Almonds Are Cheap Again. How Did We Get Here?

Almonds aren't what they used to be—at least when it comes to cost. Selling for $4.70 a pound wholesale in August 2015, almonds are now down to $2.60. Retail prices for the rest of us should follow suit.

Mother Jones food writer Tom Philpott explains the full story in an article published today, and he naturally couldn't leave the hipsters out of it. Stowing stashes of almonds at their desks and sipping almond milk lattes on the regular, the youngs clearly love their delicate tree nuts.

Philpott called out the hipster demand a couple years back in a series of articles surrounding the water-intensive crop and how detrimental production was in light of California's drought. The Golden State produces 99 percent of the country's almonds and 80 percent of the world's supply. "Lay off the almond milk, you ignorant hipsters," Philpott wrote in 2014, sparking a mild outrage and backlash.

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Hipsters aren't exclusively to blame, however. The international demand for almonds grew in recent years and spurred major development of the crop across California.

While groves expanded, the California drought caused supply to dwindle and prices to rise to more than $4 a pound. When the U.S. dollar rose against Asian and European currencies, almond exports became even more expensive. China, which was once the world's biggest importer of almonds, faced its own failing economy, and all of a sudden expensive almonds weren't so attractive anymore. Ultimately, international demand for almonds plummeted in response to high prices, the Financial Times reported last week.

This year, however, thanks to El Niño, almond yields are expected to be much better than years past. A more robust supply coupled with a weak international demand explains the current price drop. Good news for the hipsters, if they still think almonds are cool anyway.

This could be good news for farmers, too, Philpott explains. Even when almond prices rise in response to severe drought, almond farmers still only break even on their crops. More rain this year could make water cheaper and the crop profitable again, even with the lower almond prices, Philpott claims.

Though it sounds like a win-win scenario for both trendy urbanites and farmers, the future might not look so sunny. Philpott warns that if international demand increases again, as University of California Cooperative Extension orchard adviser David Doll surmises it will, trouble might return.

Almonds will always demand a lot of water. In 2014, they accounted for 10 percent of California's water supply. That year, the state passed the landmark Sustainable Groundwater Management Act, which, by 2025, will require aquifers to not be depleted faster than they are filled. Doll isn't so sure almond farmers are planning for this requirement, however. Of course 2025 seems like a far way off. In the meantime, Philpott concludes, "Enjoy those relatively inexpensive almonds, you ignorant hipsters."