Almond oil Update – Live from Sicily!

25. June 2014

An account of the continuous rise in demand for pure and genuine PhEuro and MR qualities, as well as organic Almond oil we have joined forces with our strategic supply chain partners PARODI NUTRA and FRATELLI PARODI and set forth on an extensive journey with a personal inspection of the main Almond growing regions in Italy. We gained extremely useful insights on the ground. The most important findings on our field trip:

  • Our itinerary covered the most important growing regions: we started in Campomorone near Genoa. This is where the PARODI NUTRA and FRATELLI PARODI head offices and processing facilities are located. The journey covered the southern part of the Emilia-Romagna, Umbria and Abruzzo regions. We are pleased to report that we witnessed that many trees are being planted in these strong agricultural backlands.
  • In addition to Almond trees we also got acquainted with farms and cooperatives that are already planting or intend to plant Apricot, Walnut and Peach trees next to their Olive trees.
  • Subsequently we continued to concentrate on the main existing growth regions in Puglia, Calabria, Basilicata and of course Sicily; especially in this region we are pleased to be able to rely on longstanding and particularly loyal and reliable supply partners. This is both true for the entire Almonds which are used for outstanding Ph Eur 8.0 grade as well as the Oilstock which we use to process the Almond MR quality
  • The weather conditions during the past weeks was particularly good! And on the grounds of plentiful sunshine during the early summer days we are equally positive about the upcoming months where the nuts and trees are maturing prior to the harvest later this summer and early autumn.
  • The rainfalls in the Spring resulted in abundant soil-moisture; with long days with lots of sunshine the fruits have now developed strongly; which means that we can be optimistic that the output should be at least that of last year, possibly better!
  • Because this is still very early we cautiously rate this current crop analysis as positive; as we should expect that nut and oil yields will continue to develop within expectations. On that basis we have continued to build up and develop our supply chain and secure the volumes and qualities that we need. Especially in view of the poor outlook and low availability of the Californian and Spanish growing regions the supply chain from Italy will continue to grow in importance for the European market.
  • We must forewarn and limit our optimistic outlook because we do not foresee that the underperformance of US / California and Spanish Almonds and Almond oil can be compensated by the Italian supply chain alone! The new trees will surely take a good few years, before they can carry yields which can bridge the supply gap!
  • Decisive for the upcoming 2014/15 harvest and supply season will now be how much precipitation the trees will still receive and how well the nuts can mature in the final ripening stage. First evidence of the current stage of this years’ growth is shown in the photos underneath.

In summary:

  • All in all the Almond blooming phase is now completed.
  • A tentative forecast indicates that the 2013 crop could be increased by 5-8%. This gives us at least some reference points when we are considering our cover plans for 2014 and the New Year. Notwithstanding this basic outlook we forecast that the Italian volumes in addition to the US and Spanish volumes will not bring a balanced supply chain this upcoming season!
  • The continuously increasing demand from all over the world supersedes supplies, even though the area under cultivation has actually grown by more than 50% during the past 10 years.

The head of our specialties division Mr. Klaus van Zoggel summarizes the situation in Italy as follows: „The international Almond market will remain tight till the end of the 3rd Quarter 2014 – possibly leading into the 4th quarter 2014, i.e. at least until such time when the new harvest is dried and safely stored in the sheds. Full nuts for our Ph Eur 8.0 quality remain scarce! Equally the supply chain for the organic Almond varieties will remain tight until we have fresh crop material available. The prices will remain firm, especially in view of the prolonged drought which ruled over the main growing regions in California. With so much uncertainty in the market we advise fully cover to ensure contract cover. From October/November onwards it everything is open again”.

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