Prices steady as market focuses on inshell trade

September 21, 2022

Inshell trade activity livened after a slow start in the global almond the week ending Tuesday on demand from India ahead of a key almond consumption period in the country.

Market participants reported 30 inshell trades to Stratamarkets during the September 13 to September 20 assessment period,  two-thirds of which transacted in the final three days of the period. Participants expressed optimism that almond demand in India as its Diwali festival nears could energize an otherwise moribund market.

“Let’s hope this is the start of the Diwali buying season,” a Fresno County packer said on Tuesday.

Despite the uptick in activity, NPIS lost 2 cents on the week while INIS fell 1 cent. Market participants cautioned that inshell trade activity with India remained slower than usual for this time of year.

Kernel prices, meanwhile, showed marginal gains and losses in thin trade as buyers and sellers largely refrained from business. Buyers in most destination markets have inventory to draw upon and most sellers in California appear equally uninterested in trading.

“Most of our growers can wait and they don’t like the prices they’re seeing right now,” a call-pool packer in San Joaquin County said on Tuesday. “They’ve got their heads down with the harvest. They’re not thinking about marketing.”

The Stratamarkets Almond Index ended the week unchanged at $2.09/lb FAS, down 85 cents from its year-ago value.

STD5 and SSR

Trade activity for STD5 and SSR-grade items ticked up after grinding to halt the previous assessment period. However, trade for the items remained subdued compared with previous years.

STD5 traded from $1.65/lb FAS to $1.72/lb FAS, edging higher as the period progressed. Offers were left at $1.72/lb FAS.

Sized SSR-grade items traded from $1.70/lb FAS to $1.86/lb FAS depending on variety and size. The average trade value for the group was $1.82/lb FAS, a 12-cent premium to STD5.

Buyers and traders in Europe managed burgeoning stocks at their warehouses as fresh containers continued to arrive and limited demand in local markets slowed the rate of drawdown.

“All I’m concentrating on at the moment is selling what we have in stock,” said a U.K.-based trader.

With packers reluctant to lower 2022 crop offers, the old crop discount to new crop is widening. By Tuesday, afloat containers of 2021 crop STD5 were offered at $1.65/lb CIF Valencia, which nets back to a FAS equivalent price of $1.51/lb, a 20-cent discount to 2022 crop.

A Germany-based trader said that plentiful European stocks and buyers’ concerns about their ability to move them quickly meant that prices of Spanish-origin almonds could come under pressure due to a lack of interest for Spanish new crop as it competes with old crop inventory.

“Once the difference is too large even quality buyers may throw concerns overboard and take old crop, especially given the current economic circumstances,” the trader said.

A trader in Spain said some European buyers of STD5 may be tempted to substitute their purchases with Unselected Valencia, the nearest equivalent Spanish processing-grade product.

According to Stratamarkets calculations, a shipment of 2022 crop STD5 at the assessed price of $1.70/lb FAS would land at Valencia at a DDP price of $1.91/lb (Eur 4.23/kg). Prompt trucks of 2022 crop Unselected Valencias are currently available at Eur 4.20/kg DDP Valencia, the Spanish trader said.


Unsized NPIS traded from $1.64/lb FAS to $1.72/lb FAS while unsized INIS traded from $1.43/lb FAS to $1.46/lb FAS. Multiple trades were also transacted on a delivered India basis and for guaranteed sizes.

The NPIS price premium to NPX 27/30 remained enticing for sellers even though it narrowed to 15 cents on Tuesday from 21 cents the prior week.

The INIS premium to INX 23/25 appeared less tempting for sellers. After trading at a premium since February, it switched to a discount in August. That discount widened on Tuesday to 7 cents from 5 cents the week prior, underscoring the tepid demand for INIS in India.

Demand for the item is weak because buyers prefer NPIS at current price levels. But if NPIS prices firm, demand in India could begin switching to INIS, a broker in India said.

Packers remain optimistic that the 39% drop in Californian almond supply to India in August plus an expected pick-up in local buying ahead of Diwali in late October will incentivize inshell demand.

“[Buyers] might want to see how Diwali sales go and their buying for that in the local markets happens in the second half of September,” said a U.S. packer.

However, one Indian trader said most importers were well-stocked for Diwali and were selling into the local market “at break-even or a slight loss.”

As a result, the majority of importers in India were mainly focused on buying a limited number of 2022 crop containers from California for forward periods rather than purchasing for immediate shipment.

“The old crop discount is increasing, and U.S. shippers want to sell prompt because they have old stock in the warehouse and current crop is in full flow,” the trader said. “They need storage and cash flow.”

A second Indian trader said some importers in India had ample stocks of almonds in cold storage ready to withdraw when prices in the local market firm.

“So most interest for U.S. imports is further out,” the second trader said. “People want goods which they can use in December, January, and February.”

Extra and Supreme

Most Extra-grade prices firmed on the week.

NPX 30/32 to 23/25 traded from $2.05/lb FAS to $2.50/lb FAS depending on size. The average transacted price for the group was $2.36/lb FAS, a 54-cent premium to the average SSR-grade price.

Most NPX trade activity focused on NPX 23/25. No trades were reported for NPX 20/22.

INX 27/30 to 20/22 traded from $2.10/lb FAS to $2.33/lb FAS depending on size. The average transacted price for the group was $2.19/lb FAS.

Supreme-grade assessments fell marginally on the week. CTS 27/30 and CTS 23/25 traded from $1.94/lb FAS to $2.03/lb FAS.

Despite multiple NPX kernel offers into the Middle East, market sources said that the support for NPX prices likely stemmed from a lack of large size Nonpareil kernels in the carryover and reluctance on the part of sellers to lower their new crop NPX offers.

“Even if [the Middle East] isn’t buying a lot, why lower your price?” a U.S.-based trader said. “It’s probably not a price issue for [Middle Eastern buyers] at the moment.”

Market sources said a nearly sevenfold month year-on-year increase in Californian kernel shipments to North Africa in August surprised them. Morocco accounted for the lion’s share of the rise, taking over 7 million lbs in August, up from just over 1 million lbs a year earlier.

A Madera County packer said the jump in shipments to North Africa could be the result of expectations of a reduced Spanish crop this harvest due to heavy frost during bloom and high temperatures during harvest.

“But it could also be the availability of protein,” he said. He added that heavy falls in food grade wheat production this year, which raises the prospect of food shortages in some countries, could incentivize almond buying as a protein substitute.

A Spain-based trading source said that while Morocco was a significant market for Spanish-origin kernels, this trade flow decreased as customs tariffs on U.S. origin almonds were progressively eliminated as part of a free trade agreement between the two countries that began in 2006.

Since 2022, U.S. almonds can be exported to Morocco free of quotas.