U.S. Tree Fruit Outlook USDA - Avocados

U.S. Tree Fruit Outlook USDA - Avocados


In the growing U.S. fresh fruit market, domestic per capita consumption of avocados increased an average 10 percent annually over the past 10 marketing seasons (1999/2000-2008/09), the second-fastest growth rate after blueberries.Only in two of those past 10 seasons did domestic per capita avocado consumption decline—in 2002/03 when domestic production declined 20 percent and in 2007/08 when sharply higher export shipments competed with domestic shipments for
available supplies (table 13). Domestic avocado production in 2008/09 declined to
its lowest level since 1979/80, yet per capita consumption rose to a record 3.8
pounds per person, mainly with imports of Mexican avocados driving the supply
growth. Consumption will likely continue to grow in 2009/10 as anticipated
production increases in all three of the United States’ major sources for avocados—
California, Mexico, and Chile—is projected to boost domestic supplies up to a
record 1.2 billion pounds. Even with a strong export market, this level of supplies
should be sufficient to meet the demand growth in the domestic market. ERS is
projecting 2009/10 consumption to reach the 4.0 pounds per person mark,
surpassing the record high last season by 7 percent.
Based on a crop projection estimate from the California Avocado Commission,
avocado production in California for the 2009/10 marketing season is expected to
more than double the very small crop size in 2008/09, and be the largest crop since
1992/93. About 90 percent of U.S. avocado production is from California and
therefore the expected rebound in their production will be reflected in the overall
U.S. avocado crop. ERS projects 2009/10 U.S. avocado production to increase
from 232 million pounds last season to a 5-year high of around 473 million pounds.
California avocado groves showed very little wind damage and pest problems this
growing season, signaling potential for a very good quality crop. However, fruit
were slow to size, especially those in the southern growing region, forcing a
delayed start to this season’s shipments. Normally, fruit from southern California
groves start showing up in the market around late January or February. For this
season, California avocado supplies began to increase to promotable levels in
March, thanks to the heavy rains in January and February which aided in the
sizing of fruit.
Although California and Florida shipments were down early this winter, increased
imports from Mexico and Chile provided sufficient volume for retailers during
those months, keeping prices to consumers down from the same time last year,
according to AMS data. January-February Hass avocado retail prices averaged
$1.02 each, from $1.14 the same time last year. While Chile’s shipping season has
finished, continued increased volume expected from California and Mexico through
the spring and summer will continue to put downward pressure on prices relative to
last year in the coming months. California’s northern growing region, typically
shipping avocados beginning around May or June, reportedly had a lot of fruit on
trees, so growers were forced to harvest some early to prevent an oversupply in the
spring and early summer and also to help the remaining fruit gain size. Achieving
both these situations would keep prices from slipping further in the coming months.
Meanwhile, Florida avocado shipments have wound down for the season, with
supplies down 17 percent from a year ago, based on AMS data.
The expected big 2009/10 crop in California should mean there will be increased
availability for the export market. There are at least 40 countries around the world
that serve as export markets for U.S. avocados. Canada receives the bulk of the
volume and South Korea is also an important market. U.S. avocados continue to
face growing competition in their key export markets, especially with major
producers—Mexico and Chile. Over the last 10 years, U.S. exports ranged from 3 to 6 million pounds (or around 1 to 2 percent of production) except in 2005/06
when exports were 14.5 million pounds and in 2007/08 at 13.5 million pounds.
Exports were much higher during both those marketing seasons than other seasons
over the past decade, but volumes still do not match up to high levels achieved
during the mid-1980s through mid-1990s when exports averaged around 25 million
pounds annually.
Chile’s avocado crop for this season benefited from improved crop-growing
weather with production rebounding from a sharply smaller crop last season due to
a freeze. The Chilean avocado industry was mostly unharmed by the strong
earthquake that shook the country on February 27. Shipments were winding down
for the season when the earthquake occurred and most export-bound supplies had
already left the country. AMS data indicate Chilean weekly shipments to the
United States slowed by almost 40 percent in late February through the first week of
March from the average weekly shipments during the first three weeks in February.
In addition to seasonal declines, the drop in shipments reflects the slow movement
of Chilean products, in general, as the country assessed earthquake damage to all
sectors of its economy. Relative to last season, however, the earthquake did not
prevent Chile’s avocado industry from shipping much higher volumes to the United
States late in the season.
In Mexico, a combination of favorable weather during the growing season and
continued implementation of phytosanitary programs to control pests led to
increased production potential for their avocado crop, with 2009/10 total production
forecast to increase to a record 1.18 million metric tons, up almost 6 percent from
the previous season, according to USDA’s Foreign Agricultural Service (FAS).

Mexico’s domestic market consumes most of that country’s avocado production,
but growing international demand for their Hass avocados, particularly from the
United States, (Mexico’s main export market), as well as from other important
markets such as Japan, Canada, France, and El Salvador, and potential markets like
China, has influenced increased plantings in recent years. Hence, avocado
production in Mexico is expected to continue to trend upward in the next few years
as these recent plantings come into bearing. Exports from Mexico for 2009/10 are
forecast to remain about unchanged from 2008/09, but volumes going to the U.S.
market are projected to increase by 10 percent.