Colombian Avocado Market Guide

Mexico and Peru's avocado markets are the Colombian avocado market's main competitors.

Colombia’s major avocado-producing regions are Tolima, Caldas, Antioquia, Santander, Valle del Cauca, Risaralda, and Quindio.

- 36% of all avocado productions come from Antioquia

- Valle del Cauca has the biggest yield per acres, producing 13 MT per acre

- Caldas produces 12 MT per acre

- Tnioquia produces 11 MT per acre

Global Avocado Market Size: USD 249.3M (2020)

+162.3% YoY Growth in 2020

+105.7% CAGR during 2013-2020

Avocado Export Market Size (2020)

Mexico: USD 6.9B

Netherlands: USD 1.1B

Peru: USD 1.0B

Spain: USD 440M

Chile: USD 346M

Colombia: USD 249M

Avocado Import Market Size (2020)

Netherlands: USD 141M

Germany: USD 28M

Spain: USD 24M

UK: USD 23M

Norway: USD 8M

US: USD 7M

Netherlands (+162.3% YoY): Colombian Avocados are growing in demand all over the world and the trend is very clear. A remarkable increase in imports has been spotted in the Netherlands, which has already been a top importer of Colombia avocados, with imports surging by +162% in 2020.

US (+94% YoY): Hass avocados were granted admission in 2017, and US import protocols were extremely strict before 2020. However, in 2020, USDA approved the application for the Colombian Avocado Board (CAB) to operate under the Hass Avocado Promotion, Research and Information Order (HAPRIO). With this, CAB would receive 85% of the levies charged on Colombian Avocados for promotions and other purposes. Colombia has been placing large efforts into promotions to target the US market. With this, export volumes to the US have started to rise aggressively.

Germany (9,385% YoY): In 2020, the overall demand for avocados in Germany rose by 7%. During the same period, Germany's import of Colombian Avocados surged by 145% YoY. More European buyers have been showing a greater preference for Colombian Avocados given its year-round seasonality.

• The supply chain of Colombian avocado starts from growers, which then goes to packers and finally to the exporter. 

• There are two types of producers and buyers:

1. Producers
   Type 1: National Market Type 2: International Market
2. Buyers
   Type 1: National Market / Type 2: International Market
   (Usually in the form of a packing warehouse)

• Most of the time, exporters have contracts with smaller growers. They then pay a separate packing facility a certain fee to pack their products. For this reason, many exporters share packing facilities. The larger, top 3-5 Hass avocado exporters have their own packing facilities and farms.
• Buyers place orders in advance, by making pre-purchases.
• In 2020, the Top 5 largest Colombian Avocado exporters occupied 61% of total export shares. 32% of the remaining shares included the shares of 20 smaller companies. The top 5 largest Colombian Avocado exporters and the 20 smaller companies altogether constituted 93% of total exports.
• Large companies dominate the market. Aside from the top 5, there exist multiple small exporters who only have around 1% of the market share. 
• In the Colombian Avocado Value Chain, agents or brokers don’t play a big role because existing exporters are already well-connected with suppliers.

There are no middlemen since the objective of the exportation companies is to sell directly to final buyers.

In order to secure supplies, one must put in orders at least 2 months in advance to get hold of a substantial amount of volume because it requires time for suppliers to check harvest outcomes and packing house capacities. If seeking to spot-buy, one must look for empty spaces to schedule and secure supplies.

Quality-Related Issues

1. Shelf Life, especially when the product is sent to far areas, becomes a critical issue. For example, it takes 17-18 days to get to Europe (Rotterdam) from Colombia. When discovered quality issues are not caused by logistics, however, the supplier is held responsible.

2. Quality Check Process

- When harvested, the outer part of the product has to be checked for scratches and burns. During the packing and sorting process, the quality has to be checked again. After packing and placing products in the warehouse, the atmosphere (temperature, humidity, warehouse conditions) must also be controlled.

- Suppliers are usually the ones to perform quality inspections. For third-party inspection, however, buyers must shoulder the cost.

- Colombian Avocados are affiliated with Global Gap, Rainforest Alliance, Fair Trade, HACCP, IFS, BASC, Organic Agriculture Europe, and USDA Organic (only for organic avocados)

- Most Colombian Avocado suppliers are affiliated with Global Gap since the market is one of the top exporters to the EU

- There are not many specific regulations unique to Colombia, but Colombia's rules pertaining to minimum avocado size may differ

Colombia's local logistics and transportation is well-established. The two major ports for avocado transportation and logistics are Cartagena and Buenaventura. Avocados going to Europe pass through the Cartagena Port, which is approximately 1,236km away from major avocado production regions. By car, it takes approximately 26 hours from the production region to the Cartagena port.

- Colombian Avocado Suppliers that do not own a farm or packing house will (1) purchase from their contracted farms, then (2) bring the avocados to the packing house, and (3) take their avocados to the port via truck

- The majority of the deals are done in FOB and CIF. Larger companies prefer FOB, while smaller players usually use CIF

- Avocados with sizes between 12-24 are the most sought-after types. This demand is followed by Avocados with sizes 26-32 

Top destinations are the Netherlands, Germany, Spain, United Kingdom, US, Switzerland. Since Colombia is the #1 supplier to Europe, exporters are searching for new markets in Asia, the Middle East, and North America. 

There is rising demand from Europe, which is the fastest growing importer in the last 5 years (2016-2020) (ex. Spain +2509.49% / Germany +1801.07%)

An upside to exporting to Europe is that it only takes 18 days to ship. However, because exporters have become accustomed to exporting directly to supermarkets in Europe, avocados tend to sell at higher prices.

The leading importers of Colombian avocado are all from the EU. Germany's import share in Colombia's avocado export totaled 32%, and Spain occupied a total of 28% with the United Kingdom taking of total 27% shares. However, imports from other countries are growing as well, and notable among these countries is the growth in imports from the USA, Estonia, and Luxembourg.