February through April brought very wet and unusual bloom conditions and a few very low 2023 crop estimates. In response, prices firmed for remaining current crop inventory and firmed another $0.25/lb, or so for new crop purchases, with very little inventory available. As it turns out, the earlier weather does not seem to have affected the crop as much as was originally contemplated. In May, the subjective forecast came in at 2.5B lbs and the objective estimate, released just two weeks ago, anticipates a crop yield of 2.6B lbs.
While this estimate is lower than 2021’s objective forecast and is on par with 2022’s objective forecast, it is well above the estimates that were as low as 2.2B earlier this year, in March/April. The increased new crop along with slowing sales has led to prices softening significantly and availability into 2024 increasing. Prices are attractive for buyers right now.
Barring a spike in demand and shipments, conventional almond prices may remain attractive for some time. We never know for sure. Right now, this seems to be creating a bit of a standoff as buyers have been rewarded for waiting and sellers that do not have to sell for financial reasons are still hesitant to book losses into 2024.
Could prices for 2024 soften a bit more and reach current crop levels? It is possible, but at the prices we are seeing, the potential downside might be $0.10/lb. Will demand pour in at these lower levels as we approach Diwali and the European marzipan season and send prices higher? It is possible. Recent upticks in pricing have been quickly pared back, but the market is not predictable.
For large users, now might be a great time to look at booking any remaining 2023 needs and to consider taking a position, if not booking the entirety, of your 2024 needs. While we never know what the future holds, we do know that prices are soft right now.
