Rabobank 5-year outlook report: California almonds poised for strong rebound, with high prices and record exports on the horizon

After years of navigating a turbulent economic landscape, the California almond industry is entering a new era of optimism.

According to a comprehensive five-year outlook released by RaboResearch, almond prices are positioned for a significant recovery, driven by tightening supplies and a robust rebound in global demand.

The report suggests that while the road ahead will not be a "straight line up," the industry is moving past the supply-demand imbalances that have depressed the market since 2020. 

The primary takeaway is clear: as bearing acreage progressively declines due to an aging tree population, decreasing supplies will meet a stabilizing demand. This will hold prices steady for a couple of years, but smaller crops will then push grower prices to their highest levels in a decade.

The great yield recovery: Efficiency meets aging orchards

RaboResearch forecasts a projected improvement in crop yields over the next several years. 

From 2022 through 2025, California almond yields averaged 1,900 pounds per acre, a sharp drop from the 2,199-pound average seen between 2012 and 2021. Rabobank attributes this recent slump to a "perfect storm" of less-than-ideal weather, increased pest pressure, and poor economics that forced growers to cut back on orchard management and inputs.

However, the tide is turning. 

"The strengthening in prices over the past 18 months has led to increasing grower optimism, which should lead to an increase in crop input spend and management intensity," Rabobank noted.

With trees today agronomically capable of producing significantly more, the report projects a 75 percent chance that average yields will remain at or above 2,000 pounds per acre through 2029.

Despite these gains, a major challenge is looming right around the corner: the "aging-out" of the California almond orchard. Trees planted during the heavy expansion period between 2004 and 2006 are reaching the end of their 23-year productive life.

Consequently, even as remaining acres become more productive, the total volume will be limited by massive removals. Given this scenario, Rabobank expects bearing acreage to decline by as much as 100,000 acres by 2029, effectively putting a ceiling on total production.

Domestic market: Navigating inflation and the "pistachio factor"

In the United States, the California almond industry faces a complex domestic landscape. 

Currently, domestic shipments are on track to hit their lowest level in a decade, hindered by "sticky" inflation and cooling consumer confidence. For the 2025/26 marketing year, shipments are down 21 percent through October, though they are expected to recover slightly to finish the year down 10 percent.

A notable headwind for California almonds at home is the "ongoing market penetration of flavored and non-flavored shelled pistachios," which have become a formidable competitor in the tree nut snacking space.

However, Rabobank remains optimistic about a domestic recovery starting in 2026. As the Federal Reserve cuts interest rates and consumer confidence improves, almond purchases are expected to climb. By the 2029/30 season, domestic shipments are forecast to reach 738 million pounds. 

Crucially, this volume will be moved at much higher prices—Rabobank projects a 25 percent chance that average prices will exceed $3.50 per pound by the end of the decade.

Export expansion: Records and "Trump-style" diplomacy

While the domestic market stabilizes, the international stage is where the California almond industry expects to set new records. Export shipments are forecast to grow between six and eight percent over the next three years, potentially peaking at 2.08 billion pounds by 2028/29.

Traditional markets such as Europe have shifted to a "hand-to-mouth" purchasing strategy, while Rabobank labels others, like India and the Middle East, as under-bought, presenting a growth opportunity ripe for the taking. Perhaps most surprising is the California almond industry's adaptation to geopolitical uncertainty. 

"The world is seemingly adapting to 'Trump-style' foreign policy," the Dutch bank observed, noting that trade relations currently seem to be trending positive despite earlier stresses.

The report highlights a potential "thaw" in US-China relations as a wild card that could further boost demand, even as China continues to source heavily from Australia. Ultimately, the report concludes that while the era of rapid, explosive growth may be over, the industry has successfully transitioned to a larger, more stable global base. 

For the 7,600 California almond growers, the message is one of hard-earned resilience: market improvement is finally here.

*All images are referential

Related stories

Why the Almond Board of California dropped the USDA’s decades-old Objective Measurement Report

Edeka's bet on Iberian supply: Why California almond producers remain unfazed in the European market