Strong demand meets big crop - The Packer

Strong demand meets big crop

07/07/2014 12:14:00 PM
Andy Nelson

Demand is up for much larger volumes of Peruvian avocados, importers say.

Peruvian shippers expect to send 130 million to 150 million pounds of Peruvian avocados to the U.S. this summer, a huge increase over last season, said Xavier Equihua, CEO of the Washington, D.C.-based Peruvian Avocado Commission.

But based on soaring demand, this year’s total should look small relatively soon from now, Equihua said.

Peruvian Avocado CommissionEstimates have the Peruvian avocado supply tripling this season, which has importers and the Peruvian Avocado Commission working hard to find new customers. Increased demand in the U.S. and the high quality and good sizing of the Peruvian fruit have importers optimistic of moving the extra volume.“In three or four years, the supply will be 200 million to 250 million pounds, easily,” he said. “It took Mexico six or seven years to establish itself. It took Peru just a couple of years.”

Peru should continue to add significantly more volume every year regardless of how much California ships year-to-year, Equihua said.

With California product staying in the West, Peru can rely on ever-growing Eastern markets to keep its growth robust.

“There’s more summer demand, and the East and other parts of the U.S. are becoming larger markets,” Equihua said. “This market is going to grow and grow.”

Peru is the biggest avocado shipper to Europe, Equihua said, but the European markets are mature ones. The commission is betting big on the U.S. for future category growth.

“We can’t oversaturate Europe,” he said. “I wouldn’t be surprised if in 10 years, Europe is at the same level as it is now. The market that needs more is the U.S.”

The commission is doing a great job of beefing up its marketing this summer, said Bob Lucy, partner in Del Rey Avocado Co. Inc., Fallbrook, Calif., but when a crop triples in size in a single season, there’s a lot of work to do.

“It’s been much more challenging,” he said. “There’s been good acceptance, but you have to find new customers. Peruvian fruit has to earn its stripes every day.”

Fortunately, the quality of this year’s crop should help spur demand, Lucy said.

“The fruit doesn’t lie — it’s eating very well.”

One challenge for shippers is getting buyers to accept Peru’s larger size profile, which can often peak on 32s and 36s, Lucy said.

“There are more 32s and 36s than the U.S. market can absorb, and finding customers to take them is a challenge.”

Often, Del Rey and other shippers have to adjust the price of big Peruvian fruit in order to get retailers to take it.

Foodservice, fortunately for them, can be more open to larger avocados.

“In many cases, it doesn’t matter to foodservice if it’s a 32 or a 48,” Lucy said.

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