Supply Chain Issues Creating Cash Flow Problems for Almond Producers

Jim Rogers Almonds, Nuts & Grapes

Almond producers are looking at further complications related to supply chain congestion. President and CEO of the Almond Alliance of California, Aubrey Bettencourt explained that now cash flow issues are starting to become apparent. While foreign demand has remained strong, much of the 2021 crop is still sitting in storage in the U.S. already sold. However, the problems arise as payments will not be received until the product is delivered.

“The 2021 crop we now know has not shipped to the level that we thought. The cash flow was not received by our handlers, processors, hullers, and shellers, so they have little to no leeway to afford the pool payments to our farmers for the 2022 year,” said Bettencourt. “This is getting to be a scary situation. I’m not speaking for everybody, but it is a concern, and we are starting to see letters about it that we just don’t have the cash flow available to our farmers.”

almond producers

The hullers, shellers, processors, and handlers need those payments for product in order to finance pool payments. Last year, pool payments were paid for the 2021 crop, providing almond producers with the operating capital requirement to continue farming. This year could be a more troubling situation unless shipments of almonds pick up pace and payment is received. Farmers rely on those pool payments as lifeline for keeping their operations running.

“Land payments still exist. It’s going to be a drought year; water is going to be expensive. We’re putting bees out right now and we need to have cash to be able to do that. And we’re looking at all the other inputs because we know our job as a farmer is to keep that tree alive and producing. There are cash inputs that are required to do that. So, this is a serious concern,” Bettencourt explained. “This is why this is the year that this is going to come home to us on the ground and to our farmers on the ground and that’s the message to anybody who will listen.”

About the Author

Brian German

Facebook Twitter

Ag News Director, AgNet West