Mexico and California, in a game of supply and demand
Mexico
Mexico exported 737 shipments to the United States market during week sixteen. Despite the week having only three harvest days due to Holy Week in Mexico, the volume was slightly higher than expected, mainly due to shipments made on Monday the 14th using inventory from the previous week's harvest.
Exporters were harvesting moderate volumes during the three days, with no situation of desperation to fill orders. It could be thought that both importers and exporters prepared well in advance of Holy Week so that the harvesting, packing and shipping plans were carried out without setbacks.
Fruit inventories in the United States remained above the levels needed to maintain price stability. The California harvest this week was surprising, and it was clear that many participants in the Mexican industry had not anticipated it. By Friday, April 18, nearly 30,000 tons of inventory were being reported, with California accounting for 10,000 tons.
Demand for fruit during the first two days of week seventeen has been moderate to low, as anticipated in last week's commentary. There is no sign of increased demand for the May 5th promotions, which theoretically would be the final days of shipping to ensure timely delivery. The fruit is already in place, and we just need to wait for the promotions to be successful and for inventories to decrease sufficiently so that in a few days importers will require fresh fruit to fulfill post-event orders.
Mexican producers began the week still optimistic about an increase in demand that would at least allow them to maintain farmgate prices, but this has not been the case. Prices are trending downward, and this trend is not expected to change until exporters receive new orders toward the end of this week, or at the earliest.
It can be assured that California will maintain its harvest rhythms and the incursion of fruit from Peru is getting closer; we continue to wait with interest for the arrangement of the different origins in the same market.
It is reported that the new season's fruit harvests in the state of Jalisco have begun with slightly higher volumes. This fruit is destined for locations other than the United States, which could change the dynamics in markets such as Canada, Central America, and Mexico's own domestic market.
Sergio Paz Vega, General Manager, Coliman Avocados, sergio.paz@coliman.com , Mexico