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China's demand has an impact on avocado prices
Even though it only accounts for nearly 2% of all Peruvian avocado exports, China could be a very important factor in boosting the value of this fruit to the benefit of producing countries such as Peru.
Benjamín Cillóniz, president of the consultancy Inform @ cción, said that, although the main destinations of the fruit were the Netherlands, as the port of Rotterdam is a gateway to several European countries, Spain, the United States,and the United Kingdom, the Asian country's demand was helping to boost the exponential increase of international prices.
He also said that recently traders from Chile had faced some difficulties to obtain Peruvian avocado because of this factor. "They have sought us out and done the impossible to get avocado and it has been difficult to compete against the main markets like the USA, Europe, and China, which do not have significant volumes but which helps increase prices. China is having a significant impact on avocado demand," he said.
The specialist also said Costa Rica was a market of interest for Peru, due to the increase in sales in the last two seasons caused by the ban on Mexican avocados; which in turn increased prices and the demand for Peruvian fruit in the Central American country.
The product would be peaking so much in the international market that it's been impossible to get avocado from third parties due to the exorbitant prices they are demanding and the conditions they are imposing, such as the advance payment of 100% of the product, he said. However, he added, this is good news for producers, as they can get increasingly more competitive prices.
The market is taking everything there is
Cilloniz said that a few weeks ago he had seen some poor quality avocados in a US supermarket, which would indicate that the market was taking everything being produced. This means that the destination countries might be more tolerant of defects on the exported fruit, "which does not mean we can send just about anything, but it probably means we'll achieve more important export percentages than in other crops."
The manager of Inform @ cción also stressed that the production of this fruit had diversified and that exports were no longer dominated by a single company. In 2008, he said, Camposol accounted for more than 50% of Peruvian exports, but now there are other players such as Drokasa, Cerro Prieto, Camet Trading, Avocado Packing Company, and Agrícola Viru, among others. In fact, Drokasa Agricultural Society is currently the main exporter with its crops in Barranca, which make Lima the region with the highest crop production, followed by La Libertad, Ica, Lambayeque, and Piura.
Finally, he said that they had to wait to see the effects that the production in Olmos, northern Peru, where there is a good amount of avocado that still isn't in its productive stage, will have.
Publication date: 7/17/2017
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