Market participants surveyed by Mintec in the first week of July were expecting muted shipments and new sales ahead of the June position report, which is due for release on 11th July. Estimates for June almond shipments were reported in the range of 178-225 million pounds, with most market participants returning figures of 190-205 million pounds.
“Most of the industry seems to be expecting a shipment figure of around 200 million pounds, but there is a lot of potential for the figure to be higher or lower this month. Seasonal pools are well sold, and the final figure is likely to come down to how much call growers have been willing to sell, which is hard to pin a figure on,” a US exporter said to Mintec.
Market participants suggest this trajectory would put 2022/23 ending stocks around the 750 million pound mark. Based on the May position report inventory levels, this would require an average shipment level of 205 million pounds per month over the next two months (June-July).
Uncertainty ahead of USDA Objective Almond Measurement
Market participants surveyed by Mintec ahead of the release of the USDA Objective Measurement gave a wide range of responses of 2.20-2.55 billion pounds. The majority of those surveyed expected the report to come in between 2.30-2.50 billion pounds.
“If the report comes in at 2.50 [billion pounds] or higher, it’s going to be a bloodbath. A lot of smaller growers are dealing with high mortgages and have tapped out their lines of credit. If prices fall again, I’d expect to see a lot more foreclosure signs popping up; the banks aren’t willing to fund another year of losses,” a US handler said to Mintec.
On the buy side, several buyers spoken to by Mintec were unconcerned over the release, with one Spanish buyer saying, “no matter what the Objective comes in at, there isn’t going to be a shortage of almonds. The carry-in is looking too large, so longer term, it seems like any upwards price movement is likely to correct downwards.”
This sentiment was repeated by both buyers and traders, who were uncertain if there was sufficient demand to sustain higher price levels throughout the remainder of the season.
“If the Objective comes in on the low end, I’m expecting prices to rubber band again. Sellers will try to put their pricing up, but someone who needs cashflow will break ranks, and the race to the bottom will repeat. The question is where the price floor will be,” a UK trader said.
For more information:
Mintec Global
Email: Nuts@Mintecglobal.com
www.mintecglobal.com