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Made with Flourish

Mexican avocado exports to the U.S. will remain strong in 2018-19, according to a new report from the U.S. Department of Agriculture.

Mexican hass avocado production is forecast at 1.9 million metric tons or more for marketing year 2018-19, according to the USDA’s Foreign Agricultural Service annual report on Mexican avocados.

By way of comparison, production estimates for the 2017-18 season are about 2 million metric tons, according to industry estimates.

“Overall production is expected to be good as weather conditions have been optimal thus far,” the report said. “Sources indicate that the implementation of phytosanitary pest-control programs has helped boost production.”

Mexico’s Michoacán region is the world leader in avocado production and accounts for 80% of total Mexican avocado supplies.

Total area planted for Mexican avocados for 2017-18 is at nearly 571,000 acres, up a little more than 5% from about 540,000 acres in 2016-17. 

Export outlook

Mexico’s avocado exports for 2018-19 are forecast to be close to 1 million metric tons, according to the report. That’s similar to 2017-18, according to the USDA report.

Exports have been increasing over the past few years, and the depreciation of the peso against the dollar has helped international sales in general, according to the USDA report.

The USDA report said the U.S. is the top export market for Mexico, consuming between 74% and 79% of total Mexican exports. About  6% of exports are sent to Japan and 7% to Canada.

About forty-five packers in Michoacán are eligible to export avocados to the U.S., according to the report, while other producing states have concentrated on exporting to Japan, Canada, France and Spain.

While Mexican hass exports to the U.S. have increased with year-round access to all 50 states, the USDA report said exports to Canada, Japan and Europe have also risen.

 

Market tone

Avocado prices for marketing year 2018-19 for size 48s in the U.S., f.o.b. Los Angeles, Calif., started in July at about $42 a carton, according to the USDA. By September, prices reached as high as $72 per carton, though by mid- October prices dropped to around $26 per carton.

The USDA report said a price dispute between producers in Michoacán and packing companies caused growers to cease harvesting activities Oct. 29 for approximately two weeks.

The report said an agreement was reached to end the strike on Nov. 14,when the parties along with the Mexican government agreed to have public reports of market information including:

  • Product exported;
  • Product sent to domestic market;
  • Volumes sold; and 
  • Destination 

Growers in Michoacán generally sell their fruit on the spot to a packer in terms of pesos per kilo.

“The intention is to have transparent commercial value information of the avocado trade,” the USDA report said. “Parties agreed that market prices will be adjusted according to the supply/demand principle.”

Mexican producers said the strike caused a deficit of 38,000 metric tons in the U.S. market, but that resumption of packing was expected to erase that shortage within a few weeks,  according to the USDA report.

 

 
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