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Tree Nut Situation Updates
This report updates the tree nut situation for selected countries published in the November 2001 issue of World Horticultural Trade and U.S. Export Opportunities.
Overview of Global Production & Trade
Almond production in selected countries in 2001/02 is forecast to increase 21 percent to 481,335 metric tons, due to increased output in all major almond-producing countries. As a result, total world almond supply has increased to 597,876 tons and total exports from selected countries in 2001/02 are forecast to increase 6 percent to 310,778 tons. U.S. almond exports are forecast at 249,478 tons, 4 percent above last year, due to a much larger crop. Spain expects an 11-percent increase for their almond production in 2001/02, due to favorable weather conditions in most growing areas. Exports in 2001/02 are forecast at 55,000 tons, up 9 percent from last year, due mostly to the larger crop. While there is no price support program for tree nuts, the EU does have an improvement plan that is implemented in Spain’s almond sectors. Up to 475 Euros/hectare may be provided to growers to plant improved, higher-yielding varieties.
U.S. almond
production in 2001/02 is forecast at a record 370,135 tons, a 22-percent
increase from the previous year. This
increase in output is based on 212,461 bearing hectares, a 5-percent increase
from 2000/01. Total U.S. almond
supplies in 2001/02 are forecast at 418,053 tons, up 9 percent from the
previous season, due to the large increase in production.
With the cyclical nature of almonds, the 2001 season began with growers
expecting a much heavier set than last year.
However, weather conditions have been less than ideal, resulting in
reduced expectations for the 2001 crop. Low temperatures and rain during the
critical bloom period decreased the ability of bees to successfully pollinate
many orchards across the producing areas of California.
Despite the poor weather conditions, yields are expected to be 2
percent above the previous record of 361,362 tons set in 1999.
As a result
of the expected increase in world production of almonds in 2001/02, U.S.
almond grower prices are expected to decline from the 2000/01 levels.
U.S. almond grower prices have been declining tremendously during the
last five years. From 1996/97 to 2000/01, U.S. almond prices have dropped by
51 percent. Low world almond
prices do, however, encourage consumption and in the past, have boosted U.S.
exports to record levels. For
this reason, it is forecast that 2001/02 exports will reach a record 310, 778
tons.
The United States Department of Agriculture forecasts U.S. almond exports at 249,478 tons for 2001/02, based on industry information. Low world almond prices are expected to boost exports. In 2000/01, shelled almonds, including prepared and preserved, accounted for 91 percent of total U.S. almond exports. Major buyers of U.S. shelled almonds were the European Union (primarily Germany, Spain, and the Netherlands), accounting for 53 percent, and Asia (primarily India, Japan, and China) purchasing 29 percent. Asia is the most significant importer of in-shell almonds, purchasing nearly 79 percent of total U.S. in-shell exports in 2000/01.
Competitor
Countries
Italy’s almond
production for 2001/02 is forecast at 20,000 tons, double last year’s meager
crop. Weather conditions in Italy
have remained very favorable during the whole season and trees are expected to
produce at almost their maximum capacity.
Furthermore, some observers tie the production increase to the cyclical
crop fluctuation, which is more pronounced in Italy’s aging almond trees.
Spain’s almond
production in 2001/02 is estimated at 59,000 tons, due to favorable weather
conditions in most growing areas. Exports
in 2001/02 are forecast at 55,000 tons, up 9 percent from last year, due
mostly to the larger crop. Other
European Union (EU) countries (Germany, France, and Italy) purchase about 93
percent of Spain’s exports. Almond
imports in 2001/02 are forecast to increase 31 percent from last year.
The United States continues to be the dominant foreign supplier of
almonds to Spain. While there is no price support program for tree nuts, the EU
does have an improvement plan that is implemented in Spain’s almond sector.
Up to 475 Euros/hectare may be provided to growers to plant improved,
higher-yielding varieties. While
this program was expected to end in 2001, Spanish nut growers secured a
one-year extension. Spain’s
government and industry seek another extension of the program until the
implementation of the new fruit and vegetable regime, which is scheduled in
principle, to take place in 2003.
Overview of Global Production & Trade
Walnut
production in selected countries in 2001/02 is forecast to increase 4 percent
to 706,416 tons, due to a major increase in output in the United States.
Consequently, total world walnut supply has also increased to 830,208
tons in 2001/02. Total exports
from selected countries in 2001/02 are forecast to increase 2 percent to
184,225 tons, due to higher production in the United States. U.S. walnut exports are forecast at 100,225 tons, 3 percent
above last year due to a much larger crop.
China
has seen its walnut production surge for the last several years because of
increased planting and bearing acreage, improved walnut varieties, and better
tree management. Walnut
production in 2000/01 surpassed the initial forecast by 10,000 tons.
India expects a 10-percent drop from last year’s record crop due to
lower yields caused by early-season droughts and the trees’ alternating
bearing pattern. Adequate rains
averted a much larger decline in March and April, which supported the crop
during flowering and fruiting (April/May).
Turkey expects the 2001/02 walnut crop to reach 68,000 tons, a slight
decrease from last year. This was
due mainly to unusually hot and dry weather conditions.
