The US wants to impose a 25% tariff on this fruit

Mexico: Avocado prices increase due to a possible tariff hike

Avocado, one of the most consumed products in the United States, has become the new focus of unrest for Mexican producers after president Trump announced he wants to tax imports of this product by up to 25%.

The immediate consequences of this announcement have been observed in the price of avocado. An indicator of the Hass variety from Michoacan, the heart of Mexican production of this fruit, rose by 3.7% on Monday to its highest level since August 2017. Unchanged last week, the benchmark index has rebounded by 65% this year. Other prices followed by AvoPrice changed slightly on Monday.

The last time that Trump threatened Mexico about immigration, warning he would close the border in April, the Michoacan avocado indicator skyrocketed.

Avocados are not traded on stock exchanges, and like in other relatively opaque fruit and vegetable markets, prices begin with producers. A tough season has reduced the supply and raised prices, according to a survey conducted on Friday by half a dozen vendors in the crowded wholesale market of Mexico City. In addition, US avocado production has decreased considerably this year.

The producers from Michoacan are not expected to lower their prices to offset the tariffs. This means that the American consumers would pay the taxes.

 

Source: latercera.com


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