Despite water availability challenges in some producing countries, avocado production and trade will continue to grow, according to a new RaboResearch report from Rabobank.
The report said Latin America is the top exporter, while the U.S. continues to be the primary importer.
Competition and margin pressures, especially in South America, are likely to move the market toward consolidation, the report said.
Setting records
Global avocado exports are expected to surpass 3 million metric tons by 2025, the report said, with Latin America at the forefront.
Mexico, Peru and Colombia will be the largest avocado exporters, according to Rabobank projections, while Brazil, Ecuador and other countries are emerging as global suppliers.
Demand growth in the European avocado market has spurred increased production in the European Union, mainly in Spain, the report said. However, water availability will limit large-scale expansion of avocado production, and further area expansion is not expected for European production, according to the report.
Africa is witnessing steady growth, notably in Kenya and Morocco.
U.S. demand for avocados continues to climb, with 2023 imports at a record 1.26 million metric tons, up 11% from 2022.
Mexico commands a 90% share of U.S. avocado imports.
Europe’s demand for avocados is predicted to grow, though its reliance on imports will expand in the years ahead, the report said. Demand also is rising in other regions.
“Opportunities abound in Asia and Latin America, with untapped markets poised for growth. South American countries, in particular, are ripe for increased consumption, pending promotional and marketing initiatives,” David Magaña, senior Rabobank analyst for fresh produce, said in the report.
Asia’s imports have surged by 29% in 2023, led by China.
While the hass variety now dominates global trade, Magaña said other avocado varieties will likely grow.
“While hass avocados will continue to dominate, hass-like varieties will gradually gain ground, particularly those with higher yield potential,” Magaña said in the report. “The industry faces price pressures as global production volumes rise, with quality and size being pivotal in the American and European markets.”
