What to do with almonds?
That’s the question given the current state of the California almond industry, one that’s undergoing some critical challenges.
“Supply-wise with our 2021 crop, we still have a lot of supply,” says Bikram Hundal of Custom Almonds LLC. in Earlimart, CA. “It’s most likely this will be the biggest carry-in that the industry will see into the new 2022 harvest in August. The estimate so far is 800 million lbs. That’s quite a big carry-over.”
What’s behind this carry-over given the fact that the crop itself was only two percent less compared to the 2020 crop? Not surprisingly, logistics. “The port bottlenecks that we’re facing, the ships cannot take enough goods out there to the rest of the world,” says Hundal.
Inconsistency with bookings is one key issue the industry is dealing with. Hundal says bookings that are initially confirmed look to in fact be overbooked and are canceled at the last minute. Or they’ll suddenly be changed and have more limited loading days attached. “It’s a shorter window when we can move containers–two to three days. Before it was four to five days and some containers are able to make it onto ships and some are not,” he says, adding of course that the general shortage of containers is also impacting movement.
Adding the fact that fewer vessels are sailing as well and port congestion continues to be an issue. “It’s gotten worse,” he says. “It started in August because everyone started shipping. We were able to get bookings and ship within a month and a half window. Now we’re two months behind,” he says. “So we have to plan ahead to find bookings for vessels and we don’t know if they’ll have space or if they’ll cancel the booking so we’re just in the dark.”
While this is affecting key export markets such as India, the Middle East and Europe for California almonds, China is seeing more secure bookings-not surprising given all the empty containers coming back. “But China didn’t buy as many almonds because of the import tariff issue it has with U.S. almonds. And now Australian almonds are going to come in and they’ll likely buy from Australia,” says Hundal.
Source: Fresh Plaza (2022)