Why are nut prices increasing?

Why are nut prices increasing so much?

February 11, 2011

Nut prices are a great example to demonstrate the laws of supply and demand. Domestically we grow almonds, filberts, peanuts, pecans, pistachios, sunflower seeds and walnuts. We import most dried fruit, cashews, brazil nuts, pine nuts, and pepitas. Science continues to provide evidence that nuts are good for you to eat every day. Establishing this habit around the world (in and of itself) means more people are buying nuts and this helps to make prices rise.

Many of the nuts are grown on trees, in orchards. They take 3-7 years before they begin producing nuts and require certain type of climate conditions for them to grow and produce successfully. Because of this they only can grow in certain regions around the globe and supply is relatively fixed.

Over the past couple of years, China and India have played a much larger role in purchasing nuts from this country as well as in consuming more nuts within their own countries. They have bought a large percentage of in shell walnuts and pecans from this country this crop year.

Our devalued dollar makes goods more expensive for us to buy. That is partly why things like cashews have gone up in price. India shipped most of its cashews into export but now that its economy is growing they now consume most of what they grow within their country thereby reducing supply to other countries resulting in higher prices.

Weather always plays a role in the supply of agricultural commodities. Nuts are no different. Because nuts are bought by more and more people around the world, one year of bad weather and poor harvest in a growing area (somewhere in the world) reduces supply and prices go up.


Cotton, believe it or not, is also affecting peanut prices. China has been buying a huge percentage of the cotton we grow. Because of this cotton prices have jumped. Since cotton can be grown on soil that is used to grow peanuts (both need to be planted each year) if a farmer has to decide what to plant he will plant the crop that gives him the most money. Since cotton has gone up in price, peanuts are going up in price so that there is an incentive to plant peanuts instead of cotton.

Isn't it amazing how intertwined the world is and how nut commodity pricing is affected by so many factors. We wanted you to know that it really isn't us but rather it is events outside of our control that forces us to continue to raise our prices.


We hope you have enjoyed this "behind the scenes" look at what effects nut prices. Thanks for sharing your time with us. We look forward to continuing to serve you throughout the year.


Have a great day!



George Argires (anuts.com)