World Avocado Market Projection for 2030 - A Paradigm Shift

Summary

In a webinar hosted by the Hass Avocado Board, Eric Amber, a researcher and publisher of Fruit Top magazine, presents an updated projection of the avocado world market up to 2030. Amber's analysis reveals a rapidly expanding market, with production outpacing demand, particularly highlighting growth in Latin America and the Mediterranean. He discusses the potential for increased consumption in the US and Europe and emphasizes the need for strategic promotion to unlock the vast opportunities in emerging markets. The presentation underscores the importance of sustainable practices and competitive pricing in the face of a predicted oversupply.

Takeaways

• 📈 The avocado market has seen rapid growth over the past decade, with an average growth rate of 10% per year, making it a significant player in the global fruit trade.
• 🌍 Latin America is the largest exporting region for avocados, accounting for over 80% of global exports, with Mexico being the leading exporter.
• 📊 The European market is more diversified compared to the U.S. market, which is heavily reliant on Mexican imports, while Europe has multiple suppliers.
• 📉 Despite an increase in volume, the avocado market has experienced a decrease in turnover from the 2021 season to the 2022-2023 season, indicating market pressures.
• 📚 Eric Amber's research and presentation provide a comprehensive analysis of the avocado market, including updated data and projections up to 2030.
• 🌳 There has been a significant increase in avocado orchard plantings, with an estimated 175,000 hectares gained in six years, tripling the rate of the previous period.
• 📊 The demand for avocados is growing, but not as quickly as supply. This discrepancy suggests a potential oversupply issue in the coming years.
• 🌱 New plantings and increased productivity are expected to lead to a substantial increase in avocado exports, outpacing demand growth.
• 💡 There is a significant opportunity for growth in the avocado market, particularly in regions like Europe and Asia, where consumption levels are currently low.
• ♻️ Sustainability and consumer expectations will become increasingly important, potentially impacting the market through regulations on carbon and water footprints.
• 🌐 The presentation highlights the need for continued investment in promotion and the development of new markets to balance the growing supply of avocados.

Q & A

Who is Eric Amber and what is his professional background?

Eric Amber is a researcher at CIRAD and also the publisher of Fruit Top magazine. He has an agronomy and food processing engineering background. He worked for 10 years at a large French importing company specializing in food business before switching to CIRAD, where he has been in charge of a department specializing in international fruit trade for the past 20 years.

What is the current position of avocado in the international food trade in terms of volume and value?

In 2021, avocado ranked eighth in volume with 2.5 million tons, accounting for 4% of the international food trade, which is estimated at 70 million tons. In terms of value, avocado holds the fourth position with a turnover of 6.6 billion US dollars in 2020, representing 8% of the world trade.

What was the growth rate of the avocado market in the last decade?

Over the last decade, the avocado market has seen a dramatic change with an increase in trading volume. The base growth rate was around 160,000 tons per year, which is about three times the growth rate from the previous period, resulting in a market expansion by a factor of 2.6.

Which countries are the major exporters of avocados?

Mexico is the leading exporter of avocados, accounting for 60% of the total volume, followed by Chile, Israel, Colombia, and Kenya. Other significant exporters include Spain, South Africa, the Dominican Republic, and Morocco.

How has the avocado export volume evolved in recent years for countries like Michoacan, Peru, Israel, and Colombia?

There has been a significant increase in avocado export volumes for countries like Michoacan and Peru, with an increase of around 300,000 tons in just four years. Israel and Colombia have seen an increase of about 70,000 tons, and Jalisco and Kenya have seen an increase of around 40,000 tons.

What is the distribution of avocado exports among the leading markets?

Approximately half of the world's avocado exports go to the US, and one third go to the European Union and the UK. This means that the remaining 20% of the world trade is absorbed by the rest of the world's population.

What are the challenges faced by the avocado market in Europe?

The European market faces challenges such as a decrease in prices due to an increase in supply, especially during the summer avocado season. Additionally, there is a need for increased promotion and investment to build consumption in the region.

What is the current state of the avocado market in Asia?

The Asian market has been slow to adopt avocado consumption, with only 5% of the trade, or 140,000 tons of imports in 2021-2022. However, there is potential for growth due to the large population with good to high income in countries like Japan and China.

What are the key factors that could impact the future growth of avocado demand?

Factors that could impact future growth include a decrease in plantation rhythm, increased promotion and investment in consumption, addressing climate change and sustainability concerns, and meeting consumer expectations for local food and product image.

What is the projected growth rate for avocado production and demand according to Eric Amber's model?

The model projects a significant risk of oversupply, with production increasing much faster than demand. The peak period during season 2023 to 2025 is expected to have a production that corresponds to twice the demand, with a progressive decrease from 2026 but still remaining heavy until 2028.

What actions are suggested to address the risk of oversupply in the avocado market?

Suggested actions include decreasing the plantation rhythm, adjusting costs, reinforcing sustainability, investing in promotion, and exploring new markets to build consumption, especially in regions with high potential for growth.