Market Report July, 18 From Turner and Associates

WALNUT MARKET/CROP REPORT

CROP:

Walnut shipments continue to set monthly records with June shipments at 24,238 inshell equivalent tons; compared to 22,515 tons last June. This puts the total shipments to date at 463,683 tons, 49,635 tons ahead of last year to date shipments (414,048 tons). 

June shipments were 1,000 tons above my forecast and if my July and August forecast are on target, we could see a carry-over of less than 35,000 tons; 7,000 tons less than last year. However, the difference this year is most of the product is high quality and will be utilized to fulfill the packer’s bookings and obligations for July, August and September.

Except for the 650,000 pounds of Inshell shipped this month to Turkey/U.A.E, most of the tonnage was shelled products for the export and domestic markets.

At this stage, the 2011walnut crop looks impressive with most industry leader believing it will exceed last years record crop (502,000 tons).  It appears that some of the early varieties may have some blight brought on by heavy rains in the northern part of the state.  However, the majority of the orchards seem to have a heavy set with a lot of doubles and triples showing up on the branches.

The chandler crop appears to be robust again; however, the chandler nut sizes could be off again this year. The Tulare’s and Howards nut sizes seem to be average or slightly above. Also, I expect the Hartley crop to be down from the surprise 70,000 tons we had last year 

Over all, it looks these years ideal weather condition will produce a good California walnut crop with above average quality.  Some believe this could also be the case with the China 2011walnut crop.

I will forward an industry “subjective” crop estimate to you by end of month.

California Walnut Shipments Recap (000)

Month (June)         2009/10      Year to Date      2010/11    Year to Date     Percent

In-shell (lbs.)               1,433           204,092              1,184         280,658          37.5%

Shelled (lbs.)             19,269            275,810            20,572        281,318          01.2%

Total Tons                22,515            414,048            24,238        463,683          12.0%

Market:

Bookings have dropped off somewhat for prompt shipments; however, new 2011 crop inquires for inshell chandlers and other shelling stock varieties has been exceptionally active for this time of year.  As a matter of fact, I cannot remember new crop booking request coming this early before harvest.  The pre harvest chandler pricing has been on both sides of $1.65 with some packers and buyers taking limited positions at these levels.

Not sure if the heavy pre-crop bookings is a good idea or not for either the sellers or buyers. But, I have to believe this will make for a wild and active market opening once the official crop estimate comes out on September 1^st.

The current crop offerings for Light Halves and Pieces continue in the $4.30 range with Combo material approximately $0.15 less.  Not aware of any In-shell Chandlers business taking place as I believe the inventories have been completely depleted.

Let me know if you have any questions or comments.

Kind regards,

Pete