Increasing Trend in US Fruit Imports Affecting Prices: Peru and Mexico

Published 2022년 4월 20일

In FY 2021, US imports of fresh fruits reached USD 22.23B for a 15% YoY increase. The US imports 67% of its fresh fruits, and the share has kept rising due to increased US income that supports a year-round demand for fresh produce. Mexico remains the leading supplier of fruits to the US, with about 45% of the share. However, Peru has reached a new export record of fresh fruits to the US and has had the fastest growth in fresh fruit exports to the US over the past decade. In this Tridge analysis, we look at the main fruit import trends from Mexico and Peru to the US and their effect on US prices this year.

US imports of fruits jumped 15% YoY in 2021 and have reached USD 22.23B, while US fruit exports have just gained a modest 4% growth. According to the USDA, in 2021, 67% of the fruit in the US was imported, with the share of imported fruits considerably increased over the last years due to year-round demand for fresh produce in the country. Furthermore, domestic production of most fresh fruit products in the US has declined due to unfavorable weather caused by global warming, which has caused, in most cases, an increase in imports.

Mexico, Chile, and Peru are today the three most important suppliers of fresh fruit to the US, combined together dominating the market and benefiting from increasing demand from the US. Mexico remains the leading supplier of fruits to the US with about 55% of the share, dominating the US market by its proximity and trade agreement. However, over the last years, Peru has positioned itself as the third-largest fruit supplier to the US by increasing the export volume of key products.

Peru: Fastest Growth in Fruit Exports to the US

Peru’s fruit exports have substantially grown during the last decade, rising from USD 540M in 2010 to USD 3.8B in 2020. In 2021, the US imported USD 1.97B in fresh fruit from Peru, representing a 12% YoY increase. With that increase, Peru represents 9% of all imported fruit to the US, and it has been confirmed to be the third-largest supplier of fresh fruits behind Mexico and Chile, reaching a new record value exported to this destination.

Table grapes, blueberries, and avocados drive Peru’s fruit exports, followed by steady citrus and mango sales. The US market represents 40% of Peru’s total fruit exports and has become an important market for Peruvian fresh fruit products. Exports of blueberries to the US went from USD 56M in 2010 to USD 540M in 2020, table grapes from USD 200M to 443M, and avocados from USD 138M to USD 233M.

Mexico: US Market Dominance Increase in Key Products

Due to the proximity and custom tariff benefits through the USMCA trade agreement, Mexico is the primary supplier of fresh fruits to the US, holding about 45% of all imports of fruits. For FY 2021, US fruit imports from Mexico had a 7% YoY increase to an estimated USD 8.7B after a 2% decrease in 2020. Until 2019, Mexico provided more than half of US fresh fruit imports by value, worth over USD 8.4 billion. However, since 2020, imports from Chile and Peru have gained substantial market share in the US, particularly for products such as avocado, grapes, and berries.

Avocados, strawberries, mangoes, watermelons, and blackberries are all fruits from Mexico that dominate the US market, with all having more than 50% of the US import share. For all of these products, the US has seasonal domestic production that hasn’t been able to meet the all-year-round increasing demand of American consumers. Therefore, US importers and retailers have all turned to imported products from Mexico.

Upward Trend in US Imports Affecting Prices

US consumption of fresh fruit has exceeded domestic production for many years. Income growth, combined with better market access due to trade liberalization, has increased year-round access to fresh fruit products, which for the most part, grow seasonally in the US. At the same time, high input costs, logistics constraints, labor shortages, and continuous inflation from the COVID-19 pandemic have made prices for some fruits soar in all exporting markets to the US.

Increases in production costs in Mexico and Peru have raised the price of avocados in the US. In addition to this year’s production decrease from Mexico and a ban imposed on Feb-22 on all Mexican avocados, the increase in agricultural inputs has made US avocado prices soar by 114.9% YoY. Additionally, the price of fresh Peruvian avocado increased by 78.1% YoY in W2 of March-22 due to increased production and freight costs, which worsened avocado prices for US consumers.

Table grape prices in the US also rose in Q1-22 due to increasing demand and costs, mainly in Peru and Chile. On W2 of 2022, the price for Peruvian grapes in the US wholesale market increased by 30% YoY, reaching USD 5.50/kg. While the same week, the price for Chilean grapes in the US increased by 32% YoY to USD 3.70/kg.

Blueberry prices in the US have also been on an upward trend over Q1-22. Blueberries of Peru origin in the US have increased in price by 19.4% YoY on W3 of Jan-22 and had maintained that increase until W3 of March-22. The opposite effect happened with Mexican blueberries, for which the price decreased in the US market at the beginning of the year. Since W2 of Jan-22, the price decreased by 37% YoY and remained the same until W3 March-22 when prices started to increase due to limited availability and increases in cost.