Skip to main content

- Advertisement -

Avocado market strengthens seasonally as Mexico’s volume falls

By
Tim Linden

With Mexico’s avocado volume declining as it nears the end of its 2020/21 season, the avocado market has strengthened as much as $10 per carton since July 1 with the most favored conventional fruit again selling for $40 per carton or more.

“The market is good; it has finally turned around,” said Rob Wedin, executive vice president of sales for Calavo Growers Inc., based in Santa Paula, CA.

He said a significant portion of the May/June time frame saw lower markets than many growers on both sides of the border were expecting. “We were forecasting that July and August would be more favorable and that does seem to be the case.”

Speaking of the company’s California production, Wedin said: “We are behind a bit, but that’s because we want to be,” he said. “When you have a small crop, like California does, you have to be opportunistic. We are now encouraging our growers to pick.”

Calavo expects to market about 20 percent of its total California volume in July, another 15 percent in August and its final 5 percent in September.

Wedin said the lower June market was driven by too many No. 2s out of Mexico as well as a size profile that skewed toward fruit larger than the market wants. Generally, 48s get top dollar with 40s and 60s also doing very well. Extra-large and extra-small fruit return less and if there is too many of those sizes, they tend to drag down the market.

Wedin said that with California in the back half of its season and Mexico in that period with lower volume, the market should maintain a solid price level for the next couple of months.

Mexico, with its dominant volume position, is generally the market maker. Currently, its fruit from its end-of-the-season bloom is declining quickly while the summer fruit — the flora loca crop — is starting to ramp up. Its new crop will see significant increase in volume in September. Mexico’s total volume has declined from the average of about 50 million pounds per week it was exporting to the United States during the first five months of the year to less than a 40 million pound weekly average in June. In July, its weekly volume is expected to average below 30 million pounds.

California is projected to be fairly steady in July — in the 8-9 million pound range — while Peru increases its weekly shipment to about 18 million pounds.

Wedin said retailers have been promoting avocados quite heavily this year but not necessarily at blow-out prices. He expects promotional opportunities to continue through the summer even as the market strengthens. Avocados, he said, are an excellent promotional item for retailers.

Gahl Crane, sales director at Eco Farms, based in Temecula, CA, expects Peru to play an out-sized role in the late summer avocado deal this year because of California’s reduced volume. While most of Peru’s volume is usually sold in the first half of the summer, he expects a shift this year. “Over the next seven to eight weeks, I believe they will play a larger role,” he said on July 13. “They do have growers that can ship later in the summer if the market needs it. I think Peru will keep the market steady and we are likely to see an increase in shipments over the next three to five weeks.”

He noted one of the reasons for the apparent strong July market is the delay in Mexico’s flora loca crop. “They usually say it will arrive the first week of July but this year it looks more like the fourth week of July.  August looks better but I think it’s going to be a bit of a struggle in July (meeting demand).”

Donny Lucy, a vice president at Del Rey Avocado Company in Fallbrook, CA, agreed that July/August should be a good time for marketing avocados with Peru playing a bigger role. He said Mexico’s late season Negra crop is winding down and there does appear to be a two- or three-week gap until the flora loca crop gets going in earnest.

While all of the California handlers have their own specific dynamics, Del Rey typically garners a featured spot with high end retailers late in the season with its Morro Bay program. That fruit is grown near the bay that bears its name and Del Rey markets much of it under that moniker. Because of the cooler temperature where it is grown, the fruit stays on the tree for a very long time. Local growers are convinced, and are successfully convincing some others, that it is the best tasting avocado in the world in its peak late summer/early fall harvesting window. Because it is a smaller crop this year, it will be marketed during a truncated time frame. “We haven’t harvested any of it yet,” said Lucy on July 13. “We expect to begin harvest during the first two weeks of August and have this great tasting fruit for five to six weeks.”

Tagged in:

- Advertisement -

July 23, 2021

BelleHarvest, one of Michigan’s oldest grower-owned distributor of fresh apples has acquired Michigan Fresh Marketing, one of the leading produce sales organizations in Michigan. The… Read More

- Advertisement -

- Advertisement -

- Advertisement -

- Advertisement -

- Advertisement -

- Advertisement -

- Advertisement -

- Advertisement -

- Advertisement -

- Advertisement -