Mexico exported 850 containers to the United States during week 18. This appears to be a moderate volume, which did not significantly impact reported inventories, especially after the events of May 5th. Mexico's share of that market has decreased considerably and is expected to continue declining in the coming weeks.

Although demand for fruit in Mexico wasn't high, farmgate prices didn't adjust downwards to match market demand. Until the beginning of week 19, market prices were observed that didn't reflect what producers were being paid. Undoubtedly, someone in the supply chain was losing money, at least for some sizes. Size 60 was the most problematic; however, larger fruit also experienced a considerable price drop, even though yields for sizes 40 and above remain very low compared to other seasons. Size 70 remained more stable until the end of the week, but its price also began to decline at the start of week 19.

So far this season (July 2024 to date), Mexico has exported approximately 10% less than last season; however, average prices have been considerably higher. For producers with average yields, it has been a very good year. The question now is how Mexican producers who still have fruit on the trees will react or what decisions they will make in the next 7-8 weeks. The US market and the domestic market are the only ones that can absorb the remaining available volume. The US market will not be at the levels producers expect, and prices are sure to continue falling, which is unusual for this time of year. Competition from other origins is inevitable, with the advantage of the flexibility in sales methods offered by those other origins. The domestic market has maintained good demand and, for some sizes, is paying better prices than the US, so several producers have decided to harvest their fruit for this market.

The truth is that the market is in the process of adapting to what will be seen in the coming months, and this change seems to be happening ahead of schedule and with much speculation about the arrival of fruit from Peru. While it is a fact that it will arrive, there are still no significant volumes; there is more noise in the market than actual arrivals or inventories of Peruvian fruit.

Mexican producers who still have fruit from this season will also have to consider the impact of fruit from other origins in other markets, as well as the start of the next season in Mexico. In the state of Jalisco, the new fruit harvest has already begun and has generated some activity in the Canadian market.

Sergio Paz Vega, General Manager, Coliman Avocados, sergio.paz@coliman.com , Mexico