South African Avocado Exports Set to Increase in Volume at a Lower Price

The South African avocado export industry has released its first estimate for the new 2023 season, predicting that the country will export around 18 million cartons this year. This would represent an increase of 10% or of nearly 2 million cartons from last year’s 16.3 million cartons. Besides a larger crop expected for this year, marketing prospects are also reported to be much better than last year: particularly in the early season, which this year will start earlier than expected. However, this year's early crop has brought an unusual overlap of large volumes from the previous season and the new one, which has directly dragged down the price on the domestic market.

Due to the heavy rains experienced in November, a large portion of late-season Hass, Ryan, and Fuerte got pushed to being picked in January. At the same time, South African avocado season started quite early this year, with the Fuerte variety approving moisture levels testing for harvesting since week 4 of the year. Therefore, the presence of so much late-season combined with early-season fruit available on the markets at the same time is abnormal. The high volumes of fruit available at the end of January meant that fruits in early-season production areas like Tzaneen and Levubu did not see high prices as they usually do at the beginning of the season. The volumes on the open market were exacerbated by imports from neighboring African countries like Tanzania and Mozambique.

According to the Tridge Price Index, in week eight of 2023, many avocados entered the local market simultaneously, causing the price to plummet by 14% WoW and 45% MoM. Due to the presence of so many late-season avocados from 2022 and this year's early-season fruits, the South African Fuerte variety price has dropped to USD 0.75/kg in the Johannesburg wholesale market. The price is also 17% lower than the price at the start of the season last year. The price for the same Fuerte variety but Class 1 Grade in the Cape Town wholesale market was higher than the Johannesburg one at USD 1.50/kg but with a considerable drop of 38% MoM in W8.

To add to the bearish turn of events, Kingsley Nkwane, Tridge’s Origination Manager in South Africa, stated that domestic avocado prices have kept dropping since W6. By the end of W7, South Africa's avocados were selling at USD 0.94/kg in the domestic market, a drop of 13.73% WoW from the W6 selling price of USD 1.09/kg. “The drop is due to the increasing supply of avocados from local suppliers as the South African avocado season is starting. Avocados that were previously in the market were imported from other origins,” he reported.

Another factor that has been taken into account to project a larger export volume is the announced delay of the start of Kenya's avocado season. According to Benard Mutai, Tridge’s Origination Manager in Kenya, the avocado season is expected to be delayed until mid-to-end March 2023. “Both key varieties, Hass and Fuerte, sourced from smallholder farmers, have been affected by the severe drought affecting Kenya for the past two months. The indicative prices are also high due to low available volumes expected at the beginning of the season. In W8, the indicative price for avocado stood at USD 4.5-5/4kg box FOB Mombasa Port, Kenya,” he reported.

With a larger crop for exports, lesser prices than last year, and the season’s delay of one of its main competitors, South African avocados are projected to have a great year, particularly in the Europen market, where they hold a great presence. South Africa is currently the second largest summer-season avocado supplier to the UK and EU, and for this next season, its supply to these markets will play a key role in the availability of avocados in the European market.