A deteriorating short-term coronavirus outlook dampened demand in the U.S. FAS market during the week ending January 26, dragging almond prices lower.

Prices fell for 14 of 16 assessed items. Benchmarks STDS lost 5 cents on the week; NPIS shed 3 cents. NPX 20/22 registered the sharpest drop, falling 19 cents on the week. The only items that held were BP SSR 30/32, which ended flat, and NPX 25/27, which climbed 1 cent.

A coronavirus flare-up posed problems for buyers in multiple regions and contributed to the price retreat.

In China, new lockdowns are making it challenging to get almond containers into ports, said a broker in California with clients in China. A buyer in the U.K. said talk of a new strain there has further weakened almond demand in the hotel, restaurant, and café sector, which was already under pressure. A broker in Europe said headlines there about travel bans and travel restrictions are making buyers pause.

“I have a lot of offers from California, but I don’t have a lot of demand,” the broker said on Tuesday.

Prices softened gradually throughout the week. A fire at an almond packing and manufacturing facility in California prompted a brief price increase before prices continued their decline.

Stronger selling interest also contributed to last week’s fall. One U.K.-based trader said he saw deeper selling interest, which surprised him given the strength of the position report released earlier this month.

“I’ve never seen such a good position report being ignored,” the trader said. “It just seems like demand isn’t there.”

Other market participants said they noticed the opposite. A U.S.-based trader said offers were few and far between for her. A call pool packer, meanwhile, said growers in his pool were reluctant to sell.

“Growers seem to be sitting on their thumbs,” he said. “It just doesn’t seem like California is in a hurry to sell.”

Demand shrivels in most parts of the world

Buyers in the Middle East appeared to be the most active last week. Elsewhere, demand was muted. Demand for NPIS continued to soften in India. The item was seen bid at $1.65/lb FAS on a 70% sliding scale with offers 5 cents higher for prompt shipment amid light trading activity. A packer in California said Australia began to offer inshell almonds into the market in India at California-equivalent prices.

IIS was assessed at an 18-cent discount to NPIS. It typically trades at a 10-cent discount to NPIS. An importer in India said IIS supplies there are unusually high after importers over-purchased in November when prices were low.

“The Independence inshell in the domestic market is a disaster,” the importer said, referring to the low prices for IIS in India. “When importers saw the cheap prices, they all bought huge quantities.”

The importer added that if almond sales were heavy on Tuesday, which marked the country’s annual Republic Day holiday, almond demand from India in the U.S. FAS market could ratchet up quickly.

“If not, demand won’t come back until March,” he said.

Buyers in China remained quiet with Chinese New Year purchasing finished. Buyers there do not want new shipments to arrive until the end of February or March. A packer in California said he expects China demand to return soon after Chinese New Year next month.

“It’s dead for now,” the packer said. “But once Chinese New Year is over, they anticipate that their stocks will be empty, and they’ll come back and buy more.”

In Europe, trading companies sparked most of the buying activity, but not enough to support prices for STDS. Nougat manufacturers remained dormant. A broker in Europe said this month has been his slowest month for business in recent memory.

Now halfway through the 2020-2021 crop year, there was an uptick last week in buying interest for new crop almonds, with bids for multiple items seen for Q4 shipment.

A trade for STDS for Q4 shipment was heard but not verified at $2.02/lb FAS, which would put the new crop price premium to prompt at 6 cents.