In a sprawling plant in the heart of California’s farmland, millions of pistachios rush down metallic chutes, onto conveyor belts, and through rigorous inspection and packaging. These vibrant green nuts will soon be shipped worldwide, destined to grace grocery store shelves and become a staple snack for consumers from California to China.
California, the nation’s agricultural powerhouse, has seen a surge in pistachio farming in recent years. The reasons are as pragmatic as they are economic: pistachios are a hardy, drought-resistant crop capable of thriving in the state’s arid climate, providing a lucrative alternative for farmers whose land has been traditionally used for other water-intensive crops. In 2022 alone, California’s pistachio industry generated close to $3 billion, outpacing Iran as the world’s top pistachio producer and exporter.
But while pistachios have gained ground as a viable crop in California’s Central Valley, the industry is learning from the pitfalls faced by almond growers—an even larger nut industry in the state that has grappled with water scarcity, rising costs, and market fluctuations in recent years. With demand for pistachios continuing to grow both domestically and abroad, California’s pistachio farmers face both challenges and opportunities as they seek to balance sustainability and expansion.
California’s Central Valley is an agricultural juggernaut, producing over a third of the country’s vegetables and around three-quarters of its fruits and nuts. Over the past decade, pistachios have gained prominence, moving from a relatively niche crop to California’s sixth-largest agricultural commodity by value, surpassing well-known products such as strawberries and tomatoes.
“There has been an explosion over the last 10 or 15 years of plantings, and those trees are coming online,” said Zachary Fraser, president and CEO of American Pistachio Growers, an organization representing over 800 farmers across the southwestern United States. “You are starting to see the fruit of people’s vision from 40 years ago.”
Much of this growth is fueled by strong international demand. China, in particular, has become a significant market, where pistachios are considered a premium snack and are especially popular during Lunar New Year celebrations. As demand grows in the United States and abroad, the versatility of pistachios—offered both in-shell and shelled, and in flavors ranging from salt and pepper to honey roasted—has solidified their position as a mainstay snack in grocery aisles.
The Wonderful Company, a giant in California’s agriculture sector known for brands like Halo mandarins and FIJI Water, has been a driving force behind the pistachio boom. Wonderful Orchards, a subsidiary of the company, has been growing pistachios since the 1980s. However, in 2015, the company ramped up its investment in pistachios after developing a specialized rootstock that produces up to 40% more nuts using the same amount of water and soil.
Rob Yraceburu, president of Wonderful Orchards, emphasized that the company’s commitment to pistachios has been instrumental in meeting increasing global demand. “There is an increasingly growing demand in pistachios,” Yraceburu said. “The world wants more.”
Today, Wonderful Orchards produces between 15% and 20% of the U.S. pistachio crop. Their extensive orchards, located on arid lands northwest of Los Angeles, are a testament to the resilience of pistachio trees and their compatibility with California’s hot, dry climate.
California’s agricultural industry faces significant environmental challenges, most notably a scarcity of water. While almonds remain the largest nut crop by value in the state, pistachios are rapidly closing in on that top spot, largely due to their ability to withstand drought conditions better than other crops.
Pistachio trees require approximately three acre-feet (around 3,700 cubic meters) of water per acre, while almonds need nearly four acre-feet (approximately 4,934 cubic meters) to produce similar yields. In times of drought, pistachio orchards can survive on reduced water, something almond trees struggle with. Additionally, pistachios are wind-pollinated rather than bee-pollinated, reducing the need for a robust bee population to support crop production, a significant advantage given recent concerns over bee populations.
“Pistachios produce more per acre than almonds, require less water, and fetch a higher price,” said David Magaña, a senior analyst at Rabobank in Fresno, California. “The value that the pistachio industry provides to California agriculture is approaching that of almonds with much less acreage.”
While pistachio farming is on the rise, the lessons learned from almond farming have influenced pistachio growers’ strategies. Almond production skyrocketed in California in recent decades but reached a tipping point as post-pandemic supply gluts, coupled with escalating input costs, drove prices down. Many almond growers chose not to replant aging orchards, marking a shift in the crop’s growth.
Yraceburu and other industry leaders are keen to avoid a similar fate for pistachios. As such, they are working proactively to maintain a steady balance between supply and demand. American Pistachio Growers, for example, has recently invested in international marketing initiatives, including a high-profile endorsement deal with a top cricket player in India, aimed at introducing pistachios to new markets and maintaining robust demand.
The growth of California’s pistachio industry is part of a broader trend of farmers shifting from traditional annual crops, like cotton, to perennial crops, which offer higher economic returns. This shift, however, brings unique challenges, as perennial crops cannot simply be switched out when drought conditions worsen. Pistachio trees, unlike many other perennial crops, can survive in saline soils and withstand longer periods without water, making them a particularly attractive choice in a state that struggles with water scarcity.
According to a 2023 report by the Public Policy Institute of California (PPIC), farmers are increasingly opting for high-value perennial crops as they respond to global market demands and environmental pressures. Brad Franklin, a research fellow at PPIC’s Water Policy Center, noted that for California farmers, “the market is the biggest factor, and water is right below that.”
As California grapples with water scarcity, the state’s 2014 Sustainable Groundwater Management Act (SGMA) has added another layer of complexity to the agricultural landscape. This law, aimed at promoting sustainable groundwater use, restricts the amount of groundwater that can be extracted in areas where water basins have been over-pumped. These regulations are expected to impact around one-fifth of California’s pistachio crop, particularly in areas that rely exclusively on groundwater for irrigation.
While some pistachio orchards in affected areas may eventually go out of production, the overall acreage of pistachios in California is expected to continue growing as trees planted in recent years begin to reach maturity. This stands in contrast to almonds and walnuts, whose acreages have stabilized or even declined as some orchards have been removed.
Yraceburu, reflecting on the industry’s future, acknowledged the ongoing challenges. “Some orchards will face tough choices under the SGMA regulations,” he said, “but the growth potential for pistachios remains strong, especially as trees planted in recent years start yielding higher volumes.”
The rise of pistachios in California is a complex tale of adaptation, opportunity, and resilience. For California farmers, the allure of pistachios lies in their relative drought tolerance, resilience in saline soils, and ability to fetch premium prices in international markets. This growth trajectory, however, brings with it the need for careful planning and a keen awareness of the lessons learned from the state’s almond boom and bust cycle.
To support continued growth, pistachio industry leaders are pushing forward with innovative approaches to marketing, sustainability, and water management. Initiatives like the recent endorsement deals in India exemplify efforts to diversify demand and secure a place for California pistachios in emerging markets.
Despite the optimism, challenges remain. As California implements its groundwater management laws, pistachio growers will face increased pressure to find sustainable water solutions. With the industry’s future reliant on a stable water supply, many are exploring innovative irrigation techniques, soil management strategies, and, potentially, new areas for planting outside of high-restriction zones.
