per pound, shelled basis, the average price last season dropped for a second consecutive year, from a peak of $4.00 per pound in 2014/15 and $3.13 in 2015/16.
While the value of utilized production fell 30 percent below the 2014/15 high of $7.4 billion and down 12 percent from 2015/16, it was the fourth-highest crop value on record at $5.2 billion.
Total 2016/17 almond export volume rose 13 percent to 1.44 billion pounds, shelled weight, from the previous season. Export demand was strong for shelled and inshell almonds but weak for prepared and preserved almonds. Shelled almond exports climbed 18 percent, totaling 1.14 billion pounds.
Shelled shipments to Spain increased 8 percent to 208 million pounds and were matched by moderate to significant gains to most other foreign outlets, including major markets Hong Kong, Canada, Japan, the United Arab Emirates, and most key markets in Europe.
Total California in-shell almond exports increased 12 percent to 453 million pounds in 2016/17. Exports to India, which accounted for nearly half of total in-shell volume, were up 12 percent, while shipments to Vietnam, Turkey, and Pakistan saw even greater gains.
Demand for California almonds in China was weak as indicated by significant declines in U.S. export volumes for shelled (down 36 percent from previous season), in shell (down 23 percent), and prepared and preserved (down 94 percent) almonds.
California Walnut Crop To Decline for the 2017/18 Season
The 2017 California Walnut Objective Measurement Report, released September 6, forecast walnut production at 1.30 billion pounds (or 650,000 tons), in-shell basis, down 5 percent from last year’s record crop of 1.32 billion pounds (or 686,000 tons).
This decline reverses the past 3-year trend of production climbing to record-breaking levels (table 9, reported on a shelled basis), likely boosting walnut grower prices during the 2017/18 season (September-August).
If the forecast crop size materializes, it will be larger than the previous 5-year average. However, these ample supplies will likely be partly offset by reduced carry-over stocks on strong overall demand during the previous season.
Walnut orchards received sufficient chilling hours and a lot of rain during the winter and spring. Some orchards, however, were reported to have had increased insect problems and compromised root systems due to excessive rains. With the heat waves over the summer, growers had to take preventive measures to protect their crop from sunburn damage.
Statewide bearing acreage for walnuts in 2017 continued its long-run upward trend, increasing 6 percent from last year to a record 335,000 acres. Likewise, at 74.1 trees per acre, trees density is at a peak in 2017, up 1 percent from a year ago. Despite these increases, the anticipated smaller crop this year could be blamed on lower yields. The average yield in 2017 is reported at 1.94 tons per acre, down from the record 2.18 tons in 2016.
While the State average nut-meat weight is reported up 8 percent from last year to 23.4 grams, nut sets are down to a record low at 1,141 nuts per tree, 19 percent below last year’s average of 1,406.
During the 2016/17 season, strong overall demand aided California walnut grower prices from falling a second year in a row. Despite the record-large crop and higher-than-average beginning stocks, 2016/17 grower prices improved to an average $0.91 per pound (or $1,810 per ton), in-shell basis, up from $0.84 per pound (or $1,670 per ton) in 2015/16—the lowest average price since 2010/2011.
Global sales of California walnuts increased in 2016/17, particularly for the in-shell product. Total U.S. exports of in-shell walnuts in 2016/17 through July were up 48 percent, reaching 399 million in-shell pounds on substantial gains to most major markets, including Turkey, Italy, India, and the United Arab Emirates.
For the same time period, total shelled-walnut exports declined 11 percent mostly on huge declines to China and Turkey. Over 60 percent of U.S. walnut supplies are destined for the international market.
Smaller Hazelnut Crop Expected as Harvest Begins in Oregon
In late August, the NASS Northwest Regional Field Office released the 2017 Hazelnut Crop Forecast, which measured the crop to be 72 million pounds (or 36,000 tons), in-shell basis, down 18 percent from the 2016 on-year crop. The volume, however, is up 7 percent from the previous off-year, 5-year average of 67.6 million pounds (or 33,800 tons).
Yields this year were likely hampered by the wet spring, excessively hot and dry conditions this summer, and continuing concerns with the Eastern Filbert Blight disease. The percentage of good nuts sampled was slightly higher than last year at 88.1 percent, and the average dry weight per good nut was 3.03 grams, only fractionally higher than last year.
However, the number of nuts picked per tree declined from 224 nuts to 201 nuts during the same period. Of the total good nuts, the proportion of large nuts was 49 percent, up from the 46 percent in 2016. At the same time, the proportion of small nuts remained unchanged at 11 percent, while that for jumbo nuts declined from 36 percent to 28 percent.
On a shelled basis, increases in marketable production and imports during the 2016/17 season (July-June) provided a significant boost to overall supplies, even as carryover stocks from 2015/16 were very low. As overall supplies rebounded markedly last season, the average grower price for California hazelnuts declined 4 percent from $2,800 per ton in 2015/16 to $2,700 per ton in 2016/17.
