Almond prices reflecting California drought and demand for healthful food

With California’s record-breaking drought stealing the headlines its not hard to surmise why retail prices for one of the Golden State’s largest crops, almonds, are soaring.

But the head of the Almond Board of California says the higher prices consumers are seeing on Pacific Northwest grocery shelves aren’t the result of the water shortage alone.

In many Pacific Northwest stores, raw almonds are selling for more than $12 a pound. That’s more than a 50 percent increase from what almonds were selling for on retail shelves last year.

Richard Waycott, chief executive officer of the Almond Board of California, said a less-than-forecast harvest last year coupled with a robust demand for the healthful nuts have nudged prices higher.

Last fall’s crop was down 12 percent due in part to poor pollination conditions and, in some instances, drought conditions.

A major Tacoma candy maker, Brown & Haley, whose principal product is Almond Roca, is acutely aware of the price pressures on almonds.

“The prices have doubled in the last couple of years,” said Pierson Clair III, Brown & Haley chief executive officer.

Brown & Haley buys “millions of pounds” of almonds every year in truckload quantities, said Clair.

In recent years in part to broaden its product line, but also to reduce its dependency on almonds, the company has developed and marketed other roca products including Mocha Roca, Cashew Roca and Dark Chocolate Roca. Even so, Almond Roca is about 80 percent of the company’s roca sales.

Waycott said demand for almonds in the meantime is growing worldwide. California produces about 80 percent of the world’s almond supply with lesser amounts coming from Australia and Europe. More than a million acres of California farmland is planted in almonds, making it the most widely planted crop in a state noted for its fruit, nut and vegetable production.

Clair said that in addition to the shortage of water, the price of almonds is being driven upward by foreign demand, especially from China. The Chinese have bought as much as 300 million pounds of almonds yearly from California growers.

“The Chinese are very health conscious,” said Clair. “They have created a great demand for almonds and almond products.”

As a healthful source of protein, almonds have won new popularity that has pumped up prices. Some 15 years ago, the wholesale price of almonds hovered near $1 a pound. Now the price has increased to more than $4 a pound.

The California drought, said Waycott, has an uneven effect on almond growers. In some areas where water is scarce, the drought has been devastating. In others where water is more available and almond growers have invested in water-saving irrigation equipment, the trees are surviving and producing. More than 70 percent of almond growers have converted to water-efficient systems, said Waycott.

This story was originally published May 1, 2015 at 9:00 AM with the headline "Almond prices reflecting California drought and demand for healthful food."