Why Are Pistachios so Expensive?

pistachios-expensive Credit: mjtmail (tiggy)/CC-BY 2.0

The seasonal nature of the pistachio harvest, low rainfall and pest infestation all account for the rising prices of pistachios. In addition to these natural variables, pistachio distributors have incorporated the laws of supply and demand when selling the popular tree nut. They hold product from the public on heavy harvest years to drive higher prices and force scarcity.

Pistachio hoarding, or stocking, directly affects the world price of pistachio nuts in that it drives them higher than what is necessary. In high harvest years, pistachio distributors, the middlemen between the farmer and buyer, hold surplus nuts and store them for the next year in case there is a shortage. This creates a smaller available supply and creates higher prices passed down to the consumer. Pistachio hoarding is a risky practice for the distributor. It requires a large warehouse to properly store the nuts from weather and pests. If not stored properly, the surplus pistachio crop could possibly be unusable for future years and cause a shortage with no profit. Because of the combination of this questionable practice with inconsistent harvest years due to changing weather patterns and blights from new pests, the price of pistachios is likely to remain steadily high for years to come.