Although down significantly from the record $3,600 in 2014/15, last season’s average price was higher than those reported for any other year since the 1970s. The decline in the average price was more than offset by the production gain, raising the value of the 2016 crop to $118.8 million, up from $86.8 million.
Increased production and lower grower prices helped stimulate demand in 2016/17, with significant gains in export volume (up 31 percent from 2015/16) and domestic availability (up 26 percent). Despite these gains, ending stocks rose sharply to be the second highest in the past 10 years.
As the industry expects a smaller crop this season, these large ending stocks should provide some supply cushion in the market, likely keeping a lid on 2017/18 U.S. hazelnut prices.
Pistachio Crop Rebounded To A Record for the 2016/17 Season
After poor yields cut production by nearly 50 percent during the 2015/16 season (September-August), the California pistachio crop bounced back to 896.5 million pounds, in-shell equivalent, in 2016/17—the largest crop harvested on record.
Production was more than three times the size of the 2015/16 crop and 79 percent larger than the 2010/11-2014/15 average output. In addition to continued increases in bearing acreage, yields were also up in the on-year cycle of the pistachio crop’s alternate-bearing nature.
The crop also benefited from adequate chill hours and rains during the winter of 2016. Bearing acreage was reported at a record 239,000 acres in 2016/17, while yields rose to a near record 3,750 tons per acre, up from only 1,160 pounds in 2015/16.
While the 2016/17 season started out with significantly lower carryover stocks, the record-large crop, not to mention increased imports, significantly boosted overall supplies for the industry’s marketing needs.
California pistachios have generally seen positive demand in both the domestic and export markets over the last decade. U.S. pistachio exports, however, declined significantly in 2015/16 in part due to the small crop.
During that period, export volumes were down to major international markets (which include Hong Kong, Belgium, the Netherlands, Federal Republic of Germany, and China) for combined shelled and in-shell pistachios, and Hong Kong, Mexico, Australia, and Turkey for prepared and preserved pistachios.
In 2016/17, year-to-date exports through July have rebounded strongly in all the top markets, and domestic availability was also up sharply from the previous season.
Data from the Administrative Committee for Pistachios indicate domestic shipments in 2016/17 were up 49 percent from the same period in 2015/16 at the same time that export shipments were up very sharply. Bumper supplies have led to lower pistachio grower prices in 2016/17, averaging $1.68 per pound and the lowest price over the last 7 years, based on NASS data.
The pistachio harvest for the 2017/18 season begun in early September. Yields are likely to be dampened by the cold, rainy spring and intense heat over the summer, especially as this year’s production is following a very large crop last year. Any potential for reduced production in 2017/18 will be partly offset by likely record- high ending stocks in 2016/17.
U.S. Pecan Production Up in 2016/17
U.S. pecan production during the 2016/17 marketing season (October-September) was slightly up from the initial NASS forecast in October 2016, with the current estimate reported at 268.8 million pounds, utilized in-shell basis, up 8 percent from the previous year.
Despite eliminating six States from the NASS annual production survey for pecans, the 2016/17 crop was larger than the previous year, reflecting bigger crops in most producing States, including Georgia and Texas.
Together, these two producers supplied more than half of the U.S. crop. Georgia, New Mexico, and Texas remain the top three pecan-producing States in 2016/17. New Mexico’s production is estimated down 1 percent from the previous year.
Higher domestic production, beginning stocks, and imports have boosted overall domestic supplies in 2016/17, but strong demand for U.S. pecans, especially in the international market, supported grower prices. NASS reported pecan prices averaged $2.59 per pound in 2016/17, up from $2.20 in 2015/16.
When combined with the larger crop, the higher prices drove up the value of production in 2016/17 to $696.8 million—an all-time high.
Cumulative exports for the season through July show volume gains in in-shell (up 8 percent) and shelled (up 58 percent) pecan sales relative to the same time in 2015/16, with increased deliveries to many of the key markets in North America, Europe, the Middle East, and East and Southeast Asia.
Two recent hurricanes have raised uncertainty about potential crop size for the 2017/18 season. Hurricane Harvey made landfall in Texas on August 25, bringing powerful winds and heavy rainfall that caused flooding in parts of southeastern Texas. Hurricane Irma made landfall in Florida on September 10, affecting most of the State and then weakened into a tropical storm before hitting Georgia and South Carolina.
While the full impact of damage to agriculture from these two weather events are still being assessed, the NASS Southern Plains Regional Field Office reported that as of mid-September, pecans were making favorable progress for the 2017/18 harvest.
Reports from the NASS Southern Regional Office, on the other hand, indicated significant damage to pecan orchards in Georgia, citing downed trees, broken tree limbs, and a significant proportion of nut drop. NASS will release the initial U.S. pecan production forecast for the 2017/18 season in the October 2017 issue of the Crop Production report.