The avocado production has grown significantly over the last five years and is expected to continue growing in the coming years, although a slowdown is already being observed, according to Zac Bard, CEO of the World Avocado Organization, WAO.
"This has been a response to the growth in the global avocado markets, production shortages and rising demand. COVID took a toll on the global economy and we saw a slowdown in the markets due to blockades, supply chain disruptions and all the complications that followed," he said.
"Over the next three to four years, production increases are still expected in young orchards, but we are already seeing a slowdown in new plantings that will affect the production increases four years from now."
The avocado supply and demand are increasingly balanced and the weather is having a greater impact than expected
Taking the past six years into account, future prospects point to a more balanced market in terms of avocado supply and demand, according to Zac Bard.
"Although on paper there are concerns about future production increases, in reality, climate change is likely to have a greater impact than anticipated. This may lead to the production falling below the theoretical forecasts. A current example of this is Peru's forecast for 2023. The country expected to see a 15% increase compared to 2022, but has adjusted the forecast to a 5% increase simply because of the climate. We are moving from La Niña to El Niño, and this weather phenomenon affects almost all avocado growing areas globally."
"It is an interesting time for us, as a relatively new industry. In many parts of the world, they haven't gone through this before. As growers, we know that it is taking longer than expected for productions to reach their full potential, so we expect a reduction in the anticipated volume increases. On a more positive note, there is plenty of room for consumption growth in new markets," he says.
"As with any agricultural crop, the exceptional year we are having could result in lower prices, but at the same time, this will allow avocados to reach all corners and be purchased by more consumers. The positive side of this is that the demand increases."
Lastly, it should be mentioned that Asia accounts for almost two-thirds of the world's population, so increases in avocado consumption can be a big game changer for the future. My personal prediction is that, with promotions, Asia could become a mass market. So far, early signs for this year show very positive growth in Asia, and there's more to come. Also, there is already avocado production in many parts of Asia, and we know this will help increase consumption in those markets, as it did in Mexico, Chile and Israel," says Zac Bard.
While the popularity of avocados has grown a lot over the last ten years, how necessary is it to promote their consumption?
"Anyone with any doubts about the benefit of promotions need only look at the success achieved in the U.S., the largest avocado market in the world. There is no doubt that this would not have happened without the great promotions launched there. In our opinion, there is no room for discussion in this regard. Avocados, especially in Europe, are still a relatively new crop, with low penetration rates. This also determines the need for promotions. The same is true for Asia, which is the new frontier for avocados," said the WAO CEO.
"Consumption in Europe is still in the early stages of development, while Asia is in the embryonic stage"
"Mexico has a per capita consumption of over 10 kg, while Israel and Chile have consumption rates of around 8 kg, so it makes sense to say that markets in Europe are still in the early stages of development, while Asian markets are even further behind, in the embryonic stages," said Zac Bard.
"The shift toward plant-based diets and people wanting to eat healthier foods means the time is right for avocados. It is our responsibility to facilitate the development of this market. We expect to see continued growth in the EU market, as we already have in the past, and this also applies to Eastern Europe. In China, since the end of strict lockdowns, we are already seeing healthy growth. In India, we are seeing growth thanks to market access from geographically well-located origins. The WAO has already started launching promotions in India and has future plans to do the same in other new markets to unlock this potential," he says.
Boosting health benefits and debunking myths as a strategy to promote avocados
"We focus on the health benefits and the most positive aspects of avocados. We are also debunking environmental myths," says Zac Bard. "In new markets like India, where we just launched a promotion, we are focusing on bringing avocados into Indian cuisine and focusing on the cultural events of the year. Hopefully, someday, avocados will be consumed at cricket matches or while watching cricket on TV."
"Another point worth highlighting is that the countries that grow avocados have the potential to develop a large domestic consumption. So we expect other producing countries to join the list of big consumers," he says.
"We believe the biggest threat to the avocado industry has been the spread of myths, such as avocados being bad for the environment. Such negative articles have been appearing since late 2017 and we originally believed they would eventually go away, as they are unsubstantiated and not based on fact. However, instead of going away, things have gotten worse, to a point where the WAO decided to address them with a myth-busting campaign launched in 2022."
"We believe we've made a lot of progress in less than a year, but we still have work to do to keep it that way. Consumers believing the myths that avocados are bad for the environment would have been a serious threat. Fortunately, the creation of the WAO and the strong support of its members have allowed us to start nipping this in the bud before it became more critical. Avocados provide us with a wonderful story to tell, and we are doing so with pride," said the WAO's CEO.
For more information:
World Avocado Organization
717 D Street, NW Suit 310
Washington, DC 20004
[email protected]
avocadofruitoflife.com/es/
