Declines in fertilizer prices from 2022 highs and an improvement in California’s water supply suggest the upcoming fruit and nut season could be a good one for growers. 

The U.S. Fruit and Tree Nut Supply-side and Export Outlook report published by Rabobank suggests many of the factors challenging producers in the 2022-23 growing season – elevated input costs, logistical challenges, and an overabundance of supply – are leveling off for the new season. 

Global fertilizer prices skyrocketed after the invasion of Ukraine and the sanctions that followed in early 2022. Since the third quarter of 2022, fertilizer prices have begun stabilizing as markets move to more realistic supply and demand levels. The report suggests there could still be “bumps in the road” ahead as demand ramps up for planting season. 

California – home to two-thirds of the U.S. fruit and tree nut production – received between 120% to 200% of historical rainfall average totals to date in 2023, allowing reservoirs and aquifers to replenish after several years of extreme drought. Precipitation levels could be of benefit during the upcoming growing season and multiple years ahead for farmers who maximize water banking for future years. 

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Tree nut exports did not maintain pace with U.S. production in 2022, keeping prices under pressure due to increased inventories. This dropped the export value by 5% from the record-setting export value high in 2019 despite a 12% tree nut production volume increase during the 2022/23 growing season.

Exports of U.S. tree nuts are recovering this year with almond shipments increasing about 12% year-over-year through March, walnut exports increasing 25% in January over the previous year and pistachio trade growing 7% YOY through February for the 2022/23 marketing season. 

The report, authored by RaboResearch analysts David Magaña, Xinnan Li and Samuel Taylor, adds that “adopting innovations to increase production efficiencies will be key to remaining competitive in the tree nut and fresh fruit markets.” 

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