Friday, Jul. 13, 2012
Forecast calls for record almond crop
By John Holland / The Modesto Bee and Robert Rodriguez / The Fresno Bee
This year's California almond crop looks like it will set a record after all, the federal government has projected.
The National Agricultural Statistics Service estimated late last week that 2.1 billion pounds would be harvested this year, up from the initial projection in May of 2 billion pounds.
That first estimate, based on a telephone survey of growers, put the crop at less than last year's record 2.03 billion pounds. The second figure relied on measurement of developing almonds and nudges 2012 into first place.
The actual figure will depend on conditions during the harvest, which will start in August.
The agency announced the projection at the Modesto headquarters of the Almond Board of California. It is closely watched by the industry because of its possible effects on prices for the nuts.
Almonds are second only to milk in gross farm income in the Northern San Joaquin Valley.
The world has gone nutty for California almonds, as consumers gobble up all the state produces. More than 70 percent of the state's crop is exported.
And despite concerns from some growers about overproducing, the sellers of California almonds aren't flinching at the huge crop estimated by the U.S. Department of Agriculture.
"Our only concern is on the supply side, we want to make sure we can keep up with demand," said Richard Waycott, president and CEO of the Almond Board. "We have had such incredible growth in virtually all of our markets around the world."
Exports to China, South Korea and the Middle East grew by double digits from August 2011 to May 2012, up 18 percent over that period last year, with China and Hong Kong the largest export markets.
Research showing almonds are a healthy snack is helping fuel California almond sales, as is the emerging middle class in countries such as China and Russia.
"These are foods that the average consumer did not have before," Waycott said. "And now that they can afford it, they are relishing the ability to buy them."
Having made inroads in several major worldwide markets, the Almond Board is not resting on its laurels. This August, it is setting its sights on untapped markets, including Brazil.
Waycott said Brazil has what the almond industry wants: an established middle class, familiarity with almonds and a large confectionery industry.
"There are 200 million people who we could be selling to," Waycott said.
Daniel Sumner, a professor of agricultural economics at the University of California at Davis, said that despite the already large output, California almonds have great growth potential.
"This is not like cotton or apples, where there is already a mature market for the product," Sumner said. "The average consumption of almonds worldwide is relatively puny, so as the industry gets more efficient and continues to market, there is going to be plenty of room to expand tree-nut consumption."
Some growers are skeptical about how the industry can sustain the current rate of growth.
"I just hope this doesn't turn out like the housing market," said Madera almond grower Alex Lehman. "What we don't want to see is for the economy to crash and for people to stop buying."
Lehman farms several hundred acres of almonds.
Ballico almond processor Dave Long admits that in the 1980s, he, too, was concerned the industry was getting too big.
"When we hit the 500-million-pound mark, I didn't think we were going to be able to sell the crop," said Long, owner of Hilltop Ranch in Ballico. "But look at us now. Over the last 10 years, we have seen compounded growth of nearly 10 percent each year."
As of May 31, shipments of the 2011 crop and 2010 carryover were up 15 percent compared with a year earlier, according to the Almond Board.