Almond yields estimated to be high
- The USDA has predicted an almond yield in California of three billion pounds
- Many growers feel that this estimate is too high
- Almond trees are under stress from heat, lack of good quality water, and fewer inputs due to high production cost
- Almond prices have fallen following the estimate, but could rise again
The future of almond yields is bright, according to a major prediction.
A recent estimate from the US Department of Agriculture (USDA) predicted a yield of three billion pounds (1.3bn kg) of the crop in California, where around 80% of the world’s almonds are grown. The annual estimate is considered crucial for almond growers.
This prediction of abundance has, however, been met with scepticism from some growers, who suggest that the USDA is overestimating yields.
Why are almond yields predicted to be high?
The USDA’s estimate of three billion pounds is up 7% from the “subjective estimate” in May, an earlier, rougher estimate of crop output. It is around 10% more than last year’s crop.
Despite some storms earlier in the year, the weather has improved significantly, according to the USDA, boding well for crop yields. Mild temperatures and rain have eased heat stress, for example.
The high estimate for almond yields nevertheless “caught the market by surprise,” according to Damien Houlahan, global head of almonds for leading grower Ofi.
The high estimate seen here may be inspired by average yields from the preceding 15 years. However, this average has been offset by two highly successful years, 2011 and 2020.
Why do growers think this is an overestimate?
Many growers have been sceptical about the estimate. While they see a “reasonable and solid” yield, explains Ofi’s Houlahan, the number given by the USDA seems too high.
Prices have been below the cost of production for some time now, he explains. Thus, growers have been saving money by reducing crop inputs.
There have also been water supply issues in California. Not only have farmers been relying on less water, Houlahan explains, but lower quality water, with higher salts. This can impact yields. Trees that have experienced persistent issues with water and nutrition can be permanently stunted and may never recover.
Like many other crops, almond crops also feel the impacts of heat stress.
It is unlikely that yields will increase so substantially with these factors still in play, he suggests.
Blue Diamond, another leading almond grower, was also surprised by the estimate.
It points out that in three out of the past five years, the USDA’s estimate was higher than the crop eventually delivered.
However, Blue Diamond stresses that it remains only an estimate. “Estimating the almond crop is a complex task, particularly in a year marked by significant challenges on the ground,” explains a spokesperson.
“California almond growers continue to contend with increased pest pressure and rising input costs.”
California’s total almond acreage has declined for the third year running, despite the bearing acreage (land planted with trees of a bearing age) increasing.
This is because trees being taken out of California are not being replaced by non-bearing acres.
Both third-party data such as that from LandIQ and on-the-ground observation suggest that yields could be significantly lower than estimates suggest, the spokesperson concludes.
How has the estimate affected prices?
The market has reacted to the estimate, with prices falling by around 20% in response. Since then, demand has started to kick in.
Prior to this, many had not been buying forward as the price was too high.
“We’ve seen significant significant kick-in of demand, particularly in those markets that had been delaying their buying decisions and had been able to delay their buying decisions because they’d had adequate supply up until now,” Houlahan explains.
He predicts that there is likely to be some reverse of the fall in price.
