Pistachio market pressure: overview
- Pistachio supply faces pressure from demand growth, weather and geopolitics
- Dubai chocolate trend has significantly increased global pistachio demand volumes
- Iran conflict disrupts exports, slowing logistics but not severely cutting supply
- Major producers including US, Turkey and Iran report lower than expected harvests
- Market outlook signals tight supply conditions with shortages and cautious trading
Pistachio is having a moment. Last year, the green nut saw an explosion of prominence with the popularity of Dubai chocolate. Now, it has emerged from the shadow of that viral bar and made it into a wide range of confectionery.
The nut is seeing pressure from two directions. On the one side, there is high demand from the popularity of Dubai chocolate and other products. On the other, exports from Iran, a major producer of the nut, have been disrupted by the conflict there.
Yet these factors do not make up the whole picture – they only add to existing pressure on pistachios.
Is there a shortage of pistachios?
There is clearly a strain being exerted on pistachio supply, but does this mean that there’s a shortage?
“I’d hesitate to call it a definitive shortage,” says Nick Moss, nut market reporter at commodities analytics company Expana. “Industry contacts I speak with describe it more as a tight or cautious supply situation.”
The three major producers of the nut – Turkey, the US and Iran – have all experienced harvests that have come in below expectations this past year, although the US still had a bumper crop.
While a shortage may appear down the tracks, so far the situation hasn’t reached that point.
Dubai demand is still present
Even last year, farmers were beginning to see shortages of pistachio due to the propulsive popularity of Dubai chocolate, which saw viral fame on social media platforms such as TikTok. Commodity prices for pistachios jumped by a third due to this demand.
Now, demand has spread beyond the crispy treat to other pistachio-themed confectionery.
Demand has “been really strong in recent years, and Dubai chocolate plus other product innovations and marketing efforts have played a big role in driving that growth“, explains Expana’s Moss.
Iran war puts pressure on pistachios
Meanwhile, the war in Iran is adding to logistical difficulties, but it isn’t the whole story.
Iran is the world’s second-largest producer of pistachios, following the US. Now that the country has become engulfed in military conflict, how much pressure is this putting on pistachios? Moss admits that the situation is “a bit complicated”.
Iran, he points out, was “already dealing with trade limitations, domestic issues and communication problems well before the military conflict ramped up at the end of February”.
In light of this, the war has only added to logistics challenges, rather than affecting physical supply, according to Moss’s industry contacts. Pistachio is still moving through overland routes, just more slowly and in smaller volumes.
There are predictions of a production pullback in the country, but this is being linked more to weather challenges and production issues than the war.
The future of pistachios
The future of pistachios may not be entirely bright.
“People are getting nervous looking ahead,” says Expana’s Moss. The US and Iran are predicted to see much smaller crops for the 2026-27 season. The industry is starting to prep for a potential shortage.
“Many US sellers are being cautious anyway since pistachios are cyclical and they’ve been expecting an ‘off-year,’” he says, “but market players are reporting that liquidity has been very thin since crop estimates started coming out.”
Weather is a long-term challenge, with drought conditions being factored into crop outlook. Weather is not just a factor in Iran: extreme heat in the US is affected the size and quality of pistachios, according to growers.
Reduced yields of pistachios have been linked to the effects of climate change.
Overall, while pistachios are under pressure, the war in Iran and Dubai chocolate-related demand are far from the only things exerting it.
