If there’s such a thing as a 2023 California “it” crop, pistachio nuts win the prize.
First off, consumer demand for pistachios at home and abroad has never been higher than it is today. Since 99% of all pistachio nuts produced in the U.S. are grown in the Golden State, that’s good news for California agriculture.
Additionally, the food industry – food makers and restaurants – are embracing pistachios in a big way. For example, food makers are developing retail packaged food and drink products to include pistachios at a higher rate than has ever been the case before.
Restaurants are going nuts over pistachios too. Global food industry consulting firm Baum + Whitman recently included pistachio nuts among its top ten food trends for 2023 in its popular annual Trends Report.
The report says pistachios are showing up on more restaurant menus than ever before. According to the report, some of the new uses for pistachio nuts at restaurants include: pistachios replacing pine nuts in pesto dishes, combining pistachio nuts with cheese in tortellini filling, and as an ingredient in inventive Mexican moles. The report also says pistachios are being used for color and creativity as a pizza topping and in pastries for both taste and visual appeal.
Pistachio milk is also growing in popularity as more companies create brands, more retail stores stock it on the shelf, and more consumers try it in search of the next new thing in plant based milk.
Earlier this year Starbucks added pistachio milk based coffee drinks to its menus at thousands of stores. Other cafe chains are doing the same.
Pistachios also have a strong health halo, which is leading to increased sales not only for the snack nuts but for value-added products that include them. The nuts are rich in a variety of nutrients and may support weight loss, gut heath, blood sugar control and heart health.
On the grower side, 2023 is shaping up to be a banner year, according to the presentations and discussions at the recently concluded American Pistachio Growers Association (APGA) conference in Carlsbad, California.
Richard Matoian, president of the Fresno CA based association, said more rainfall this season has eased the multiyear drought, with improved water allocations for farms. The colder winter has also provided adequate chilling hours for pistachio trees to produce flowers and fruit. With more pistachio trees coming online this year, growers appear on pace to produce a record crop that could top 1.2 billion pounds, he announced at the conference.
There was much excitement in many quarters at the conference this year, reflecting the fact that pistachios are having their moment. Sorry almonds.
Matoian summed up the positives, saying that after two years of port congestion that led to delayed and stranded shipments of agricultural exports, those problems have largely been resolved. The quality of U.S. pistachios remains a “major selling point worldwide,” he said, as are the nut’s health benefits. “Pistachio marketers continue to make inroads with consumers, who have become more familiar with the nut,” he added.
From September 2022 to January 2023, overall pistachio shipments jumped 1.9% year over year, Matoian said.
Some of the biggest news at the conference had to do with the growth of pistachio acreage in California and the resultant doubling of production over the next decade.
State acreage increased 20% between 2020 and 2022, from 371,386 to 446,000 acres. While it took 40 years for production to reach 1 billion pounds, Matoian said he expects it will grow to a whopping 2 billion pounds in the next 10 years. If current consumer demand level growth continues, there will be a market for the 2 billion pounds, in my analysis. The industry will need to play a major role in helping to sustain and drive consumer demand though.
The growth in pistachio production, processing and sales is also having a huge positive economic impact on California, according to a new economic study released at this year’s conference.
The study by Dennis H. Tootelian of the Tootelian Company in Sacramento CA, found that with every new acre of pistachios added, California reaps a wellspring of economic rewards totaling more than $6.4 billion in the Golden State.
Tootelian’s number-crunching reveals that the economic impact of California pistachio grower and processor spending on farming operations totaled nearly $3.5 billion annually, or the equivalent of more than $9.5 million per day in 2022. Total economic output was calculated by Tootelian at more than $6.4 billion, an average of more than $17.6 million every day, impacting an array of sectors from real estate, professional services, construction, insurance and retailing.
Spending by California’s pistachio industry helped create 55,100 jobs on a full-time equivalent basis in 2022. Grower spending generated more than 27,000 jobs and processor spending generated more than 28,000 jobs, according to the report.
The study also found that labor income generated by California pistachio growers and processors was nearly $3 billion in 2022.
Tootelian wrote that the labor income helped boost other sectors of the economy. Possible purchases with this labor income would equate to $770 million for housing, $373 million for transportation, $282 million for food, or $185 million for healthcare, and even $82 million in charitable cash donations, according to his analysis.
“The money spent by growers and processors spreads throughout the economy, creating business activity down the main streets of towns and cities across the state,” Tootelian said. “The green kernels shaken from California pistachio trees each year produce another kind of green for our economy – thousands of jobs and millions of dollars in business taxes.”
The report calculated the total indirect business taxes generated as a result of grower and processor spending at more than $230.9 million in 2022, or the equivalent of $632,600 per day. The impact of the industry’s spending generated $98.8 million in sales taxes and $81.3 million in property taxes in 2022, according to the data.
A key driver of this economic boom created by California’s pistachio industry is the surge in bearing acreage from 371,386 acres in 2020 to 446,000 in 2022.
“Just the increase in bearing acres of 74,614 acres created additional grower and processor spending of more than $513.8 million on these bearing acres, averaging more than $2.7 million per day,” Tootelian says in the report.
“With every economic study of the industry, the numbers keep getting more and more impressive,” Tootelian said.
“Every new pistachio seedling planted in our state’s soil turns the key of a powerful economic engine that benefits all Californians, no matter where they live.”
The growing popularity of pistachios domestically and globally is good news for California and for California agriculture. The state produces 99% of all the pistachios grown in the U.S., with Arozina and New Mexico producing most of the remaining 1%. In other words, as California goes, so goes pistachio nut production in the U.S.
Pistachio prices also are holding up far better for growers than is the case with almonds and walnuts, the other two major nut crops in California. This fact helps explain the explosive growth in new pistachio acreage we’re seeing.
California is the largest producer of pistachio nuts in the world and is a major exporter. In fact, about 70% of all the pistachios grown in California are exported.
Global demand for the nuts continues to grow too. Overall global consumption of U.S.-grown (which means California-grown) pistachios is not only increasing but consumers are also broadening their consumption time-frame, according to market research data. For example, traditionally the winter months and holidays have been the main time period when pistachio nuts are consumed. However, consumers throughout the world are eating pistachios in greater quantities in the spring and summer months, which is a major contributing factor when it comes to the increases in overall consumption of the nuts. The major contributor to this change is the increased awareness of the health benefits of eating pistachios.
The outlook for pistachios in California is bright. Demand continues to increase at home and globally. California pistachios are prized for their quality throughout the world, which means many global consumers will pay a premium for them compared to pistachio nuts grown in Iran and Turkey, which are two other major producers.
Additionally, food makers are creating numerous new products using pistachios, mirroring in many ways what they’ve been doing with almonds over the last few decades. Restaurants too are “discovering” pistachios and including them in new dishes appearing on menus at a fast-growing pace. The outlook is bright for California pistachios.
My Job Depends on Ag Magazine columnist and contributing editor Victor Martino is an agrifood industry consultant, entrepreneur and writer. One of his passions and current projects is working with farmers who want to develop their own branded food products. You can contact him at: victormartino415@gmail.com.
