The Almond Board of California released the March 2019 Position report today. Shipments for the month of March totaled 184.9 million pounds (193.9 million pounds March 2018) with new sales of 147.5 million pounds (111 million pounds March 2018) bringing the industry to 80% committed and shipped for the 2018 campaign. The domestic market continues to lead the way in shipments and commitments year over year with shipments up 3% and committed unshipped up 14.31%. Export shipments are down 3.65% YTD with current export committed unshipped down 2.48%. Leading up to the report overall consensus was that shipments would be slightly below last year, which that is exactly what today's report shows.
Crop receipts look to be all but wrapped up with 2.26 billion pounds to date. Even with a slightly larger crop this year the industry currently has less available inventory to sell with uncommitted inventory down 4.79% (525vs.551 million pounds). This is taking into account the Almond Board's projected carryout of 360 million pounds.
Overall shipments for the year are down 1.69% totaling 1.58 billion pounds versus 1.61 billion pounds. Here are some notable observations for review:
China/HK continued its downward trend on shipments with YTD shipments down 31% versus down 25% last month.
India had another strong month bringing the YTD shipments up 4% from last year.
Western Europe's trend continues with overall shipments YTD down 7% (France -4%, Germany -20%, Italy -14%, Netherlands +28%, Spain -5%, UK -9%).
Middle East is up 2% YTD as the some of the straggling shipments arrive for Ramadan.
The trade war between China and the US is having the impact many expected, and shipments could finish down year on year around 30% to 40%. India's shipments continue to impress both buyer and seller with shipments up again overall versus last year. Western Europe continues its trend of just in time delivery lacking forward commitments. One factor to consider in Europe is the available stock of uncommitted inventory.
Leading up to the report some slippage in prices was noted with prices down about 3-5 cents per pound. The compression is still very noticeable with prices for the bottom end items around $2.76-$2.78 for Standard 5%, Cals $2.80-$2.85, Carmel Type Supreme $2.88-$2.95, Nonpareil $2.93-$3.10, and Nonpareil Inshell $2.28-$2.35.
Typical for this time of the year we see a price trough with pricing secondary to supply and liquidity at the forefront of buyer's minds. Spring and summer months lean more towards supply trying to bring positions more into equilibrium post the holiday rush. We could see a rally in pricing with the limited inventories on items such as Carmel Type Supreme and quality Nonpareil.
Now with another shipment report in the books, focus will shift to upcoming crop estimates and acreage forecasts. Growing optimism on the 2019 crop could keep new crop sales slow and current crop pricing could feel a bit of the optimism moving into the spring and summer months.