Large California avocado crop overflows into import deals - The Packer

Large California avocado crop overflows into import deals

08/10/2012 11:42:00 AM
Jim Offner

Look for California’s avocado crop to spill into the first couple months of Mexico’s new fall crop and force a delay in Chilean shipments, shippers and marketing agents say.

It will be a sharp contrast to last year, when California and Mexico had short crops, suppliers note.

Though not a record, this year’s California crop will come in at about 392 million pounds, compared to about 250 million in 2011, according to the California Avocado Commission.

As a result, California should be supplying retailers and foodservice customers into November.

“It’s a good-sized crop that will still be in the market in good volume for awhile,” said Rob Wedin, vice president of sales and marketing with Santa Paula, Calif.-based Calavo Growers Inc.

Mexico, which shipped an estimated 750 million pounds in 2011-12, projects a volume of about 825 million pounds during the current season, which got under way in late July.

Higher volume is reflected in prices that were starkly lower in late July than they had been as the same point in 2011.

On Aug. 7, two-layer cartons of hass avocados from California were $24.25-25.25 for size 32s; $24.25-26.25 for 36s; $26.25-28.25 for 40s; $27.25-28.25 for 48s; $27.25-30.25 for 60s; $25.25-27.25 for 70s; and $19.25-22.25 for 84s.

A year earlier, two-layer cartons of hass avocados from the Southern District of California were $46.25-48.25 for 32s and 36s; $50.25-51.25 for 40s; $50.25-52.25 for 48s; $49.25-51.25 for 60s; $47.25-49.25 for 70s; and $40.25-42.25 for 84s.

Jan DeLyserDeLyser“If we look at this calendar year we’re in now, we’re going to do 1.4 billion pounds in the U.S., which is a 21% increase from 2011,” said Jan DeLyser, vice president of marketing with the Irvine-based California Avocado Commission.

Supplies were off by 10% a year ago as a result of a medium-sized Mexican crop and a small California crop, DeLyser said.

Not so, this year, she said.

In fact, she said, the reverse applies.

“Now, supplies are increasing and it’s safe to say we’re going to get a 10% increase on that 1.4 billion, so we’re going to come in with something like 1.55 billion pounds as an industry,” she said.

That’s not too much, she said.

“It’s not a huge problem, but there are some growing pains, no doubt.”

Wedin said the U.S. industry was moving more than 30 pounds a week in late July.

“That’s substantial,” he said.

Shipments should settle into the “high 20 millions” during the fall season, in the fourth quarter, Wedin said.

“That’s consistent with Peru being done, California finishing in November and Mexico carrying part of the weight,” he said.

Chile will hold off on shipping accordingly, as the U.S. market cools down, shippers predict.

“Chile will probably be delayed just because of the abundance of fruit. They don’t need to come in and compete with all these supplies,” said Ross Wileman, vice president of sales & marketing for Oxnard, Calif.-based Mission Produce Inc.

What does that mean for marketers?

“It’s an opportunity to help our best customers see the new profit potential in pushing a really popular product,” Wedin said.

Giovanni Cavaletto, vice president of operations with Bloomington, Calif.-based Index Fresh Inc., noted the contrast between the fall markets of 2011 and 2012.

“Last year, for all intents, California was done by Sept. 10. This year, we’re going to go through probably Nov. 10 or later with good supplies of a high-quality, high-oil-content crop out of California,” he said.

That Chile has to wait a bit to start its shipments to the U.S. — in early October, more than likely — will have at least one advantage to end-users, said Phil Henry, chief executive officer of Escondido, Calif.-based Henry Avocado Corp.

“I think it’s good for consumers, because it means they’re harvesting when the fruit has a higher oil content,” Henry said.

For California, it’s a bit more time to promote good volumes, DeLyser said.

“We’re going to extend the momentum that we’ve built over the summer,” she said.



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