Doubled nut sales needed to sell record 2016 pistachio crop

Doubled nut sales needed to sell record 2016 pistachio crop

“Generally, in an on-year like this one, it’s difficult for the nuts to mature evenly throughout a tree. But, this year those differences were more extreme, especially in areas where we saw whole nut dry down and early splits. We think this occurred because the trees are still recovering from the impact of drought and overall crop load which was breaking limbs.”

By the time they brought in the last of their 2016 harvest in mid-October, California pistachio growers, who produce 98 percent of the U.S. crop, set a new record – a whopping 902 million pounds (in-shell), according to the Administrative Committee for Pistachios.

This amount would shatter the previous record of 555 million pounds which American pistachio growers harvested in 2012. While this year’s production was consistent throughout the pistachio-growing region, it will not set a record in terms of yield per acre.

Production this year in the other two pistachio-producing states - Arizona and New Mexico - totaled 6.5 million pounds.

This year’s California production feat reflects a combination of more favorable weather than last year, a 2016 on-year crop, and about quarter-million acres of trees now in commercial production, says Andy Anzaldo, vice-president of grower relations at Wonderful Pistachios.

Meanwhile, as the crop size grew larger, Anzaldo says crop quality declined. He attributed this in part to an unusually wide range in the timing of the crop ripening.

“Generally, in an on-year like this one, it’s difficult for the nuts to mature evenly throughout a tree,” Anzaldo says. “But, this year those differences were more extreme, especially in areas where we saw whole nut dry down and early splits. We think this occurred because the trees are still recovering from the impact of drought and overall crop load which was breaking limbs.”

However, the largest factor in lowering 2016 crop quality was the abnormally high amount of shelling stock. While the quality of the kernels is unaffected, the shells are not marketable.

“The shells were over-dry, dark, or crinkled,” Anzaldo explains.

“Typically, shelling stock levels are in the 3 percent to 4 percent range,” he says. “This year shelling stock accounted for as high as 10 percent in some loads. This seemed to be more pronounced in Kern County and other areas where drought (had) impacted production the last few years.”

The closed shell percentage was normal in Kern County, he notes. Yet in Tulare, Madera, and Fresno counties, the percentage ranged up to 25 percent. This is much higher than the 15 percent average.

“These quality issues are important from a marketing perspective,” Anzaldo says. “While the crop is a record 900 million or so pounds, the marketable split in-shell will be 10 percent to 20 percent less because of the high levels of shelling stock and closed shells.”

Anzaldo reports that pressure on this year’s crop from disease, including botryosphaeria and late-season alternaria, was low.

The nut percentage rejected due to Navel orangeworm or other insect infestation was lower than usual at the start of harvest due to the use of pheromone puffers which disrupt mating, and the early harvest. However, as harvest progressed into the late stages, the amount rose to higher than average.

“We suspect the early-hull split nuts were harboring a flight of Navel orangeworm,” Anzaldo says. “When the flight came on in mid-September, growers didn’t have any protection in place for the nuts. The industry will be asking at the Navel orangeworm summit on Nov. 14 what could have been done better to protect the crop at that late point in the season.”

The meeting for growers and pest control advisers titled ‘Using Navel Orangeworm Pheromone Traps: Tips- Strategies and Future Applications’ will be held Nov. 14 from 8 a.m. to 1 p.m. at the University of California Kearney Agricultural Research and Extension Center in Parlier.

For more meeting information, contact Kris Tollerup at (559) 646-6527 or ketollerup@ucanr.edu.

For Wonderful Pistachios growers, harvest started Aug. 19 with some tree shaking in Kern County. Within 10 days, harvest was underway for most California growers, Anzaldo notes.

The company processes the crop at two facilities in the Lost Hills area, and two plants in Coalinga and Firebaugh. During the main harvest rush over a 27-day period, growers delivered nuts at the average rate of 1,079 truckloads per day, he says. Processing volume for a single day peaked at a company-record 1,144 truckloads.

“Over the last three years, we’ve invested $300 million in our plants to process the growth in annual production as the number acres of bearing trees increases,” Anzaldo says. “That paid off, because we were able to process this year’s crop without any major interruptions.”

Now, with the huge 2016 crop in, the industry faces the formidable challenge of marketing the pistachios at home and abroad. In fact, the stock of pistachios on hand at the end of the 2016 harvest is twice as large as it was after last year’s harvest wrapped up.

“Because of the difference in size between production in 2016 and 2015, the industry will have to double the volume of sales, compared to last year, to market the new crop through the current marketing year, and carry over a reasonable amount of pistachios to balance an expected off-year in 2017,” Anzaldo says.

Not surprisingly, the market price of pistachios has fallen but not as much as expected. He says the opening grower price for the 2016 crop is $1.80 per pound (in-shell) – or 70 cents less than last year’s opening price.

Lower prices should help move the new crop, he notes, as should rebounding demand in China, the single largest international market for California pistachios.

In addition, Wonderful Pistachios has launched a $55 million dollar advertising program to boost U.S. pistachio sales. Featuring the Ernie the Elephant cartoon character with audio voice over by television personality John Cena, the television campaign debuted in early October during a Monday Night Football broadcast.

“Combined with the lower prices, this increased marketing effort is designed to double pistachio sales this year and bring final prices back to above the $2 level,” says Anzaldo.

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