June 2003 NEWSLETTER

8800 South Minturn Road
Le Grand California 95333 USA
Office 559-665-8500
FAX 559-665-8588

Almond Industry Position Report

Carry-in August 1, 2002
2002 Net Marketable Crop (Received to date)

May 2003 (Million Lbs.)

80.9
1,039.7

311.6
674.7

Total Sold

Uncommitted Inventory (Not Sold)

986.3

134.3

Position Report

Almond shipments continue to outpace the most optimistic projections for this 2002-2003 marketing year. For May, shipments set another record reaching 69.5 million lbs. compared to last year’s 54.4 million lbs. Total shipments now stand at a whopping 123.6 million lbs. ahead of last year’s record shipments for the same period with two months still remaining in our industry year. With total shipments now standing at 849.0 million lbs. reaching 950 million lbs. should be easily accomplished. The best news appears to be that this record billion pounds plus crop is being consumed upon reaching its destination and not being held for speculative positions.

2002 Crop Estimate

Most of you have heard by now that the subjective estimate handed down by the CASS was 920 million meat lbs. This 920 million-meat lb. estimate again for the second year in a row, is based on 530,000 producing acres. The industry’s reaction felt the number to be fair and accurate for now. The objective estimate is scheduled to be released by CASS on Thursday June 26th at 12:00 Noon.

Grower Appreciation BBQ

Last month we held our annual Grower Appreciation BBQ. Three hundred plus people attended helping to make the event a great success. There was great food, games, and lots of industry talk. It was nice to have the chance for our staff to meet and visit with those attending. Congratulations to the winners, each receiving a $100.00.

• Subjective Estimate – Lita Hering was the winner nailing down the subjective estimate for the second year in a row at 920 million meat pounds.
• Objective Estimate – Pending the release of the objective estimate on June 26th.
• Country Shipped - List in order top 10 countries importing Minturn Nut almonds. Miranda Zhang of Primex won by correctly picking 3 out of 10.
• How Many Almonds (in a 5-gallon water bottle) – David Davis won by guessing 10,772 kernels opposed to the exact number of 10,860 kernels.

Market Update What a difference a year can make! If any industry leader had predicted a year ago that:

• The 2002 almond crop would hit a record 1,083 million pounds.
• Almond prices would increase to $.40 and $.50 per lb during the year.
• Shipments would jump to 950 million pounds.
• The first subjective estimate for the 2003 crop would be 920 million pounds.

That leader would have been the laughing stock of the industry, even though all above points happened as the year progressed.
What are the reasons for the bullish turnaround in almonds? Here are a few thoughts:

• The industries decision to avoid a reserve, allowing marketing the whole 2002 crop.
• Relatively low initial prices for almonds in 2002 stimulated buying interest early in the year.
• The weakening of the U.S. dollar rendered almond prices even lower in Europe.
• The industry promoting nutritional value of almond consumption.
• The fact that almonds simply are a “darn good” product.

A milestone was reached with the 2002 crop year - as the first billion pound crop was produced and sold. The “unknown” has been conquered and today as supplies tighten against increasing demand, the market continues to show strength. Most of the handlers are in a holding pattern, waiting for the objective estimate. Based on the market levels today, grower prices would be the following: Nonpareil $1.52 - $1.55 with California types at $1.35 -$1.40.