What is the Section 32 Buy program?
The USDA is authorized to purchase agricultural commodities and divert them towards domestic nutritional assistance programs (School Lunch Program, food banks, soup kitchens). This helps remove surplus product from the market and stabilize commodity prices.
Overview
The California walnut industry represents over 4,500 walnut growers and 95 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 4th 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 walnut prices, particularly when trade barriers in the form of tariffs are accounted for in several important markets, and trade disruption is present due to the ongoing COVID-19 pandemic.
CWC Action
The CWC has lobbied on behalf of the walnut industry over the past few years for USDA to purchase walnuts and provide price relief to industry. For the record-breaking 2020/21 crop, the CWC successfully procured a 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 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 on the market by removing excess inventory and helping stabilize the market prices.
The California Walnut Board does not imply endorsement of this content.
