Weekly Product Updates

W43: Avocado Update

Fresh Avocado
Published Nov 1, 2023

In W43 in the avocado landscape, Colombia aims to become the world's second-largest Hass avocado producer by 2040, potentially surpassing Chile and Peru, the current leaders in South America. Colombia boasts a competitive edge due to its abundant biodiversity and sustainability focus. The country's tropical yet temperate climate with high annual rainfall ensures avocados receive natural watering, reducing reliance on underground water resources. Colombia's strategic location near key ports facilitates fast and efficient shipments to East Coast markets, with delivery times as short as 2 to 5 days. Promotion strategies focus on highlighting Colombian avocados' year-round availability, projected volume, competitive advantages, ease of shipping, and sustainability. Tailored promotions and market-based programs that showcase Colombian culture are forecasted to emerge as Colombian avocado volume increases in the United States (US) market.

Peru's agricultural exports have shown remarkable growth from Jan-23 to Aug-23, reaching USD 5.71 billion, driven by increased fruit shipments, despite the climatic impact of the El Niño Phenomenon. Avocados led the agro-export ranking, contributing USD 927 million (with an 18% share), followed by fresh grapes at USD 659 million (12%), fresh cranberries at USD 344 million (6.5%), fresh or chilled asparagus at USD 212 million (4%), and fresh mangoes at USD 207 million (3.9%). The growth of exports was driven by avocados, which increased by 14%, and fresh grapes, which saw a 12% increase from Jan-23 to Aug-23. The US, Holland, Spain, Ecuador, Chile, China, England, Mexico, Colombia, and Germany were the top destination countries, concentrating 78% of total exported value. The trade balance registered a surplus of USD 1.44 billion during this period, reflecting a 2.7% increase compared to last year. Regionally, notable growth in agro-exports occurred in the mountain range, jungle, and coastal areas, with increased sales of avocados and various fruits contributing to this positive trend. Peru's agriculture sector continues to demonstrate strength and resilience in its exports, with avocados playing a crucial role in this success.

Furthermore, the president of the Association of Hass Avocado Producers and Exporters of Peru (ProHass) reported Peru's 2023 Hass avocado campaign saw exports of 570 thousand tons, similar to 2022. Climatic issues affecting fruit size and temperature rise contributed to smaller sizes, leading to 20% less caliber than anticipated. Price fluctuations occurred during the year, with strong prices in the first four months and a drop later in 2023 due to a surge in Peruvian avocado supply.

Export challenges were seen in the US, where a 40% volume contraction occurred, driven by Mexican supply and fruit size limitations. Europe experienced 9% growth but faced price impacts due to higher avocado volumes. Asia, particularly China, saw a 41.5% growth in avocado shipments. Looking ahead to the 2024 campaign, challenges may arise from unpredictable weather conditions and the El Niño phenomenon, which could impact the season. Producers are monitoring the situation closely to maintain Peru's position as a major avocado exporter.

Lastly, Peru's agribusiness sector, particularly in the La Libertad region, is facing severe challenges due to the El Niño Phenomenon. High temperatures and water scarcity have led to a significant decrease in the production of key fruits such as blueberries (down 50%), avocados (down 20%), and mangoes (down 75%). This crisis has resulted in a substantial reduction in the workforce, potentially leading to thousands of job layoffs. The Association for Sustainable Agricultural Development (ADAS) has called on the Peruvian government to implement measures to reactivate private investment, mitigate the impact of El Niño, and prevent the crisis from affecting the regional economy and national food supply. 

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