The 2001/02 U.S. walnut crop is forecast at 254,016 tons, 17 percent above last year’s crop, due to the alternate-bearing nature of the crop. U.S. exports in 2001/02 are expected to reach 100,225 tons, up 3 percent from the previous year, due to higher production and strong worldwide demand. In 2000/01, U.S. grower prices increased 37 percent from the previous year, reversing a three-year declining trend. The major increase in U.S. production of walnuts forecast for 2001/02 is expected to lower grower prices once again. However, this should spur world consumption and contribute to higher levels of U.S. exports in 2001/02. Shipments to Mexico, Australia, Egypt, and some Latin American countries were down in 2000/01 from 1999/00 but were up for Canada, Japan, Israel and the major European markets. The 2001/02 walnut crop is on the way to being the second largest on record and is expected to contain the best quality of any walnut crop harvested in California. This large quality crop, combined with support from the Market Access Program (MAP), as well as publicity following the publication of several studies showing the health benefits associated with walnut consumption, are expected to translate into a good export year for walnuts. Exports to MAP‑targeted countries of Canada, Germany, Italy, Israel, Japan, Korea and Spain are all slated to grow from 5 to 20 percent over the next 3 years. Spain, Japan, and Germany are still the top three markets, reflecting the strong consumer base in these countries. Also, Germany is the traditional trade center for nuts.
China
has seen its walnut production upsurge for the last several years because of
increased planting and bearing acreage, improved walnut varieties, and better
tree management. Walnut
production in 2000/01 surpassed the initial forecast by 10,000 tons.
This was primarily due to the bearing cycle of walnut trees in Southern
China and to very favorable weather conditions.
However, walnut production in 2001/02 is forecast at 310,000 tons, the
same as last year.
India
expects a 10-percent drop from last year’s record crop due to lower yields
caused by early-season droughts and the trees’ alternating bearing pattern. Adequate rains averted a much larger decline in March and
April, which supported the crop during flowering and fruiting (April/May).
Tighter supplies and strong export demand are likely to keep domestic
prices firm, resulting in some consumer shift from walnuts to imported U.S.
almonds during 2001/02. However, next year’s walnut crop should be much
larger due to the high yielding phase of the alternating bearing pattern and
the maturation of new trees.
Turkey
expects the 2001/02 walnut crop to reach 68,000 tons, a slight decrease from
last year, due mainly to unusually hot and dry weather conditions.
Walnuts grow naturally throughout most of Turkey and in the past, they
were generally not cultivated but simply harvested from natural forests.
However, during the last couple of decades, increasing demand and
prices have made walnut cultivation more attractive, leading to increased
investment in cultivation. The lack of a systematic crop survey and widely divergent
estimates from government and non-official sources make it difficult to
accurately estimate production. However,
sources expect walnut production to rise gradually in the next 3-5 years, as
new trees with improved varieties reach bearing age and acreage is increased.
Per capita consumption is relatively stable in Turkey, with 50 percent
of production used for home consumption and the remainder marketed.
Most
of the marketed walnuts are consumed whole, with only a limited amount being
processed. Walnut trade is very limited; most imports are inexpensive, lower
quality nuts from neighboring countries, while exports are usually higher
quality domestic nuts.
Hazelnut production in selected countries in 2001/02 is forecast to increase 31 percent to 801,545 tons, due to increased output in all major hazelnut-producing countries. Total world hazelnut supply has also increased from 998,168 tons in 2000/01 to 1,061,456 tons in 2001/02, due mainly to the large increase in world production and Turkey’s larger carryover stocks. Total exports from selected countries in 2001/02 are forecast to increase 12 percent to 521,950 tons, due to higher production in all countries. U.S. hazelnut exports are forecast at 27,750 tons, 73 percent above last year, due to a much larger crop. Future world production and supplies will be strongly influenced by the outcome of Turkey’s implementation of reforms in conjunction with the International Monetary Fund (IMF), that will gradually phase out its hazelnut support price. Turkey is the world’s largest hazelnut producer, accounting for about 70 percent of world supply.
United
States
Based
on the recent Oregon Objective Measurement Survey, U.S. hazelnut production in
2001/02 is forecast at 43,545 tons, up 92 percent from the previous year’s
harvest and 26 percent above the 1999/00 production.
Oregon produces almost the entire crop, except for an estimated 270 tons
from Washington. Oregon’s
production is expected to be a record for the second time in four years.
Exports in 2001/02 are forecast at 27,750 tons, up 122 percent from the
previous year’s shipments, due to the much larger output.
However, U.S. exports will face substantial international competition
from lower-priced Turkish product, as Turkey gradually phases out price supports
to FISKOBIRLIK (The Union of Hazelnut Sales Cooperative).
Hazelnut prices are expected to remain relatively stable, despite higher
production.
Competitor
Countries
Turkey’s
2001/02 crop
is estimated at 600,000 tons, up 22 percent from last year, due to favorable
weather conditions before harvest. Hazelnut
production is one of the most important economic activities in the country,
employing an estimated 385,000 growers. Most
of these grow hazelnuts to supplement their primary income, own about 1 to 2.5
hectares, and use family labor at harvest. Only a few large growers rely on
hazelnut production as their primary income.
