Main exporters include Propal, Agricom, Jorge Schmidt Cia, El Parque, Santa Cruz, Subsole, and Cabilfrut. These top seven players account for 83% of the total export volume.
Spot purchases vs. Program deals
• A few UK-based importing firms similarly confirmed that there are only a very few spot purchases compared to program deals; spot purchases are usually done in wholesale markets which are mostly closed since many of them supply to F&B businesses, which has experienced a slow-down in operations.
• Moreover, Chilean avocado harvests aren't as plentiful as they once were: Supplies have become very limited since the climate has not been favorable for a good harvest. Pricing has not been attractive for exporters; the few Chilean avocadoes exported to the UK have been mainly absorbed by the retail chains (since the usual channels for avocados, like tourism and the F&B industry, are mostly closed.)
• Retail chains are only conducting program deals. A manager from one of the UK-based importing firms made a rough estimate that at least 75% of the deals are program deals.
Q3 (July ~ September)
• Needs to settle everything by end of July, latest by mid-August as the first shipment needs to be ready to be shipped out by end of August, gradually increasing in September and hitting the peak in October
• Needs to start tapping the buyers accordingly in order to target sales accordingly
• Pre-booking & Overtaking usually takes place in July and by August, most of the suppliers are pretty much locked in
Q4 / Q1
• October is usually the peak season for the shipments
• Shipping operations should take place in Q4 ~ Q1, meaning during this period, only operations should be executed
• The Chilean avocado season normally continues until the end of Q1, meaning that approximately 6 months will be fully dedicated for shipment operations once we lock in programs
The issues when approaching Chilean avocado suppliers include the existence of just a few main players, a decrease in production levels, and low international prices caused by COVID-19. These issues are challenging to meet but doing so will be productive since demand is greatly exceeding supplies at the moment.
Possible Issues when contacting suppliers:
1. Only a Few Main Players in the Industry
• Roughly 8 companies dominate the industry, providing only a narrow window of partnership possibilities.
2. Decreasing Production
• Drought and insufficient water supply will make the return to former production levels challenging
• COVID-19 caused a drop in prices and discouraging export levels, with a large portion of production used to meet domestic demand