OXNARD, CA - Peruvian avocado exports to the U.S. market have ended for the season, and Freska’s Jimmy Lotufo took the time to share with me where the market currently stands.
“Chilean Hass have made their presence known on both the East and West Coast recently,” Jimmy says, explaining that this is tightening up that market as the market continues in an extended transition period. Right now, Jimmy explains that volumes are lower than last year, with exporters anticipated to ship approximately 75 million lbs this season.
“California continues to decline as the end of the season is very near,” Jimmy adds, explaining that Chile continues to develop other markets like Asia and Europe for its fruit. “Looking ahead, this leaves Mexico as the only major source country of Hass avocados for the next 5 to 6 months.”
Mexico is currently exporting approximately 33 to 35 million lbs per week to a market that demands over 45 million lbs, Jimmy explains, with weather having presented a challenge in the season.
A plus, however, is both pricing and promotion.
“The highlight at this point of the season for Hass avocados has to be the price elasticity of the fruit,” Jimmy tells me. “Field pricing for both domestic and imported avocados have remained high and sustainable over extended periods of time, leading to higher sustainable FOBs for marketers and handlers. Even with higher prices downstream at the consumer levels, demand continues to push the category forward into new uncharted waters.”
This, he adds, is also the challenge the category is facing today: Worldwide demand for Hass avocados growing at a rapid pace, with the industry learning how to balance and maintain the U.S. market.
With that, we move into the fall sports season and the time of more promotion.
“Football is our favorite time of the year to enjoy guacamole with friends and family. Fruit will always be available, as long as price elasticity for hass avocados holds. With the season in an extended transitional period, promotional opportunities will come from the consumers who are demanding more avocados,” Jimmy says.
Currently, the 2016/2017 fiscal season total hass avocado volume for all countries of origin stands at 2.1 billion lbs, but will be reassessed and updated in December when Mexico will give new guidance on the "regular" crop estimates.
AndNowUKnow will keep you up to date as we continue to keep our ears to the ground for all the latest new for avocados and beyond.
