‘Balance needed’ in avo sector after ‘season of discontent’

It has been a “season of discontent” in the global avocado sector, according to Paul Devlin of Halls, with high supply, low prices and variable quality making life difficult for producers and suppliers.

At certain points this year growers have been forced to sell fruit at just €6 per 4kg box, which is below the €7-10 per box that Devlin estimates most producers need to make supply economically viable.

Devlin, who is the MD for Halls in Europe, said it had been a “challenging” summer campaign for European avocado suppliers. Weather issues in both Africa and Peru – due to the effects Cyclone Yaku and El Niño – affected fruit quality and limited volumes following high crop estimates.

Speaking to FPJ at Fruit Attraction in Madrid, he said there was now an “unforgiving” market for inferior-quality avocados in Europe, with exporters struggling to find alternative outlets for lower-quality fruit at a sustainable price.

Despite an absence of official statistics, Devlin estimated that there have been high levels of unsold or wasted avocados this year.

“We want to continue to grow the category, but we have to be careful about fruit quality and remember we need to give the end consumer good quality if we want them to continue buying avocados,” he said.

“We need sustainable growth, not just growth for growth’s sake. Growers globally will probably have felt the pinch this summer because the price points for many may not even be covering the costs of production, shipping and so on.”

According to Devlin, the avocado industry is now in a “transitional period’ following years for production and sales growth.

Supply and demand in Europe are now more or less “in sync”, he said. But he warned that in future seasons, supply could easily outstrip demand if the sector doesn’t focus on fruit quality, continue with campaigns to boost European consumption, and scale back supply in certain windows.

“A lot of people in the industry will reflect on this summer,” Devlin concluded. “From a production point of view, growers will have to look at their yields and decide how many tonnes per hectare of quality avocado they can actually produce.

“Some producers are already scaling back their plantings and I think that will continue to happen. The scaling back of plantings, along with climate change, is causing certain investors to re-evaluate their involvement in the sector.

“But I think the cutting back of plantings will help in the longer term. Production needs to slow down a bit so that the scales don’t tip in the wrong direction.”

Devlin predicted possible consolidation in the global avocado sector in the next few years due to the economic challenges faced by the industry, but he stressed the enduring appeal of the avocados due to their health benefits and versatility.