Higher U.S. walnut inventories partly brought on by sluggish purchases from China over recent months mean the Chilean walnut industry could be facing some bigger challenges than normal this campaign. 

But an industry head is optimistic for the sector's recent development and potential new market openings mean a bright future is still in store.

Grower body Chilenut president Juan Luis Vial was speaking about the current campaign at the recent EXPONUT event in the capital Santiago.

The event is the largest meeting point in the Chilean walnut sector, and brought together more than 450 growers, exhibitors, suppliers, investors, and entrepreneurs, from South America, Europe, and other parts of the globe.

"We currently have a slightly less optimistic projection for the season than we had hoped," Vial said.

"Large increases in Californian production, which grew some 40-50% compared to last year, combined with lower purchases from China over the last few months have created an enormous  inventory to sell in the U.S. which joins our marketing season.

"Chile also has larger volumes than last year - about 25% higher."

In addition to this is the rapid strengthening of the U.S. dollar against the euro - which is the official currency in Chile's main markets.

"The price of our products has gone up dramatically in these countries, and so importers and supermarkets are anticipating a lower consumption and a halt in the growth experienced over the last few years," Vial said.

However, the Chilenut head added the same circumstances would make higher returns in Chilean pesos to local growers and exporters, somewhat helping to offset the other issues.

Vial also said he was hopeful for the industry's medium and long-term future as growth was expected from some of Chile's markets were the tree nut was currently sold.

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