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Maybe a Surplus? Almond growers uneasy over big estimate

The rainy weather didn't keep the working bee's from doing their job in an almond orchard Friday, Mar. 2, 2009 near Sisk Road and Kiernan Ave. in west Modesto. (Marty Bicek / mbicek@modbee.com)
The rainy weather didn't keep the working bee's from doing their job in an almond orchard Friday, Mar. 2, 2009 near Sisk Road and Kiernan Ave. in west Modesto. (Marty Bicek / mbicek@modbee.com)

The state's almond crop looks as if it will be smaller than last year's, the federal government reported Friday, but it still might leave the industry with a surplus of nuts.

The orchards will yield about 1.45 billion pounds of almonds, the National Agriculture Statistics Service said in the first of two projections before the harvest starts in August.

That would be 10 percent less than last year's record 1.61 billion pounds from California, which produces more than 80 percent of the world supply.

People in the industry said they had expected a smaller crop, which would help sustain the recent uptick in prices for growers.

"I'm hoping it doesn't have a chilling effect on our prices," said Dave Phippen, a grower and processor near Ripon. "We've really had good movement of almonds in the domestic and export markets, and we want to continue that."

The average price is about $1.25 per pound, better than early this year but still below the strong levels of recent years, said Dave Baker, director of member relations for Blue Diamond Growers, the world's largest processor.

Ron Fisher, owner of Fisher Nut Co. of Modesto, said the new crop projection could put a halt to the recent price gains and make almond growing unprofitable.

Phippen said the crop likely will not be large enough to trigger the "reserve" system. Under this little-used policy, a percentage of the harvest is held off the market to raise prices.

The crop estimate, as usual, was announced at the stroke of noon at the Modesto headquarters of the Almond Board of California.

It was based on a telephone survey of 275 growers, all of them in the Central Valley.

The second projection, based on actual measurements of the developing nuts, will be released June 30.

The agency estimated an average yield of 2,040 pounds per acre, down from the record 2,370 last year. The state has about 710,000 bearing acres, up from 680,000 last year.

Federal statistician Doug Flohr said the 2009 crop is doing well despite cool, damp weather during part of the bloom, when mild days are preferred, and a drought that has cut water supplies in parts of the valley.

Growers have been concerned about the decline in pollinating bees, but that did not seem to have an effect.

This year started with a lull in sales from the 2008 almond harvest. Shipments to domestic and export markets totaled 92.6 million pounds in January, compared with 97.1 million a year earlier, according to the Almond Board.

That turned around fast. Shipments were 106.3 million pounds in March, up from 91 million a year earlier.

The buyers were drawn by reduced prices, Blue Diamond Chief Executive Officer Doug Youngdahl wrote in the cooperative's bimonthly magazine.

Baker said demand and prices could rise together over the long term as people discover the health benefits of almonds and boost their incomes.

"If you take China and India, each has a middle-class population now that is almost as large as the entire U.S. population," he said.

Bee staff writer John Holland can be reached at jholland@modbee.com or 578-2385.

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