US Walnut Market Update December 2021 Week 50
As we all know, November has been somewhat of a crucial month for the walnut industry. Since the record low numbers reported in October, many buyers and sellers hoped that November would change things for the industry. And change it did bring, though we don't think it's the one everyone was hoping for.
Overall Shipment Updates
For starters, the November shipments amounted to 81,727 tons in 2021 for in-shells, a 28% decrease from last year's 113,371 tons. For the 2021 crop alone, we've only shipped 191,558 tons compared to 246,190 tons for the 2020 crop. As you can imagine, this has led to a decline of 22.2%.
But we all know the reason behind this. However, this time around, in addition to the shipping problem, we're also looking at climatic issues which have caused delays.
Furthermore, there's been a bit of stagnation in the market due to the situation in Turkey. This is mentioned in our market insights from last week. Prices are decreasing for walnuts for the second half of January, which could explain the lack of interest in buying. Overall, there are many reasons behind how we've come to this point, and while the shipping crisis has a lot to do with the situation, there are other factors too.
US Crop Updates
With the harvest complete, the NASS has estimated the 2021 crop to be around 680,000 tons. As you can tell, this is a reduction from the 785,000 tons from the 2020 crop.
The US crops, in general, can be divided into two main categories: Pre-storm and Post-storm. The Pre-storm category consists of a good chunk of the Chandler crop, and they're in very good form. The color is good, and it will generally be accepted in all major markets.
However, for the Post-storm crop, we're not so optimistic. Since these were the crops that were not harvested before the rain in late October, they've turned out to be mediocre, at best. The plan is to crack the in-shell kernels so that they're acceptable and they will be packaged as dark combo kernels.
Market Pricing and Other Information
In general, the market's been quite bleak in the past month. Kernel shipments to Asia and Europe have increased by .27% and 26%, respectively. As mentioned, the shipping crisis, the weak Turkish Lira, unavailable containers, and the approaching season of Ramadan shows that this is unlikely to get any better. In-shells have been down by over 53% since September.
One of the reasons behind this worth noting is that most Middle Eastern countries purchased their stock of in-shell kernels from China this year which also impacted California's early shipments.
It is expected that suppliers will lower prices to increase demand in the short term. So, if you're interested in Californian walnuts, this will be a good time to find premium products for exceptionally competitive prices.
