The latest USDA estimates of the Mexican avocado harvest for the market year 2017/2018 are between 1,8 and 1,9 million tonnes. In general, since there were favourable weather conditions, a good production is expected. In addition, according to sources, the implementation of plant-health measures are contributing to a better yield.
Production has increased in comparison to the previous year. A volume van 1,7 million tonnes was mentioned for 2016/2017. Growers contribute the lower yield to, among other things, the winter rains. They are talking about a 20% lower volume than in 2015/2016 when the harvest came to 12,9 million tonnes.
New techniques increase yields
Within the sector, investments in technological improvements are being made. This is in order to ensure that the avocados are free of chemical or organic residues. With an 80% stake, Michoacan is the market leader in the production of Mexican avocados. The largest part of the cultivation is, however, spread among smaller plantations of five to ten hectares. Many growers see the advantages of new techniques. This is despite rising costs due to the decreasing value of the Peso against the American Dollar. Yields are at eight to ten tonnes per hectare. Depending on which technique is used, volumes can be higher.
Michoacan's growers sell their avocados mainly on the spot market, where a price per kg is agreed upon. The extra costs, such as packaging and transport, are carried by the packing centres who buy the crops. These packing centres are even responsible for supplying a team of pickers. The Hass is cultivated in most provinces. This variety is, thanks to its longer shelf life, suitable for export to far-off destinations. Other varieties, such as the Fuerte, Criollo, Bacon, Pinkerton, Gwen and Reed are grown on a smaller scale
Illegal expansion of acreage
In local newspapers, concerns are being aired about deforestation for, among other things, the illegal expansion of acreage used for avocado cultivation. While the branch organisations frown upon the practice, the profitability of avocados on the global market is a tempting motive for illegal acreage expansion. In 2016/2017, the total acreage was estimated to be 220 334 hectares. This is an increase of 7,3% in comparison to the previous season. It is expected that this will grow in the coming season since growers in an increasing number of states in Mexico are showing interest in the cultivation of avocados. The good demand, both domestically, and internationally, is contributing to this trend.
Domestic consumption depends on the export volume. Growers with access to international markets rather ship as many avocados as possible to markets where top prices are paid. In 2016/2017, domestic consumption was at 656 000 tonnes. This was because high prices made the product less accessible. A year later, this was 760 000 tonnes. This was thanks to higher production, although the final figure is dependant on supply and prices. The avocado is a staple product for Mexican households. Per capita, 6,5 to 7 kg avocado is consumed per year. Prices were higher in 2016/2017 as compared to the previous year. This upward trend has not stopped, thanks to high demand and a smaller available volume.
Avocado oil and guacamole
Exports remain the driving force behind growers' profits, despite the fact that other niches are being created. Think of the market for avocado oil in the cosmetic industry as an example. This has to do with the consumers' perception that avocado byproducts are expensive.
The market for guacamole is, however, growing. Annually, about 170 000 tonnes of this product is exported. Important markets are the US, Europe, Middle East and Asia. There are, however, no official statistics to show the increase in this trend.
In 2017/2018, exports of fresh avocados will increase to 1 million tonnes and will, therefore, follow good international demands. Since the Mexican currency is devaluating, exports are becoming more attractive. Yet, in 2016/2017, nine percent fewer avocados were exported than 2015/2016. The weather was the spell breaker. In that year, just less than 900 000 tonnes were exported. The largest portion, by far, was destined for the US. This country remains the most important market, good for almost 80% of exports. Japan and Canada are strategic niche markets. Japan is good for eight to nine percent of exports, while Canada takes six to seven percent. Of the 300 packing centres in Michoacan, 37 growers have an export license for the American market. The other production areas in Mexico focus on the other export markets, such as Japan, Canada, France and Spain.