California packers set a new June high for walnut shipments, providing further evidence that the industry is clearing the backlog of containers that had built up at the Port of Oakland earlier in the season.
Shipments for June reached 47,090 inshell equivalent (ISEt) short tons, up 13% from last June, according to the California Walnut Board’s latest shipment report released on Friday. It’s the third consecutive month packers have set monthly year-on-year records.
With two shipment months left to report in the crop year, U.S. packers are bullish that the 2022 carry-out could edge under 130,000 st if the current shipment rate is sustained. That would still exceed last year’s record carry-out of 98,000 st.
According to Stratamarkets calculations, if July and August shipments match those of the corresponding two-month period last year, the carry-out would surpass 136,000 st.
However, April-June shipments were on average 17% higher than last year. A similar performance in July and August would reduce the carry to under 125,000 st.
The June shipment report showed another bright spot in new monthly sales, which were 25,837 ISEt, up 8% from last June and 88% higher than May. U.S. packers have been focusing on clearing their remaining current crop stocks at competitive prices to prepare for the harvest, which starts in August.
June inshell shipments more than trebled on the year to 9.1 million lbs, boosting crop year-to-date shipments to 246 million lbs, which are still 32% behind the year-ago period.
The increase was primarily driven by a surge in shipments to Turkey. California shipped 4.8 million lbs to the country in June, compared to just 264,552 lbs a year earlier.
Market sources said Turkish buyers are beset by currency issues as the U.S. dollar continues to strengthen and are substituting Chilean inshell for less expensive alternatives such as U.S. current crop material.
“The U.S. is offloading their remaining inventory cheap instead of paying for cold storage. [Packers] want to clear inventory before new crop which is expected to be bigger than last year,” said a Middle East-based trader.
June kernel shipments increased by 5% on the year to 37.3 million lbs. Crop year-to-date kernel shipments are now only 1% behind those of a year ago.
Germany continues to account for the lion’s share of the kernel export market, with 6.6 million lbs shipped to the European country in June, more than double those of the previous year.
U.S. domestic shipments in June were disappointing, down 18% on the year at 16,585 ISEt.