The naughty one officially in action

Exports of our beloved Hass avocados (#AvocadosFromColombia) continue to show a clear trend: nearly 95% of the volume is still headed to Europe, with just over 65 containers per week. The United States, meanwhile, receives no more than five containers per week.

Prices continue to decline week after week. However, it's worth remembering that they are coming from particularly high positions, which somewhat mitigates the perception of a drop. Interestingly, and not insignificantly, during this same week last year, 65% of the cargo was destined for the United States and only 35% for Europe, with an average of approximately 90 containers shipped.

Today, the market is under strong pressure on smaller sizes, while larger sizes still have some leeway. However, signs are beginning to emerge from Peru: adjustments in production areas could also put pressure on medium and large sizes in the coming weeks.

In the United States, the story remains stalled. Clear opportunities for Colombian avocados have yet to emerge in this market, and it's still too early to predict what might happen leading up to the main harvest in that market.

In the field, the numbers speak for themselves. The average purchase price for fruit with all certifications is around 3,600 pesos. The current distribution shows 10% large sizes, 50% medium, and 40% small. This week, there was also a drop of nearly 10% in prices: large fruit averages 5,000 pesos, medium 3,500, and small 1,700.

It is important to reiterate —as in previous columns— that these values correspond to fruit before the selection process for export, so they may decrease depending on the efficiencies of each producer and the specific requirements of each packing plant.

Added to this is a factor that hasn't gone unnoticed: the exchange rate is falling. On the one hand, this can alleviate certain logistical costs; on the other, it directly impacts returns, which arrive in euros or dollars.

The harvest, so far, has shown rather atypical volume. Everything indicates that there won't be an abundant supply of fruit for export, and we're back to a familiar scenario: direct competition between the domestic market, exports, and the processing industry.

And the key question remains:

Does the producer really benefit from a low-volume sleeper?

The answer, like almost everything in this business, is: it depends.

A lower volume can support prices… but it doesn't necessarily improve profitability and puts pressure on exports and their final destination as long as Peru operates at its capacity each year.

For exporters, the challenge lies in maintaining programs with less fruit and greater commercial pressure. For the domestic market, an interesting window of opportunity for supply opens up. And for processors, a clear opportunity to acquire fruit that doesn't meet export standards. All are in competition.

In other words, a short sleeper isn't automatically good news. Rather, it's a scenario that demands precision: in production, in marketing, and in market analysis.

Because in the Colombian Hass avocado business, it's not always the one with the most fruit who wins… the one who best understands where to place it wins…

Jorge Molina Duque
Operations Manager, Quality Studio CO
jorge.molina@qualitystudio.cl
Colombia