July sizing a bit of a challenge on avocados

From Fresh Plaza | 17 July 2023

Overview of avocados in the U.S. market, complemented by charts from Agronometrics. Original published on July 11, 2023. 

Avocado supplies are adequate and going through a transition right now. “The breakdown is a bit different than we expected a month ago. Mexico underwent a heat wave for a few weeks and it accelerated maturity on the old crop and sort of stunted development of the new crop,” says David Billings of Stonehill Produce Inc.

Here’s more on the various regions supplying avocados to the U.S. currently.

Mexico: The 95-degree range of weather in Mexico stressed the avocado trees and impacted the amount of old crop avocados that, just a month ago, looked readily available to ship to the U.S. “So, Mexico’s contribution is lighter than we otherwise expected and more dependent on new crop right now,” says Billings.

That means avocado sizing from Mexico has shifted to predominantly small and medium sizes because of that heat. However, looking ahead, supply out of Mexico should normalize by around mid-August with more development and more new crop orchards becoming available.

avocado volumes by origi 9

Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)

California: California is picking up some of the slack in supply, particularly in that larger-sized fruit. “However even California is not going to completely fill the size gap. Plus, their fruit will get smaller as harvest moves up the coast,” says Billings. That means that along with smallish Mexican fruit over the next few weeks, California will also start getting smaller toward the end of July.

Peru: Meanwhile Peru is picking up that differential, even though at one point it too had a delay in its crop thanks to weather conditions. That said, prior to mid-June, getting an early start on the Peruvian crop was not seen as a major priority. “Then three weeks ago at the tail end of the Mexican season, everything changed,” says Billings.

Now Peru is accelerating its arrivals and should round out the large size component, for the most part filling the gap created by the lack of old crop Mexico.

As for demand, pricing has strengthened such that the spot market has begun to slow, especially on Mexican avocados. “When the spot market takes a great leap, it catches everybody by surprise–spot and program business. Then as prices level out, things get reassessed as the industry is trying to do right now. Because of this, demand is a bit off but in another two weeks or so, it should come along,” says Billings.

In all, the next few weeks, the focus will be on sizing. “I look to the beginning of August when we’ll be in much better shape overall size-wise,” he says. “Right now, in Mexico, there’s a meaningful new crop-old crop pricing gap that in the next few weeks should disappear as the new crop becomes more dominant.”

The News in Charts is a collection of stories from the industry complemented by charts from Agronometrics to help better tell their story.

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