On April 1–the day before U.S. President Donald Trump announced sweeping global tariffs on goods coming into the U.S.--Israel removed its remaining tariffs on U.S. product. It's a decision applauded by some U.S. produce exporters, including almond growers and shippers.
"It is a welcome decision now that the political tensions are easing off in the region. The zero tariff will increase the affordability of almonds, which will push the sales and demand in the region," says Bikram Hundal of Custom Almonds LLC.
Lack of growth in market
He notes that the industry's almond shipments to Israel are about 16 percent lower compared to last year at this time. To date, approximately 4 million lbs. have been shipped compared to last year's 5 million lbs. "We didn't see much growth in the market due to ongoing tensions with neighboring countries and the skepticism looming around it. There hasn't been much push into this market for the last two years due to the ongoing conflict," Hundal adds.
© Custom AlmondsHundal inspecting almond orchard last week in Tulare county.
This news comes when California is already managing a lower almond supply compared to last year. "This is even though the 2024 crop receipts were about 11.3 percent more than 2023," he says. "Thanks to the consistent shipment numbers, demand has been steady and strong overall. Going back to February's shipment numbers, we almost caught up to last year's shipment numbers," he says.
What also seems to be helping demand overall are reports that 2025 might be a shorter crop, which in turn has triggered buyers to buy almonds. "We have four months left to finish off the 2024 crop, and a consistent shipment number of 200+ million plus pounds will bring the carry in to a record low. We have seen a compound annual growth rate of 4 percent relating to demand. It is consistent with last year, and demand is growing," Hundal says.
Increase in almond pricing
That has pushed prices up almost $1/lb, and that too is welcome, given the returns over the past three years. Hundal says the cost of growing almonds has grown exponentially since the start of COVID-19 but also with water restrictions and the Sustainable Groundwater Management, SGMA, coming into place.
"Growers are finally seeing a light at the end of the tunnel with some incremental almond price increase. However, we need at least two years of sustainable pricing to be able to catch up for the losses for the past couple years," he says. "With SGMA coming into effect, acreage under production is reducing. The overall reduction in inventory and potential 2025 short crop have triggered a rise in price compared to other years, although retaliatory tariffs may suppress some demand."
Indeed, the tariff situation could also change again given on April 2, U.S. President Trump issued a 17 percent tariff on Israeli exports to the U.S.
In other export news, almond shipments to China were significantly lower by 47 percent compared to last year. "The primary reason is the price increase and the looming tariffs," says Hundal. "In general, we had exported 1.17 billion lbs vs 1.18 billion lbs from last year, which is just 1 percent behind–even though the price is almost 19 percent higher than last year. This shows the demand has been steady as long as we keep our production below 3 billion pounds."
For more information:
Bikram Hundal
Custom Almonds LLC
Tel: +1 (559)-346-8212
Office@sequoianut.com
www.customalmonds.com