California’s drought puts a damper on absolutely nuts almond demand

There’s a solid chance you’re snacking on almonds while reading this.

And there’s a great chance those almonds came from drought-prone California, whose $6B almond industry generates 80% of the world’s supply, per The Wall Street Journal.

Outside of almonds, California produces ⅔ of the US’s fruits and nuts and more than ⅓ of its veggies (thanks, Cali).

But the state’s current drought is… less than ideal

For starters, California recently survived a different drought, one town has been delivering bottled water to its 1.2k residents for weeks, and meteorologists predict more to come.

Like we said, less than ideal — especially for an acre of almond trees, which can guzzle up 1.3m gallons of water a year.

In the meantime, almond demand is nuts

US farmers produced a record 3.1B pounds of almonds in 2020.

Some more almond joy:

• Blue Diamond Growers — makers of Almond Breeze — grew sales last year to $1.6B, more than twice the previous decade
• California’s international almond exports were way up in 2020 (Morocco: +148%, Vietnam: +132%, India: +54%)

But the drought is forcing farmers to change plans

Seth Fiack, a rice farmer, decided to stop farming altogether and instead sell his water for $575 per acre-foot, which is “a volume of water one acre in size, one foot deep,” according to the New York Times.

Almond farmers are making changes, too:

• Mark Jansen, who runs Blue Diamond, will likely reduce the company’s international exports
• Stuart Woolf is considering replacing 400 acres of dead almond trees with a solar farm

Oh yeah, that’s another problem: Without water, California’s hydroelectric dams — which generated ~17% of the state’s power in 2019 — are gonna have a tough time charging up.