What is the Section 32 Buy program?
Broadly speaking, USDA is authorized to purchase agricultural commodities and divert them toward domestic nutritional assistance programs (School Lunch Program, food banks, soup kitchens, etc.). This helps remove surplus products from the market and helps stabilize commodity prices.
Overview
The California walnut industry represents over 4,500 walnut growers and 86 handlers who process and ship walnuts to customers around the world. California accounts for 99% of U.S. production of walnuts, and walnuts are the leading agricultural export from the state. In just over a decade, the industry has seen production double to reach 650,730 short tons in 2019-20. Crop estimates for the current 2020-21 crop are 19% higher, reaching a record-setting 780,000 short tons. These production gains are attributed to increases in bearing acreage (380,000 acres), higher yielding varieties and orchard management practices that are increasing yields per acre.
As walnut production in California and around the world has increased manyfold over the past few years, it has created a downward pressure on the market, particularly when accounting for trade barriers in the form of tariffs in several of our important markets, and trade disruption due to the ongoing COVID-19 pandemic.
CWC Action
The CWC has advocated on behalf of the walnut industry over the past few years for USDA to purchase walnuts and provide relief to industry. In the pandemic-hit 2020, we had a record-breaking 2020-21 crop, and the CWC successfully procured a COVID relief USDA purchase of $20 million in fall 2020. The CWC has continued to work behind the scenes to pursue the USDA for additional walnut purchase, citing the ongoing trade disruptions and increased worldwide production. The efforts paid off with an additional walnut purchase by USDA in January 2021 for various nutritional assistance programs to the tune of $20 million. This will further alleviate the pressure and stabilize the market by removing excess inventory.
