Global supplies increasingly impact U.S. avocado market
As more and more points of origin increase their supplies of avocados to the United States, the marketing situation is being impacted like never before.
California avocados controlled the market for decades, with Mexico being the major market decider for the past 15 years. Mexico is still in that dominant position, but now several other countries are playing increasingly important roles with the ability to impact the market price like never before. And the importance of those other suppliers is expected to increase as time goes on.
Hector Soltero, senior director of sales planning for Oxnard, CA-based Mission Produce, recently articulated that theme to The Produce News. In August, he outlined Mission’s current sourcing locations noting that Mexico was increasing supplies, Peru would be declining in August and Colombia would come back into the market in mid-September. “Mission’s sourcing strategy leverages the rotating seasonality from premium growing regions around the world in order to promote a year-round supply of high-quality fruit,” he said.
The hot avocado market that defined the market during the first six months of this calendar year occurred largely because Mexico did not have the production it anticipated. The market took a dip in July as Mexico’s volume increased, but also because California, Peru and Colombia represented more than 50 percent of the volume.
While Mexico’s bigger 2022-23 crop will again represent at least 90 percent of the volume as we move deeper into the fall, it is clear other sources are important players in the supply/demand balancing act.
Peru, which sent about 190 million pounds to the U.S. market in 2021, will far surpass that number this year. They already hit that number in early August with another month of shipments headed to the United States. At one point, there were projections that volume could approach 290 million pounds. While that seemed unlikely as the market price fell in early August and Mexico ramped up its volume, Peruvian exporters will clearly smash their previous record.
Peru continues to point to the U.S. market as one of its best opportunities for growth in the future. Europe continues to take the majority of Peru’s export avocados, but the U.S. market is the most lucrative in the world and Avocdos From Peru continues to develop its place in the market with its ambitious and unique U.S. marketing program.
Colombia is now the new kid on the block with promised growth moving forward. It has projections to be a major player in the future and expects to trail only Mexico in shipments to the U.S. market. The Colombia Avocado Board recently announced a 270 percent increase in total avocado pounds shipped to the U.S. for the 2021-22 season. Nearly 300 Colombian avocado orchards across more than 9,400 hectares have completed the necessary certifications to ship product to the United States.
“We’re incredibly proud of the growth we’ve seen over the past few years,” said William Watson, managing director of CAB, noting that continued growth is expected.
Colombia gained access to the U.S. market in 2018. The 2021-22 season ended with it shipping more than 24 million pounds.
“We’ve never underestimated the power of the U.S. market and we are so happy to expand our volume to meet the growing demand while also offering the value of Colombia’s proximity to ocean ports providing valuable freight advantages,” said Ricardo Uribe, chairman of CAB.
Colombian exporters are expecting U.S. shipments to grow exponentially rather than incrementally over the next handful of years.