There are approximately 536,000 hectares in production, although this is
difficult to verify, given the lack of systematic crop surveys.
Following
through on its commitments to the International Monetary Fund to reduce
inflation, the Government of Turkey (GOT) is trying to reduce the large
production surplus, by gradually lowering the hazelnut support price.
On August 18, 2001, the general director of FISKOBIRLIK announced the MY
2001/02 procurement prices, which are differentiated by the type of hazelnut.
Levant type hazelnuts, which are an estimated 70-80 percent of the total
production, will receive the support price of TL 1,500,000 ($1.06/kg), compared
with last year’s price of TL 1,100,000 ($2.30/kg). The announcement has not been well received by growers.
Although the MY 2001 price is 36 percent higher in nominal terms that it
was the previous year, inflation was 65 percent during the last 12 months and
devaluation of the Turkish Lira was about 225 percent.
FISKOBIRLIK is expected to procure between 100,000 and 150,000 tons of
hazelnuts in 2001/02, although the quantity purchased will be determined by the
amount and timeliness of payments provided by the Turkish government.
Turkey
accounts for more than 80 percent of the world hazelnut trade and, through
FISKOBIRLIK, largely determines world export prices.
Indicative export prices in early August were around $280.00 per 100
kilograms compared to $300.00 a year earlier.
Export prices dropped recently to $225.00 after FISKOBIRLIK announced the
new procurement price. In 2001/02,
exports are forecast at 420,000 tons, up 4 percent from last year.
Although 78 percent of Turkish exports go to the EU, Turkey is trying to
expand markets in Asia, the former Soviet Union countries, as well as the United
States, where it is involved in a joint promotion program with U.S. growers to
increase U.S. hazelnut consumption. About
70 percent of Turkey’s hazelnut exports comprise raw kernels, with the
remaining 30 percent being processed kernels, including roasted, sliced, and
chopped hazelnuts, paste, meal, and flour.
Italian hazelnut production in 2001/02 is estimated to be 135,000
tons, 63 percent above last year’s poor crop, due to cyclical crop fluctuation
and favorable weather conditions. Imports
are expected to decrease 25 percent, due to increased production.
Imports of shelled hazelnuts from the United States and Turkey dropped to
zero in 2000/2001, due to the cheap price of Turkish product and increased
supplies of competing hazelnuts from the EU.
Exports for 2001/02 are forecast at 3,000 tons, 36 percent above last
year’s level, due to the larger crop. In
2000/01, exports fell by 14 percent, due primarily to aggressive Turkish
competition in Italy’s main hazelnut export markets (Germany, France, and
Switzerland). Reduced domestic
supplies in 2000/01 (due to the poor Italian crop) strengthened the market, and
prices of Italian hazelnuts averaged about 13 percent more than the previous
year, despite the increasing imports of shelled hazelnuts from Turkey.
The forecast of large crops both in Turkey and Italy, on the other hand,
will likely depress the market during the next marketing year.
The
EU program favoring domestic hazelnut producers (which provided payment of 15
Euros per 100 kg, in-shell basis) has expired and the EU has adopted no new
support actions, despite strong grower support for these measures
to counteract competition from Turkey.
The EU Commission will probably produce a draft proposal by the end of
this year, to be discussed by the Council next year, although budget constraints
will limit the impact of such a new policy initiative.
Spain’s
2001/02
hazelnut crop is estimated to reach a record 35,000 tons, more than double last
year’s crop of 16,000 tons, due to the crop’s alternate bearing cycle and
unusually rainy weather during the summer of 2001.
Hazelnut exports are expected to increase and imports are expected to
decrease as a result of the much larger crop.
The United States represents about 5 percent of Spain’s total hazelnut
imports and continues to face stiff competition from lower-priced Turkish
product, which accounts for 65 percent of Spain’s imports.
All Turkish hazelnut exports to Spain are shelled, while U.S. exports are
in-shell. The bulk of the hazelnut
crop is consumed in-shell, with the confectionary and chocolate industries
consuming 60-70 percent of total supplies.
While there is no price support program for tree nuts, the EU does have an improvement plan that is implemented in both Spain’s hazelnut and almond sectors. Up to 475 ECU/hectare may be provided to growers for varietal improvement of their orchards. The Government of Spain and industry continue to seek an extension of the Program until the implementation of the new fruit and vegetable regime begins, in principle scheduled for 2003. Spanish nut growers have argued for an extension of this program. Given competition from Turkish product, Spanish hazelnut growers consider this program vital to their future competitiveness and are expected to oppose the most recent EU proposal for reform of the fruit and vegetable regime, which calls for a significant cut in subsidies.
(For more information on production and trade, contact Erik Hansen at 202-720-0875. For information on marketing, contact Ingrid Mohn at 202-720-5330. Also, please visit the tree nuts commodity page: http://www.fas.usda.gov/htp/horticulture/nuts.html for the latest information on almonds, walnuts, pistachios, hazelnuts, pecans, and macadamia nuts.)
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