Market Insights|2 min read|June 14, 2018

Rising Demand for Avocado: What to expect in 2018?

The demand for avocado has never been higher. Since its introduction to the commercial market in the 90’s, the fruit that was once called “exotic” has now become the one of the most highly demanded fruit in the world.

The Rise of the Avocado Market

The history of how avocado came to be a staple diet is essential to understanding the current avocado market trend. In the 1990s, an average American consumed 1.5 pounds a year. In 2007, the number increased to 5 pounds. EU consumption is just below 1kg per capita, which is 150 times greater compared to a decade ago. Behind this remarkable phenomenon are cultural and social factors. Rapid growth in the Hispanic population in California lead to a burgeoning of Mexican restaurants that serve dishes featuring avocados.

In the 1990s, a lift in banning of Mexican products allowed a surge of Mexican avocados into the American market. The number soared in 2007 when Mexican avocados were allowed full access to the American market. The adoption of Haas avocado into the commercial market allowed mass production. The Haas cultivar ripe slowly and its thick bumpy skin allows a longer shelf life compared to other fickle varieties. Most importantly, marketing avocados’ health benefits successfully targeted the rising health-conscious consumers who then adopted avocado as an everyday diet.

Global avocado wholesale price trend (source: Tridge

In the summer of 2017, the global avocado price reached its peak after months of a steady but rapid rise. Soaring demand from the Asian market is making substantial impacts and may disrupt the global avocado trade trend.

Global Avocado Production

Mexico, Dominican Republic, Peru, and Colombia are major avocado producers. Mexico covers about 34% of the world Avocado production and in 2016, the production volume reached 1,889,354 tonnes. The Dominican Republic takes up 10.8 %, having produced 601,349 tonnes in 2016. Peru and Colombia produced 455,394 tonnes and 309,431 tonnes in the respective order. Other producers such as Israel, Spain, Italy and the U.S are also important avocado producers in the European market.

Major producers of avocado (source: Tridge)

Avocado is a fickle crop and production volume is greatly impacted by its nature to bear in alternating seasons and external factors such as the weather, water supply, and pest control. Last year, Mexico and America greatly suffered from a huge supply shortage. Mexico’s supply was short by 20% due to the low harvest year and avocado grower strike that halted shipments. California, where most of U.S. avocados are produced, suffered from a severe drought and met only half of its average production.

Global Avocado Trade Pattern (2001 to 2016)

The world’s imported quantity of avocado leaped from 315,262 tonnes in 2001 to 1,913,875 tonnes in 2016. The U.S, after making a huge leap from 59,385 tonnes in 2001 to 115,038 tonnes in 2002, has been the biggest avocado importer in the world. In 2016, the U.S imported 1,913,875 tonnes. In 2017, $2.6 million worth of fresh avocados were imported.

Major avocado importers, by value, USD (source: Tridge)

Demand for avocado is also high in the Netherlands: 820,775 tonnes were imported in 2016 and 900,186 tonnes in 2017. The Netherlands is also a big avocado exporter: 147,540 tonnes were exported in 2016, making the Netherlands the third biggest exporter next to Peru, which exported 194,098 tonnes in 2016. Once the biggest importer in 2001, the range of France’s imported avocado quantity remained around 95,000 until 2016, when it increased to 134,360 tonnes and 145,813 tonnes in 2017. The U.K is the fifth biggest importer: 383,736 tonnes were imported in 2017, which is more than 4 times the amount imported in 2001.

2017: Notable Changes in the Global Avocado Trade Pattern

In 2017, avocados dominated the Chinese fruit market. In just 2017, China imported 32,100 tonnes of avocado. This is a significant increase from 25,128 tonnes in 2016, and compared to 32 tonnes in 2011, China increased avocado import quantity by 1,000 times.

Peru, Chile and Dominican Republic are also producers of top-quality avocados and are newly rising in the global avocado market. Peruvian avocados had successfully filled-in the new opening in the avocado market, gaps caused by poor crop harvest in Mexico and the U.S. In 2017, Peru exported over 150 million pounds of avocados, more than twice the amount exported in 2016. Chile is exceptionally excelling in the Chinese market. In 2016–2017 season, more than 13,000 tonnes of Chilean avocados were exported to the Chinese market.

2018: What to Expect?

In 2018, the avocado market is expected to be very competitive with the production volume expected to recover to its average amount. Mexico, which suffered a significant shortage in 2017, is forecasted to produce 18 M tonnes. Whether the supply will meet the demand is uncertain — the avocado market in China is booming and demand from the American market is increasing at a consistent but a fast rate.

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