Renowned agronomist Alfredo Lira believes that the work is being done in the fields and the challenges lie in positioning Peruvian avocados in such a way that their price is not penalized.

Alfredo Lira Chiris is an agronomist from the National Agrarian University La Molina in Peru. Through an alliance with the National Agricultural Society, he obtained a postgraduate degree from Adolfo Ibáñez University in Chile, in a program that later became the MBA in Agro-industries. He was born and raised in the countryside, with his father and three older brothers sharing the same profession. Today, he is an internationally respected authority on Peruvian avocados and the rest of the industry.

“We have always made a living from agriculture. I have worked in agribusinesses, at Agrícola Cerro Prieto, and I had a short stint at Camposol, where we put together a four-month business plan to design a roadmap for some of the business units of this very large company. I have always been involved with agriculture, with fruit trees and especially with avocados,” he recounts.

He currently holds no corporate position and contributes his experience as a consultant, gained from several years managing teams. He says this allows him to view things with an open mind, making him a respected voice in the avocado industry.

As he told Avobook last week, avocado production in his country has had a very challenging year, due to weather conditions that have forced producers to face almost everything.

“Some time before I left Cerro Prieto, I was talking to the board and telling them that the only thing missing was an El Niño phenomenon. And, boom!, El Niño came. Last year we had “El Yaku”, which also impacted our fruit volumes. So, it was like the perfect storm,” he explains.

Even so, his country has achieved progressive growth in the world market, concentrating its production mainly in Europe, although with clear efforts to balance the numbers between the old continent and the United States, where -he believes- there is much work to be done.

- What's the difference between the production in the Peruvian highlands and that on the coast? “The morphology is relatively similar. In some places it's rougher, in others, less so. The important thing, even on the coast, is that the further north you go, the earlier it ripens. And the further north you go from the central coast, say Piura, where there are few orchards, it ripens in February or March, but with quite small fruit. It tends to compete in the market with the later, higher-altitude fruit from our neighbors in Colombia. And then, as you go south, the fruit ripens later until it reaches the central coast, where it should be ready between July and August, which is just before our Chilean neighbors harvest their crop. In fact, much of that Chilean fruit is consumed by the Chileans themselves at the beginning of the season.”

- And how does the Peruvian highlands produce complement the coastal harvest? “The Peruvian highlands produce fruit earlier. Depending on the area, it can be harvested in late December, January, and February, which fills in the growing season. There are large growing areas, but not yet large enough volumes. This doesn't significantly impact prices. So, you see a significant price increase during the Chilean season, from August and September, which remains high until March; and then, when Peru's season begins, prices in Europe drop due to the large volume of fruit coming from the coast, central Peru, and a little bit from northern Peru.”

- This fruit is primarily destined for Europe. But are there opportunities to expand into the United States? “The important thing is how the fruit reaches the market. The ripening process it undergoes during transit. The United States is very important because of its proximity. But Colombia has transit times of five days. For example, from Cartagena to the east coast of the United States, the fruit can be more ripe, something we can't do in Peru, and that creates a competitive advantage.”

Does that significantly impact Peruvian fruit prices? “Last year there was less Mexican fruit due to various weather events. But they were paying $70 per box for Mexican fruit and $35 for Peruvian fruit, even though there wasn't much fruit available. It's true that it's not as 'buttery' as Mexican fruit, which ripens on the tree. But that creates a price difference that, for a company I worked for, represented about $20 million in revenue. So, the American market needs to be developed by increasing fruit ripening in Peru. In other words, there's still a lot to be done. Even more so considering what happened last year, which was spectacular: for the first time ever, Peru matched Mexico's weekly fruit shipments for three or four weeks. That is, the same number of containers are entering the United States from Peru and Mexico. It's something that was unthinkable.”

- What does Peru need to improve its performance in North America? “The new irrigation projects will allow us, hopefully quickly, to bring some 50,000 new hectares into the area 1,000 kilometers south of Lima. If we follow the same logic as Piura, first, and then south, including Chile, which starts in August, September, and possibly a Flor Loca festival in February, we can take advantage of the period around the Super Bowl. But there's an important issue here: we haven't done our homework.”

- Where has the work fallen short? In production or marketing? “The price difference I mentioned, I attribute partly to commercial issues, not necessarily to the fruit's inherent qualities. We give the market the reason for this to happen. We could have addressed the problem better if we had started ripening the fruit and providing a service to supermarkets to ensure it arrived in better condition and prevented a price difference compared to Mexican avocados. Last year, that price difference of 70 to 35 existed, but not in the supermarket. You went and bought avocados at the same price. There weren't Peruvian avocados half the price of Mexican ones. That difference was lost along the way, somewhere. The effort is being made in the fields, by the producers. There has to be a way to reach the market effectively.”

- How is the percentage of Peruvian shipments distributed to world markets? “I would say that 50% of our avocados are already in Europe. Before, it was between 55% and 60%. Between 30% and 35% go to the United States. In Asia, China is important, and Japan and Singapore have been added, totaling 10% for that continent. And our Chilean neighbors always come to the rescue with 5%, where avocado consumption is astounding.”

- Why do you describe it that way? “Here’s a fact: Peru sends 600 containers to Europe, and last year prices started to decline weekly. Chile consumed 110 containers per week, with prices obviously a bit lower, but they consumed them. Considering that Chile has about 20 million people and Europe has 500 million, the volume-to-population ratio is impressive. That’s why Chile has become an important market for resolving problems when they arise with Peruvian volumes.”

- Are there opportunities to place the fruit in other Latin American countries? “I think Argentina, Uruguay, and Paraguay are going to be important markets now. We should never forget Brazil. We're not working there as quickly as we should to encourage consumption.”

- In Peru there are many young trees. How are production projections for the coming years given these circumstances? “There are also old trees. Here, companies like Camposol have 25-year-old orchards, and some are over 15 or 18 years old. Here, technically speaking, compared to Chile, production begins in the second year, not the third. For example, from kilometer 500 north to Olmos, in the second year you can harvest 7,000 or 8,000 kilos per hectare, which is probably the Chilean average. Those same orchards will then yield 15,000 kilos in the second year of production and 25,000 kilos in the third. This is in sandy substrate, with climates that don't have minimum temperatures below 15 degrees Celsius. This keeps the trees very active. So, our production period is shorter, and the rotation of orchards should be faster.”

- How do you see the entry of new players into the same markets? “All markets regulate themselves. New countries and regions have entered the market. In the end, only the most efficient will remain. If there are plenty of avocados, consumption will continue to grow. Even China is starting to produce avocados.”

"And isn't that a threat? " "No, because once China starts producing avocados, they'll consume more and they'll pull us along for the off-season. The day they decide to eat one avocado per person, that's the end of the avocado industry. This happened with white asparagus. In Peru, there were some Spanish companies producing white asparagus, and they told us, 'China is starting to produce it.' We were terrified. In the end, the wave of consumption began in that country, and at some point, they couldn't keep up with demand. So, the business never declined as much as we expected."