Increasing Domestic Avocado Prices in Chile

Published 2021년 5월 7일

Chile’s projected avocado production is initially expected to reach 220 thousand tonnes in 2021, but the actual production might vary from the projections made. . As the harvest season begins, it is expected that the production will fall by at least 30%due to drought and water deficiency across different avocado-producing regions. The expected shortage would inflate the domestic prices, making it more profitable to sell avocado to the domestic market rather than the global market. If the trend continues, Chilean avocado exports will decrease dramatically in the coming months.

Avocado is one of the most significant components of the Chilean agro-economy as the country is amongst the largest producers of avocados in the world with a production of 141 thousand tonnes and is also the 5th largest exporter of the fruit. Avocado is mainly planted in Valparaiso, which represents 67% of the total avocado-grown area, followed by Metropolitana and Coquimbo with a share of 14% and 13.2% of avocado producing area. Several varieties are planted in these regions, including Hass, Edranol, Negra de la Cru, and Fuerte varieties. Chilean consume about 30% of the avocados grown domestically, making them the country with the second-highest per capita consumption of avocados in the world.

According to USDA, the growing area is expected to remain stable at around 30,000 hectares, and the total amount is projected to reach 220 thousand tons in 2021. However as the harvest months come closer, the farmers are facing the problem of drought and water deficiency across different avocado-producing regions. The crop has been affected severely, and the production is expected to fall by at least 30% in this harvest. Even though Chile has been facing water scarcity for almost a decade now, production this year has further deteriorated due to higher temperatures.

As Chile faces a sharp drop in avocado production, the fruit prices have been roaring in the domestic market, reaching USD 8.19 per kg, almost doubled from the previous year. However, the price of Chilean avocados in Europe is only USD 2.5 to USD 3 per kg.

With higher than average prices in the domestic market, the avocado producers are likely to direct their freshly harvested produce to the domestic market instead of exporting it due to better price realization. If the higher prices continue throughout the year, Chile’s avocado exports will likely fall for 2021. Eventually, the domestic market will be saturated with fresh avocados pushing down the prices.