West Coast Nut September 2019

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production. The analysis takes yield
variability into consideration and
assumes there will be no interruptions
to the alternate bearing nature
of yields.
Whereas a colder spring may delay
pistachio maturity this year, some
expect this to be an exceptional “off ”
year. For 2019, the estimated average
yield of about 2,900 lb/acre would
result in an expected production of
just below 850 million pounds. For
2024, the estimated average yield of
about 3,700 lb/acre would provide
expected production of about 1.37
billion (bn) pounds. Accounting for potential variability,
Rabo AgriFinance estimates that there is a 50 percent probability
that production will be between 1.29bn and 1.46bn
pounds in 2024 (Figure 2).
Demand Growth Is Necessary
Demand continues to grow, as pistachios fit into the
category of a healthful, convenient and tasty snack. China
is the main export market for U.S. pistachios, followed by
the European Union (EU) market. Despite trade concerns,
million pounds
1,600
1,200
800
400
0
2008/09
2009/10
2010/11
2011/12
2012/13
2013/14
2014/15
2015/16
2016/17
2017/18
2018/19
2019/20e
2020/21e
2021/22e
2022/23e
2023/24e
Average 10th Percentile 25th Percentile 75th Percentile 90th Percentile
* total for all pistachio categories
Source: CPC, ACP, CASS, APG, Rabobank 2019
"The potential negative
effect of China’s tariffs
has been partially offset
by less competition
from Iranian product."
Figure 2. Baseline US Pistachio Production, 2008/09-2024/25e*
pistachio shipments during the 2018/19 marketing year continue
at a strong pace. For several months, the U.S. industry
took advantage of a raw vs. roasted pistachio tariff differential
going into China (45 percent vs. 15 percent) by focusing
on shipping roasted products. However, in the June 2019
retaliatory tariffs, China increased tariffs on U.S. processed
pistachios, eliminating that option to avoid higher tariffs.
The potential negative effect of China’s tariffs has been
partially offset by less competition from Iranian product.
Iran produced about 35 percent of global pistachio production
in 2017/18, but extreme weather conditions severely
impacted the 2018/19 Iranian crop—a 66 percent reduction
year over year. Given the two-year cycle of pistachio (bud)
development, some industry analysts expect the Iranian
crop to still be down during the 2019/20 marketing year.
The U.S. is the leading pistachio-exporting country,
usually accounting for about 60 percent of global exports.
However, given the decline in Iranian exports, U.S. exports
will make up about three-quarters of the world’s pistachio
exports in 2018/19.
U.S. exports to China, fostered by a fast-growing middle-class
population, have grown fourfold over the last
decade—from about 50 million pounds in 2008/09 to
more than 200 million pounds in 2017/18. If tariffs on
2024/25e
12
West Coast Nut September 2019