"For a long time, German food retailers endeavoured to remove shelled walnuts from their product ranges at the end of the Christmas season, as there was supposedly no demand for them after Christmas. However, this has been a thing of the past for a few years now," says Joachim Alkewitz, Co-Managing Director of PALM Nuts & More, Nuss und Trockenfrucht GmbH & Co. KG. and Mariani of California (Germany), the German subsidiary of one of the largest US walnut producers, the Mariani Nut Company from Winters, California.
Jens Borchert, Joachim Alkewitz and Bernd Hofmeister at Fruit Logistica 2023
Year-round availability and health aspects
"Walnuts, even in the shell, have now become a year-round product in Germany. Until a few years ago, producers would never have dreamed of this. The advertising efforts of the last ten to fifteen years seem to have borne fruit. Consumers particularly appreciate the health aspects of walnuts." Furthermore, dried fruits such as dates and figs, which, like walnuts, were purely a Christmas product a few years ago, are now also available as year-round products.
PALM Nuts & More/Mariani sources walnuts exclusively from California. However, production is also increasing in countries such as France, Portugal and Spain. "The walnuts grown in these countries are of good quality. The European growing regions are becoming more interesting for local retailers, particularly in terms of sustainability and comparable aspects. However, it is questionable whether lorry transport is really more environmentally friendly than ship transport," says Alkewitz.
According to figures from the California Walnut Board, the equivalent of around 4,200 tonnes of walnuts in shell were exported to Germany in 2022, which is 25 per cent less than in the previous year. "However, the development over the last ten years shows that the trend has been consistently positive and demand has risen steadily. It's a steep curve, similar to the DAX in its best years."
Harvest of 760,000 tonnes of walnuts
He described the price level of Californian produce as attractive. "The harvest volume is good, but nowhere near as good as was expected at the beginning of the year. A harvest of around 760,000 tonnes is expected this year, while around 750,000 tonnes were harvested in 2022. In terms of quality, California is expecting one of the best harvests ever. This is probably also due to the fact that the weather conditions in spring were good. Especially as it rained extensively in winter, which meant that the reservoirs were very well filled. The issue of water shortages is therefore off the table, at least for this year. However, California is still a very dry state." Apart from walnuts, the production volumes of almonds and macadamia nuts also slightly exceeded demand.
Price correction for producers
"The prices for walnut cultivation in California sometimes no longer covered the costs for producers, which is why entire areas were not harvested. In some cases, entire orchards were taken out and the ground levelled in order to grow other crops. As a result, a market correction has already taken place in California," explains Alkewitz.
Walnut kernels of the Chandler variety are often marketed in 200 g bags, but other varieties are also well suited to this market segment. "The Howard variety is predominantly sold in the shell. Of the more than 40 different varieties cultivated in California, perhaps seven to eight varieties are suitable for export." The most popular sales units are 400 g, 500 g and the 1 kg bag. The product is marketed exclusively to the retail trade.
Oversupply from California
"There is more than enough product available," says Alkewitz. "In the USA, there is a mechanism whereby the state is allowed to buy up several thousand tonnes of the domestic product from the packers if required in order to supply public institutions such as school canteens, care homes, etc. via its own programmes. This was practised on a large scale last year. This is intended to ensure a certain degree of market stability due to the oversupply from California." This makes the USA the largest buyer of its own walnut production. The largest buyers of in-shell walnuts worldwide include Germany, Italy, Turkey, Spain, the Netherlands, Belgium, the United Arab Emirates, Algeria, Egypt, India, Vietnam and China.
With over 2,000 containers (40ft) per year, Turkey is one of the world's largest buyers of the Californian product. "On 1 November 2023, the Turkish government imposed a new tariff on Californian walnut imports. This is an attempt to limit the outflow of foreign currency, both for the product in the shell and for walnut kernels."
Consumption and traceability
"Nuts have found their way everywhere," states Alkewitz. "However, the wide range of possible uses for nuts can be expanded even further. Of course, nuts are also a trend in plant-based and vegan nutrition, which in turn ensures their continued use in the industrial sector. However, this requires long-term price stability."
Alkewitz identifies the issue of traceability as an upcoming challenge for the industry as part of the Supply Chain Sustainability Act (LkSG) and its documentation. "California is ideally positioned in this area. They are able to trace both individual batches and the entire supply chain as such."
For more information:
Mariani of California (Germany)
Tel.: +49 4181 9091 0