Almond Market: Renewable Microgrids Tighten Cost Control as Prices Stabilise

Almond kernel prices in EUR are broadly stable, while structural investment in renewable microgrids at major orchards is quietly reducing energy risk and supporting long‑term supply reliability rather than driving short‑term price spikes. Almond producers are entering the 2026/27 marketing year with relatively steady export offers from the US and Spain and a growing focus on cost control at orchard level. A new large‑scale solar and battery microgrid at South Australia’s Koompartu Farms sharply cuts diesel use and stabilises power for irrigation, signalling a shift toward decarbonised, more resilient almond supply. Against this backdrop, the market is watching Californian and Australian crop performance and global demand trends, but current pricing suggests a balanced near‑term outlook rather than pronounced tightness.

Prices

Latest offers (all converted and expressed in EUR) show a flat short‑term picture for key origins. US almond kernels (Carmel, SSR 20/22 and 18/20) are quoted around EUR 6.50–6.55/kg FAS Washington D.C., unchanged between 26 June and 10 July 2026. Organic US Nonpareil 27/30 SSR remains near EUR 9.15/kg FOB, also steady over the same period.

Spanish material is similarly stable: conventional Marcona 12/14 trades near EUR 6.45/kg and 14/16 at about EUR 8.05/kg FOB Madrid, while Valencia types cluster around EUR 6.95–7.30/kg. Guara‑based kernels remain the value segment at roughly EUR 5.40–5.95/kg. The lack of price movement over several weeks underlines a broadly balanced spot market with no immediate supply shock being priced in.

Supply & Demand

Koompartu Farms in South Australia, with more than 2,500 hectares under almonds, has commissioned a large solar‑plus‑battery microgrid designed to supply about 85% of its 6.7 MW electricity demand. The 9.2 MW single‑axis tracking solar array with over 15,600 panels and a 10.2 MWh battery system sharply cuts reliance on 16 diesel generators and roughly 19 km of high‑voltage cabling across the 9,340‑hectare property.

The project targets an 88% reduction in diesel generator use, directly lowering operating costs and emissions for energy‑intensive irrigation and water‑management systems. By enhancing power reliability during critical growth stages, it reduces production risk and underpins consistent yields. Similar earlier microgrids at Cadell Orchards and Canally almond orchard, which each cut diesel use by about 85%, confirm growing adoption of this model in major southern hemisphere almond regions.

Globally, California remains the dominant supplier, and recent industry acreage data point to a modest decline in bearing area after years of expansion, tempering long‑run output potential. At the same time, demand from major importers in Asia, the Middle East and Europe remains solid, but not overheating, matching the current sideways price pattern. Market participants are therefore more focused on cost structures and reliability of supply than on absolute volume constraints at this stage.

Fundamentals & Cost Structure

The Koompartu microgrid is structured under a 20‑year power purchase agreement, with AGL financing, building and operating the assets and selling electricity to the orchard. This model allows farm management to concentrate on agronomy and marketing while locking in predictable long‑term power costs. In an environment of volatile diesel and grid prices, such PPAs effectively hedge a key input cost per kilogram of kernels.

Energy is a major variable cost in almond production because irrigation pumping must operate continuously through the season. By substituting on‑farm solar generation and battery storage for diesel‑based power, orchards gain both cost relief and resilience to fuel supply disruptions. Over time, wider adoption of similar microgrids across Australian and potentially other origins could flatten the almond cost curve, keeping high‑water‑use orchards competitive despite rising environmental and regulatory pressures on fossil fuels.

From a risk perspective, more resilient on‑farm power also lowers the probability of yield losses from irrigation outages during heat events or peak demand periods. That supports more stable export programmes and reduces the volatility premium that buyers might otherwise pay to secure coverage against production shocks in energy‑constrained regions.

Weather & Regional Outlook

In South Australia’s Riverland region, where Koompartu Farms is located, recent seasonal outlooks indicate a tendency toward below‑median rainfall and ongoing climate variability over the coming months. While almonds are irrigated, reduced natural inflows raise the importance of efficient, reliable pumping systems and cost‑effective power. The newly commissioned microgrid therefore directly mitigates one of the key climate‑related operational risks.

Elsewhere, California’s 2026 crop will depend on summer temperatures and water allocations, while Australia is expected to remain a competitive counter‑seasonal supplier. With acreage growth slowing and energy costs better contained through renewables, the medium‑term balance points to moderate production growth rather than aggressive expansion, aligning with current price stability in EUR‑denominated export offers.

Trading Outlook & 3‑Day Price Indication

• Buyers: With EUR‑based offers stable and cost‑reduction investments strengthening supply reliability, consider covering near‑term needs and a portion of Q4 requirements, especially for premium Nonpareil and Marcona grades.
• Sellers/orchards: Use the current price floor and improved cost visibility from microgrids and PPAs to lock in forward sales where margins are acceptable, particularly before any potential weather‑driven volatility later in the season.
• Industry investors: The Koompartu model suggests that capex into renewable energy infrastructure can materially de‑risk almond assets; portfolios exposed to Australian orchards may benefit from similar projects.

Over the next three trading days, US almond kernel offers in EUR are expected to remain broadly unchanged around EUR 6.50–6.60/kg for standard Carmel SSR and near EUR 9.15/kg for organic Nonpareil FOB. Spanish material is likewise seen steady, with Marcona near EUR 6.45–8.70/kg and Valencia types around EUR 7.00–7.30/kg FOB Madrid, reflecting a calm, range‑bound market in the very short term.