Pistachios: Bullish Inshell Market Meets Mixed Kernel Outlook

The global pistachio market is entering the 2025/26 crop year with strong export momentum and structurally tight supply, particularly in premium inshell qualities. At the same time, high levels of shelling stock are capping the upside in kernels, creating a clearly segmented market that buyers must navigate carefully.

US shipments are running well above last season’s off-year levels, while total availability remains below the last on-year peak. Geopolitical frictions in the Middle East, reduced Turkish output and constrained Iranian exports are shifting demand structurally toward US and EU-origin product, underpinning firmer inshell prices in EUR terms.

📈 Prices & Shipment Dynamics

According to the February shipment update for the 2025/26 crop year, total US pistachio shipments reached 93.54 million lbs for the month (+33.6% year-on-year), bringing year-to-date volumes (Sep–Feb) to 668.26 million lbs (+25.5% YoY). Despite this strong performance, shipments remain around 6% below the previous structural high on-year 2023, highlighting that the current rally is driven by demand rather than record supply.

The export segment is the clear growth engine: February exports rose 44.0% YoY to 75.90 million lbs, while domestic shipments edged up just 1.8% to 17.64 million lbs. Cumulatively, exports are up 31.8% (543.21 million lbs), whereas US domestic demand at 125.05 million lbs aligns almost exactly with the 2021–2025 average, confirming a stable but not accelerating home market.

🌍 Supply & Demand Balance

Total US receipts for 2025/26 have been modestly revised higher to 1.59 billion lbs from a previous 1.57 billion lbs, a slightly bearish nuance on paper. More critical, however, is the composition: closed shell and shelling stock are expected to reach roughly 300 million lbs, surpassing the historical high of 262 million lbs seen in 2023. This record share of “problematic” material boosts kernel availability but tightens the pool of premium inshell product.

On the demand side, several structural drivers are supporting US and EU-origin pistachios. Turkey is in an off-year with weaker production, while Iran faces ongoing geopolitical and logistics constraints that complicate export flows and EU market access. Recent analysis of the Iran pistachio trade underlines that logistics and sanctions, rather than production alone, are increasingly the bottleneck for getting product to world markets. EU buyers are therefore substituting away from Iran and, to some extent, from Turkey, and turning more to US origin, reinforcing the export-led strength visible in the shipment data.

📊 Price Structure & Segment Divergence

Spot indications for US Extra #1 21/26 inshell pistachios are currently around EUR 4.15–4.25/lb, calculated from USD 4.50–4.60/lb at an EUR/USD rate of roughly 1.145. Kernel prices are quoted at approximately EUR 9.85–10.15/lb, based on USD 10.70–11.00/lb. The structure reflects a firm, upward-trending inshell curve versus a sideways to slightly softer tone in kernels.

In the inshell segment, the combination of strong export pull, constrained premium-quality availability and a market that is already “well sold” creates a clearly bullish environment. Spot volumes are limited, and buyers seeking top grades for the 2025/26 season face rising replacement costs, particularly in Europe where the weaker euro versus the dollar mechanically lifts import prices.

In contrast, kernel prices are facing headwinds from the large shelling stock. Record volumes of closed shell and lower-grade material are being cracked, swelling kernel supply and tempering price gains. This makes quality differentiation crucial: higher-spec kernels with clean Aflatoxin profiles and reliable documentation continue to command a premium, while standard or mixed quality lots see more competitive pricing due to abundant availability.

🌦️ Weather & Regional Outlook

Weather conditions in the main US growing regions (California’s Central Valley) have so far been broadly supportive of orchards, with typical cool and relatively wet winter conditions followed by a gradual warming trend into spring. No major new stress events have been reported that would substantially alter the 1.59 billion lbs receipt figure for the current crop.

In Turkey and parts of the Middle East, ongoing concerns about water scarcity and climatic volatility underpin the structural risk premium in global pistachio prices, particularly in off-years. For the near term (next 1–3 months), weather is not the primary driver; instead, trade flows, logistics and currency moves are more relevant for short-run price formation.

📆 Market Forecast (0–9 Months)

In the short term (0–3 months), the inshell market is expected to remain on an upward trajectory in EUR terms. With export demand leading and spot availability limited, further moderate price appreciation appears likely, especially for EU buyers exposed to both firm dollar-denominated offers and ongoing freight cost pressures linked to Middle East route disruptions.

For kernels, the base case is for stable to slightly weaker prices over the same horizon, as elevated shelling stock continues to feed supply. However, any deterioration in Aflatoxin profiles or logistics disruptions affecting lower-cost origins could tighten the higher-quality kernel segment and stabilize prices faster than expected.

Looking further ahead into the 3–9 month window, the market remains fundamentally constructive. An expected global off-year in 2026 and lingering supply gaps in Turkey and Iran point to a persistently tight global balance, particularly for premium inshell grades. EU demand appears stable to slightly rising, with ongoing substitution away from more complex origins in favor of transparent, compliant suppliers.

🧭 Trading Outlook & Recommendations

• Inshell buyers (roasters, packers, brand owners): Consider advancing coverage for premium inshell requirements, especially for EU destinations. The market is structurally bullish, export-led and well sold; waiting for a correction risks facing higher EUR-based replacement costs.
• Kernel buyers (industry, confectionery, ice cream): Use the current oversupply from shelling stock to secure selectively priced contracts, focusing on suppliers with strong quality control and Aflatoxin management. There is room to negotiate on standard grades, while paying a justified premium for guaranteed specs.
• EU importers & traders: Monitor freight and insurance costs on Middle East routes closely and factor a risk premium into forward positions. Currency hedging is advisable: a weaker euro versus the dollar amplifies any underlying firmness in USD-based offers.

📉 3-Day Regional Price Indication (Directional, EUR)

Market	Product	Indicative Level (EUR/lb)	3-Day Bias
EU (CIF main ports)	US Inshell Extra #1 21/26	4.15 – 4.25	Slightly higher
EU (CIF main ports)	US Kernels, standard	9.85 – 10.15	Sideways / slightly softer
FOB Iran (Tehran)	Inshell Ahmadaghaei 24–26	≈9.50	Stable (logistics-driven risk)