January/February 2025
State of the walnut industry: Navigating challenges and seizing oppportunities
The California walnut industry has faced its share of challenges in recent years, but the 2023-24 crop year marked a shift in a positive direction. Walnut trees have recovered from the drought, with winter rains improving overall health of orchards and providing sufficient water for irrigation, thus enabling the industry to produce high-quality crops. Prices are rebounding from the 2023 crop, and the season ended much stronger than where it started.
Record shipments and market recovery
In 2024, the industry achieved record shipments in terms of volume, with a notable improvement in domestic shipments, which is crucial given the untapped potential of the U.S. market. Export markets have also rebounded strongly from the previous year’s setbacks, with key markets such as India, Turkey, Germany, and Spain showing impressive recovery.
India tariff removal boosts exports
One of the most significant developments has been the lifting of the 20% retaliatory tariff in India, which has led to a staggering 148% increase in volume shipped. This change underscores the importance of ongoing efforts to address tariffs and duties that impact the industry. In 2023-24, California walnut exports to India alone surged, contributing to the overall export growth.
Smaller crop amid growing demand
The 2024 crop has presented a mixed bag. The harvest this year was smooth and efficient, yielding high-quality walnuts that will meet the expectations of consumers globally. However, the crop is smaller than expected, with estimates of walnut production being around 600,000 tons. This reduction is primarily attributed to a lighter nut set due to irregular winter and spring temperatures. The total marketable crop for 2024-25 is expected to be around 700,000 tons, factoring in a lower beginning inventory.
Despite these challenges, the demand forecast for 2024-25 remains strong. Global consumption of walnuts has been on the rise, and the lighter crops in the U.S. and Chile have created a supply-driven market where buyers are willing to pay higher prices. This trend is expected to stabilize or even increase prices, providing a much-needed boost to growers’ returns.
Aligning strategy with industry projections
Looking ahead, future projections for the walnut market are promising. The global demand for walnuts is expected to continue growing, driven by increasing consumer awareness of walnuts’ health benefits and versatility. The California walnut industry is poised to capitalize on this trend through several strategic initiatives:
- Expansion into new markets — With the support of programs like the USDA’s Regional Agricultural Promotion Program (RAPP) and the Market Access Program (MAP), the industry will continue to explore and develop high-potential global markets.
- Innovation in products and packaging — Investments in new product development and consumer-oriented packaging will help meet the evolving preferences of consumers, making walnuts more accessible and appealing.
- Enhanced marketing and promotion — Ongoing efforts to promote the health benefits and culinary versatility of walnuts will drive consumer demand. This includes targeted marketing campaigns, collaborations with chefs and food influencers, and increased visibility in retail and food service channels.
- Sustainable practices — Emphasizing sustainable farming practices and environmental stewardship will not only improve the industry’s resilience but also appeal to environmentally conscious consumers.
- Continued investment in health and nutrition research — The California walnut industry has also been a leader in health and nutrition research, supporting more than 200 peer-reviewed studies that highlight the health benefits of walnut consumption.
In crop year 2023-2024, the California walnut industry had ongoing projects and papers published, with focuses on brain health, bone health, gut health, and nutrient and bioactive health. This research continues to play a crucial role in promoting walnuts as a nutritious and versatile food choice.
Poised for the future
While the California walnut industry may face ongoing challenges, there is a sense of optimism and resilience. With strategic investments in market development, consumer engagement, and research, the industry is well-positioned to navigate the current landscape and seize new opportunities. As we look to the future, the focus remains on providing high-quality walnuts to consumers worldwide, ensuring the industry’s growth and sustainability.
The California Walnut Board (CWB) and California Walnut Commission (CWC) represent more than 4,600 California walnut growers and approximately 70 handlers, grown by multi-generation family farmers. California walnuts are shipped around the world all year long, with more than 99% of the walnuts grown in the U.S. being from California. The CWB promotes the usage of walnuts in the U.S. through publicity and educational programs, and provides funding for walnut production, food safety, and post-harvest research. The CWC is involved in health research with walnuts as well as domestic and export market development activities. To learn more, visit walnuts.org.
