While that is similar to last year, it is under much different circumstances. In 2024, the California avocado crop was initially predicted to be on the low end of the spectrum, at just over 200 million pounds, possibly pushing the 225-million-pound number. But as the season wore on, good growing conditions and new groves of relatively young trees outproducing expectations saw the crop continuing to grow in volume. Even a revised estimate in late spring proved to be too low.Another important factor is the continued growth of the organic category. Johnson noted that the volume of organic avocados in the market in 2024 topped 2023 by 19 percent. He said that is very important as organics are a key revenue driver for retailers. “This upcoming spring and summer, the industry expects a promotable supply of organic avocados out of California,” he reported. “Organic avocado shoppers spend 89 percent more on avocados a year than conventional avocado shoppers. So, marketing to this target demographic is an important strategy at retail.”
The expected spring volume of avocados from Mexico is always an important factor for California growers. With an expected share of market above 80 percent during a typical season, Mexico’s weekly volume plays a huge role in the FOB price. So far this calendar year, Mexico’s volume has fallen below previous estimates and virtually everyone in the industry expects this to continue throughout the spring. The market has been strong with no let up in sight.
Virtually all industry folks contacted predicted that California would sell most of its fruit under favorable marketing conditions in April, May and June. During big promotional periods, including the Cinco de Mayo and Fourth of July holidays, huge volumes of California fruit are expected to be moved, further limiting supplies as the season moves into the late summer period.
Marketers are not expecting a demand-exceeds-supply situation, but they are anticipating strong demand keeping the market price at a relatively high level.
The one disruptive factor with an unknown and unknowable impact is the Trump tariffs that are on-again, off-again. At the start of the writing of this article, they had been in place for two days, by the end of the previous paragraph, the tariff on Mexican avocados had been put on hold for yet another month…as was the case Feb. 1.
Longtime avocado industry veteran Giovannie Cavaletto told The Produce News on March 5 that it appeared the tariffs “have been called off for the time being.”
He said it was his understanding that the money already collected the first two days would be refunded, but he was not particularly happy with the chaos. “We spent a lot of energy this week working through calculations, access to capital, payment terms and supply/demand scenarios,” he said. “This process has been disruptive.”
Like the rest of world business community, avocado sellers are uncertain if and when tariffs will be imposed and what impact they will have. All week, political pundits were speculating in the media that avocados would cost $4-5 at the grocery store if the 25 percent tariff was in place. While the math doesn’t support that much of a retail increase, avocados would certainly have gone up in price with no history to lean on to determine consumer reaction.
That bullet has been dodged temporarily but could be back in play in a matter of weeks.
