The Californian Objective Estimate is calculated by sampling nut counts across a variety of areas in Californian. The bearing acreage is then multiplied by the yield. The yield is calculated using the samples that are taken across California. The 2017 Subjective estimate used a bearing acreage of 1,000,000 and a yield of 2,200 pounds per acre.
For a more in depth explanation of the sampling procedures please click on the links below.
http://www.almonds.com/sites/default/files/content/attachments/201606almom.pdf
2016 Objective report
http://www.almonds.com/sites/default/files/content/attachments/almondomfor2016.pdf
What can we expect?
The Initial Subjective forecast, released in May, estimated the 2017 almond production at 2.2B lbs. This number was generally seen as towards the lower end of the industry’s expectations. Both buyer’s and seller’s believed the production would be greater than this and therefore the market was not pushed up.
As it stands today we can sum up as follows –
Taking commitments into account, current crop is well sold: 86-93%.
New crop appears to be unsold for this time of year – only 10-15%.
The market appears to be finely balanced at the moment. We know there is little sold and bought forward and it appears to be a case of who blinks first, buyer’s or seller’s. We know prices are extremely competitive, especially when you compare them to other tree nuts. On the other hand with a possible record crop on the horizon, California will need to start putting forward sales on their books.
In our opinion a number lower than 2.25n lbs could be enough for buyer’s to start putting purchases on their books. A number higher than 2.27b lbs could see the market come off in order to stimulate buying interest.
Saying all this, it is clear that current prices do work for the industry and the reluctance to book forward is more to do with sentiment and the fear of buying something today that could be cheaper tomorrow. If however this trend is reversed then we could see a lot of buyer’s moving in to take advantage of the competitive prices.
The 2017 report will be published here as soon as its released around 6pm GMT 06/07/2017