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‘Avo-lanche’ of avocados: consumption and exports need to rise
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‘Avo-lanche’ of avocados: consumption and exports need to rise
Australia will need to both consume and export more avocados as the nation’s growers navigate a period of soaring production growth over the coming five years, specialist agribusiness bank Rabobank says in a new report. This year alone, ‘per capita (person) supply’ of avocados is estimated to be up 26% on the previous 12 months to 4.8 kilogram – equating to 22 avocados per Australian. In ‘The ‘Avolanche’ of Australian Avocados’ report, the bank’s outlook for the avocado industry, Rabobank says a significant maturing of avocado trees in the past season – primarily in Western Australia and Queensland – has resulted in a bumper crop, causing a national oversupply and seeing retail prices fall to a record low of $1 each in June 2021 and again early in July 2022. Retail prices for 2022 remain tracking at 47% below the five-year average. While the low prices have been welcomed by consumers currently facing significant price rises for many other food items and household staples, they have put considerable pressure on grower margins, already squeezed by increasing input costs and labour shortages, according to the report’s author RaboResearch associate analyst, Pia Piggott. “A bumper 2021/22 crop in Western Australia was a turning point,” Ms Piggott said, “with industry estimates of avocado production in the state being up a staggering 265% on the previous year. This was driven by a 21% increase in the hectares of avocado trees in WA that reached maturity and produced fruit in this season, coupled with optimal growing conditions in the state.” Overall, Australia’s avocado production for 2021/22 is estimated at 124,000 tonnes. Coupled with estimated imports of 12,500 tonnes for the year, this has meant abundant supplies for consumers, Ms Piggott said. The past year’s market oversupply in Australia was “just the beginning”, the report says, with industry forecasts that domestic avocado production will expand by 40% (or 50,000 tonnes) in the next five years, reaching 173,000 tonnes in 2026. Regaining balance in Australia’s avocado market requires both “increased domestic demand and larger export volumes”, Ms Piggott says. In 2021/22, the average volume of avocados consumed by each Australian household increased 31.2% on the previous year, the report says. This is despite households spending 29.1% less on avocados, due to lower prices. However, increasing consumption of avocados in Australia will not be enough to use up the ‘avo-lanche’ of additional local production in coming years, the report says, and ramping up exports will be critical in ensuring the market finds a better balance to support sustainable prices for growers. Australian export volumes of avocados have already increased by more than 350% in the past year. “The Singapore and Hong Kong markets have been stand-out performers, with Australia growing to account for 46% and 12% market share of their avocado imports, respectively,” Ms Piggott said. “Malaysia remains an integral export market and has re-bounded from COVID-related impacts, with Australian exports making up 46% of the total imported avocados into Malaysia. Exports to the rest of the world are also up, including to the Middle East and Japan.” “While exporting provides the greatest opportunity for Australia’s avocado industry to attract a good price and improve revenue, ensuring high export quality is paramount to maintaining the reputation and premium of the fruit, and continued investment in improving export access remains a key priority for the Australian avocado industry,” Ms Piggott said.
Production is up, prices are down and consumers are the winners according to a new report on avocados by Rabobank.
