US consumers have been going loco for avocados it seems – California’s fruit has been reported as high as between $2.50 and $3 per piece; Mexico too. “It’s been a crazy time – July and August - with Mexican volume being really reduced – not the volume we’d anticipated,” says Bob Lucy, senior sales associate of Del Rey Avocado. Californian volume is winding down as well as Peruvian fruit. Chilean avocados are just starting. “Prices are crazy high right now,” he says. “But we do think probably within the next few weeks Mexico will start to be doing much more harvesting and we’ll probably see relief by mid-September on volume. There will be a big change in prices that’s for sure.”
High prices
He says you can walk into some retail stores nearby and find them for $2.49 each – a lot of those are the 48s and some are 60s. “Retailers have put the price up in that area that’s fitting with the prices we’re selling per box – anywhere from $60-$80. It’s just crazy high.” Del Rey Avocados are currently selling for about $70/box in 60s and larger.
Much lower prices last year
Last year the fruit fetched about $40 per box “which is still very good money,” Lucy says. Movement was much different – last year there were about 45 million pounds being moved a week; this year it’s between 35 – 37 million. “We’re shorting the US market by 10 million pounds a week and when you short it by that amount you get a tremendous increase in price.” According to Lucy, Mexican organizations are saying that about four weeks from now the US will see much more volume coming in, California and Peru will be done by then. “Mexico should really crank it up to at least 40 million pounds a week to get this thing back to more normal price per box.”
Field negotiations weighted to one side
The packing houses where Del Rey Avocados sources its fruit from are having to pay up front for fruit. “ They have to literally pay cash – they have to give the farmer a guarantee,” Lucy says, to agree to paying X Pesos per kilo. “The packer down in Mexico is at risk and we’re at risk too to make sure that we can (get the) product into the US and sell it at a profit. Lucy says lowered field quotes could come about as more growers are anxious to get started. The price scale should slide from as high as $80 in some cases, down to $40 as October 1 approaches.
Some blooming stages had lower crops
Mexico has four blooms. The early and second blooms were light. The next one (‘normale’) is expected to be huge crop but people will be waiting until mid October before seeing those. “We’re going to see relief in September but you’re not going to see major relief on volume until we get into late October through to December.”
For more information:
Bob Lucy
Del Rey Avocado
Ph: (760) 728-8325