Chile’s walnut industry continues to boom and production in 2023 is set to surpass all previous years, estimated at 190,000-192,000 mt (in-shell). More young trees are starting to bear nuts and conditions were good for most of the growing season. The harvest has just started and clarity on the size of the crop will be gained as the harvest progresses, but early indications are an increase of 9-10% over the bumper 174,948 mt produced in 2022. These production levels align with Chilenut's (the Association of Producers and Exporters of Chilean walnuts) long-term projections, which estimate production to surpass 210,000 mt by 2025.
The walnut industry in Chile has had a successful 2022/23 marketing year, which ended on March 20th, coinciding with the autumn equinox. The industry exported 179,549 mt, with 20 days to go in the marketing year, a significant increase of 22% compared to the 148,008 mt exported in 2021/22. Exports also exceeded production in 2022/23, depleting leftover inventory from the previous campaign. This highlights the success of Chile's marketing campaign especially compared to other walnut-producing countries, which have considerable inventories. The US, for example, may have a stocks-to-use ratio of over 20% at the conclusion of its marketing year in August.
Chile's walnut exports are seeing growth in several destinations, with Turkiye and India showing the most significant increase. In the first 11 months of 2022/23, Chile's walnut exports to Turkiye rose to 33,190 mt, up from 20,158 mt in 2021/22, while exports to India increased to 26,853 mt from 20,960 mt over the same period. This growth is at the expense of other suppliers like the US, as Chilean walnuts are competitively priced and offer high quality.
As the 2023/24 campaign begins, Tridge's representative in Chile, Tomas Nuñez, expects that Chile's walnut exports to the Middle East and India will continue to grow, but the European markets such as Spain, Italy, and the Netherlands will remain significant destinations due to the superior quality of Chilean walnuts. Chile can leverage its strengths of a counter-season harvest and high-quality walnuts. Chile's premium-quality walnuts differentiate it from the competition of China's expanding walnut industry and exports. The decline in freight costs during 2022 and early 2023 could further support exports, given the significant distance between Chile and many of its key markets.
Although the outlook for the 2023/24 marketing year in Chile is mostly positive, the country will face significant competition from China and the US, among others. China has been rapidly expanding its production, with a threefold increase over the last eight years to 1.4 million mt (in-shell) in 2022/23. As a result, China has also increased its exports, leading to intense competition, especially in the Middle East, where China has a significant presence. The US, the world’s largest walnut exporter, has large inventories due to a drop in global nut demand caused by high living costs and inflation. This will keep prices in Chile and globally under downward pressure. The Chilean 2023/24 campaign started with FOB prices ranging from USD 2.30-2.70/kg for in-shell walnuts.