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Avocado market stabilizes after lockdowns

Avocados like these from Mexico will be part of the FDA’s VQIP at Costco, which certifies food exporters.

The avocado market has reached stability as summer begins. Supplies are growing from California, which is having a strong rebound year from last year, and Mexican exports are doing their best to meet demand but not exceed it.

That has led to steady pricing as spring turned to summer.

VOLUME OF CONVENTIONAL AVOCADO FROM MARCH 16TH THROUGH JUNE 21ST 2020

Even though volume in 2020 has increased more than 40 percent over 2019, the numbers are still behind the volume sold in 2018 in the same period of mid-March to mid-June. That year 2018, was the highest volume sold in the spring in the last five years, and 2019 was the lowest. So, 2020 is in the average range even with the pandemic effect for the same time frame, which is not bad for a contracted market due to the health crisis, said Raul Lopez, an agronomist with Agtools Inc.

Blue Book has teamed with Agtools Inc., the data analytic service for the produce industry, to look at a handful of crops and how they’re adjusting in the market during the pandemic.

WEEKLY MOVEMENT OF MAIN REGIONS, VOLUME FROM MARCH 16TH TROUGH JUNE 21ST

The Mexican season is slowing down as the California season is growing every week. As the summer continues, we will see this number increasing, Lopez said. The total volume is in a downhill trend, but it’s related to a seasonal effect, and has nothing to do with the pandemic.

F.O.B. PRICE IN Mc ALLEN, TX MEXICAN CONVENTIONAL AVOCADOS SIZE 48´S

Besides the volume representing a good market movement, the F.O.B. price has had a good level all spring, Lopez said. The price for conventional avocados size 48´s from Mexico has been steady at $40 dollars per case since a mid-March spike related to pandemic lockdowns.

NEW YORK TERMINAL MARKET PRICE FOR CONVENTIONAL MEXICO AVOCADOS SIZE 48´S

The price in the New York market has had some volatility during March and early April, Lopez said. In the last four weeks the range of movement has reduced around $40. This price is far lower than 2019 but higher than 2018.

VOLUME REPORT BY REGION AND COMPARISION VS PREVIOUS YEAR.

Reviewing the numbers from March 16h through June 21st of 2020, with a total market volume of 683 million pounds of conventional avocados after the beginning of the health crisis, the avocado market has shown a 41 percent increase over last year in the same period, Lopez said.

Mexico holds 74 percent of the volume sold. However, the California season started a few weeks ago and has been increasing every week on a constant basis, and now has 22 percent of the market share and will keep growing over the summer. These two regions have both shown growth over the same period of last year.

Greg Johnson is Director of Media Development for Blue Book Services