With the end of the Mediterranean avocado season, notably Moroccan and Spanish, it's now the turn of summer origins to supply the European market. According to Paul Kyalo, CEO of Konza Tropicals, Kenyan origin is well-positioned on the market but suffers from logistical difficulties that hamper its export potential this season.
Kyalo says, "We are currently transitioning into the European market as Mediterranean and winter Origins clear the way to summer origins. As is typical during this seasonal shift, we have observed a surge in both market prices and demand for Kenyan avocados. However, despite the rising prices, Kenyan avocado exporters have not seen a proportional advantage due to several challenges."
The exporter describes a complicated campaign in terms of logistics: "We're still living with the crisis in the Red Sea. As everyone knows, due to security concerns in the Red Sea, most sea freight is now rerouted around the Cape of Good Hope. This has extended shipping durations to key European markets to over 32 days. While airfreight is an alternative, it presents its own set of challenges. Several European retailers have publicly committed to reducing their carbon footprint and have moved away from sourcing airfreighted fresh produce. Additionally, airfreight rates out of Kenya have surged, driven by increased demand for flower, herb, and vegetable exports. This has made it difficult for avocado exporters to secure space, and ultimately, airfreighted avocados have faced difficulties in achieving competitive delivered prices in Europe," Kyalo continues.
As a result, Kenyan avocado exports to Europe are down in volume terms, but this situation is offering fertile ground for growth in the processing industry. Kyalo explains, "We are witnessing a marked decline in export volumes to Europe, with some exporters choosing to temporarily suspend shipments until there is greater clarity or a substantial improvement in the logistics situation. In response, Kenya's avocado industry has continued to diversify through value addition, particularly in processing. Over the past year alone, at least ten new avocado oil extraction facilities have been established, and so far, we have close to thirty avocado oil processors in the country. This shift has led to a growing share of fruit being channeled into crude avocado oil production, offering a buffer against the unpredictability of fresh export markets."
Longer transit times expose Kenyan exporters to fiercer competition. Kyalo reports, "Fruit harvested and shipped from Kenya in mid-March will only arrive in Europe towards the end of April, coinciding with the arrival of early-season fruit from Peru, South Africa, and other summer origins. This overlap is likely to exert downward pressure on market prices and may reduce demand for late-arriving Kenyan fruit. Additionally, we are observing a prolonged harvesting window from Morocco and Spain, which has extended the availability of fruit from these Mediterranean origins longer into the transition period than usual. This convergence of supply is creating increased competition in the European market."
The exporter remains, nevertheless, confident: "Despite this, Kenya remains well-positioned, particularly in the early part of the season. Kenyan avocados have this season an excellent internal quality, higher dry matter content, and a favorable proportion of large to medium calibers—attributes that European buyers greatly value. These characteristics are especially prominent at the onset of the season when the fruit is harvested from well-managed orchards in optimal climatic zones. Moreover, buyers across Europe consistently prioritize fruit that is fully certified. When this is combined with good post-harvest handling and traceability, Kenyan avocados can command a fair and competitive price, even in a crowded market."
"We remain cautiously optimistic. With international focus on resolving the Red Sea crisis and rising global demand for both fresh and processed avocado products, we anticipate a gradual stabilization of the market in the months ahead," he concludes.
For more information:
Paul Kyalo
Konza Tropicals Limited
Tel: +254 711 214 869
Email: [email protected]
www.konzatropicals.com