<p></p><p>A recent report indicates strong consumer demand for almonds, suggesting that production of the nut will remain profitable for most California growers, despite a sharp drop in prices since last summer. However, it also highlights looming challenges for nut growers in the southern Central Valley.Rabobank’s assessment says Golden State almond producers are expected to harvest some 2 billion pounds this fall, which roughly equals the record crop of 2011-12.Not coincidentally, that high level of production has come as prices paid to growers have dropped to about $2 per pound, less than half what they were as recently as August, when the industry was still benefiting from past production shortfalls and a strong U.S. dollar.Rabobank’s report says the good news for growers, at least in the long term, is rising demand for the nuts.“More plentiful harvests and, now, lower prices will again encourage more consumption of almonds,” reads the report released late last month. It was authored by Rabobank’s senior fresh produce analyst, Vernon Crowder.Two aspects of the report were less than optimistic for local growers. <br></p> <p>First, it says almond prices probably won’t rise above $2.33 per pound, their average during the last decade, for another two to three years. But once prices reach that point, the report predicts, they won’t drop below it for at least 10 years.Perhaps more importantly to Kern’s farming industry, Rabobank predicts more and more almond orchards in the southern Central Valley will be converted to other crops because of unreliable surface water supplies.Bakersfield-area almond grower Richard Enns agreed the nut remains profitable for many local growers. But he said low prices are tempting owners of older, less productive orchards to consider replanting them with other crops.“It is questionable if they'll go back to almonds, or maybe they'll go to pistachios or table grapes,” he said, adding that almond prices will likely rebound once the global economy fully recovers from the recession.<br></p><p></p>