From the start of the Californian water year on October 1st until April 9th, statewide precipitation has been 148% of normal. Average precipitation in the state over this period reached 30.0 inches (762 mm), compared to the historical average of 20.3 inches (516 mm). As of April 9th, statewide snowpack was 248% of the average (with a snow water equivalent of 62 inches). As the snow melts, it will replenish reservoirs around the state, which are already at 104% of the average for this time of year. However, the abnormally high snowpack is also a clear indication of the stormy weather that has raged over California during the past few months, and the effect of cold, windy weather on production could be significant.
From January to February, when almonds bloom, millions of beehives are brought to California from all over the country to pollinate the flowers. However, in poor weather, bees do not leave the hive. Cold, wet weather during this year’s pollination period led to low bee flight hours. The exact extent of this year’s reduced flight hours is still not known, as erratic weather could mean some regions were more severely impacted.
Poor conditions continued after pollination when unseasonable cold temperatures hindered the development of almonds. The average minimum temperature for the first 10 days of April 2023 was only 6°C, dropping as low as 1.32°C on April 5th. Last year, the average minimum temperature was 12°C, and historically, the average minimum temperature is 10°C over the same period. The cold temperatures hindered nut development right after pollination and could lead to further losses or poorly formed, eventually smaller almonds.
In the coming weeks, more certainty will be gained about the effects of the poor weather conditions on the almond crop. During this time, some will be shed by trees, and most of the remaining almonds will eventually grow into marketable nuts. Counting test samples after shedding will provide a fairly accurate indication of the size of the crop. Until more clarity is obtained, prices could build in a risk premium, especially those of larger and larger and higher quality nuts.
There has already been a gradual rebalancing in supply and demand. The almond crop will likely fall around 50 million lbs short of the 2.6 billion lbs estimate. Exports in the latter half of the marketing year have been particularly strong, reaching a cumulative total of 1.3 billion lbs at the end of March, compared to the 5-year average of 1.2 billion lbs. So there could be a rapid shift in the supply and demand situation and an acceleration of the recent bullish price trend if the 2023 crop falls short of the 5-year average of 2.68 billion lbs. The USDA's first crop estimation will be released on May 12th and will provide direction to prices.
Source: USDA, Almond Board of California