As we previously reported here, the U.S. is considering importing avocados from Colombia. The Andean nation’s National Plant Protection Organization (NPPO), has officially requested that its avocados be authorized for import, and the U.S. Department of Agriculture (USDA) is currently weighing the proposal.
While the agency notes the need for rigorous pest-control protocols before granting authorization, it acknowledges that the guacamole-crazed country cannot meet demand internally. “The increase in demand over the past decade has contributed to domestic producers being able to maintain production levels, despite the large increase in avocado imports,” stated the agency in its proposal to change the regulation.
The price of avocados has surged over the past month in the United States because of a supply shortage. This is largely due to a growers’ strike in Mexico, which produces the bulk of avocados eaten north of the border. Low harvest yields in California have exacerbated the problem.
The strike has ended, and imports into the United States spiked all the way to 50 million pounds in the last week for which data is available. But the damage has already been done to the market supply that may not recover until next year. “We’re not going to have any avocados for anybody for maybe a week and a half,” Cythnia Guzman of California-based distributor Nature’s Produce, told CNBC last week. “We’re seeing fruit out there at double the price it normally would be.”
The industry tried to address the shortage by increasing imports from Chile, which upped its supply from one million pounds to three million during the month when Mexican producers went on strike. But this wasn’t even enough to offset the drop in California production (which fell from three million pounds to under 2,000 pounds amid a weak harvest).
The Dominican Republic and New Zealand also ship low quantities of Hass acovados to the United States. Peru became a low-volume importer after winning approval in 2010 as well. But outside of Mexico and California, only Chile adds a significant volume to an increasingly voracious avocado-eating market.
The APHIS acknowledges that added competition from Colombian producers could negatively impact farmers in California. Their loss could be as high as $6 million USD, depending upon the added import volume. But the overall effect would be positive for the country, as a larger supply would help the wallets of consumers, albeit only with a price drop of about 2%. “Consumer welfare gains outweigh producer welfare losses,” said the agency.
More than price, however, the biggest benefit would come from receiving another supply point. At the current rate of demand increase, Mexico and California likely cannot keep up. Nearly 2.2 billion pounds of Hass avocados were shipped in the country last year — almost double the 1.1 billion in 2011, per the Hass Avocado Board.
Colombia is an obvious candidate to help fill global demand. Avocados are ubiquitous throughout the tropical nation of nearly 50 million people, and many believe its agribusiness sector is set for a boom.
If the red tape from U.S. regulators can be cleared, so that Colombian farmers can start exporting to the world’s largest market, production in the country could skyrocket. And if a larger Colombian crop can also help keep prices down for guacamole lovers in New York and Los Angeles, everyone in both nations — with perhaps the exception of growers in California — will be happy to see Colombia share its delicious avocados with the rest of the world.
