Very Strong Market Continues for Organic Avocados

Organic avocados continue to be in very high demand, with the fruit commanding an excellent FOB price even though volume is also on the rise.

“Supply [of organic avocados] has been pretty good leading up to the Super Bowl [February 13],” said Patrick Lucy of Del Rey Avocado Company in Fallbrook, CA. “We’ve seen the volume ramp up on all sizes from Mexico, and now California is kicking in with some organic fruit as well.”

Patrick Lucy, Del Rey Avocado

Lucy said both volume and pricing is higher than it was last year at this same time, which points to very good demand for organic avocados.  Speaking specifically of Mexico’s production, he said, “We are seeing a pretty good bell curve with a good amount of 32s, 36s, and 40s and peaking on 48s and 60s.”

“We’ve seen the volume ramp up on all sizes from Mexico, and now California is kicking in with some organic fruit as well.” – Patrick Lucy

Lucy added that the FOB price for organic 48s is in the high $60s to low $70s while 60-size organic avocados are returning more than $60 per carton. “Starting off in early January, we’ve seen a tight market with very good pricing, even though volume has been good. The prices we are getting right now are summer prices (when demand typically exceeds supply).”

The Del Rey executive is not expecting much of a drop off in the organic pricing structure even after the Super Bowl pull is complete early next week. He said it remains to be seen how long Mexico will have a robust organic crop, but with the volume that has been shipped recently “we could see these good prices continue for several months.” He added that while some California growers did size pick, and even a few groves were stripped to take advantage of the excellent pricing surrounding the Super Bowl, California production isn’t expected to kick in with good numbers again until mid-to-late March.

In fact, the Hass Avocado Board, which reports actual harvest and projections by the various points of origin, revealed that while California harvested more than 5 million pounds of avocados the last week in January, it is not expected to reach that volume again until March. California’s February volume is projected to be under 2 million pounds per week until reaching about 3 million pounds during the last week of the month. March volume is expected to be in the 6-7 million pounds per week range, with organic volume estimated to be close to about 10% of volume. 

Rob Wedin of Calavo Growers also reported that organic demand is very high with excellent pricing this early in the season. “The market is strong,” he said. “Today [February 2], my price sheet says [organic] 48s are going for $68 while 40s and larger are in the mid-$60s, and 60s are at $63.”

Rob Wedin, Calavo Growers

Wedin added that each of those prices are about $10 more than the price on conventional fruit. Though organics do have a market of their own, there is a strong relationship with the conventional market, and the avo veteran Wedin said his sense is that the market price on all avocados will remain solid even after the Super Bowl.

“The market is strong. Today [February 2], my price sheet says [organic] 48s are going for $68 while 40s and larger are in the mid-$60s, and 60s are at $63.” – Rob Wedin

Conventional production dwarfs organic production in Mexico, and Wedin said growers tend to run out of organic fruit before the conventional crop begins to wane. Mexico’s avocado crop year runs from July 1 to June 30, so at this juncture, the season has passed its midway point. Wedin said it appears Mexico has a bit smaller crop than anticipated, though it is still expected to produce significant volume for the next several months, with many weeks of shipments topping 50 million pounds.

On the organic side, Wedin said demand and supply appear to be working in perfect unison. He orders organic volume every day from Mexico, and grower-packers do deliver whatever he orders—and US buyers are snatching up that volume even at these higher-than-usual FOB prices.

Gahl Crane of Temecula, CA-based Eco Farms echoed the comments of the others interviewed, marveling at the strength of the organic avocado market despite increasing supplies. “The market is fairly high, and I believe the prices are going to stay pretty strong for the next several months.”

Gahl Crane, Eco Farms

He said California’s entry into the market with additional organic volume has been a welcome sight, but it has not caused the FOB price to fall. “We have seen very good demand even with these higher prices. We are getting outstanding retail support,” he said, adding that demand for organic avocados continues to increase.

Crane said that Mexico is contributing about 80 percent of the organic volume, while California is chipping in with 20 percent. He anticipates these percentages will remain about the same until at least late March and April when California is expected to begin harvesting more fruit on a weekly basis. However, he said it is the excellent FOB market that has brought California into the arena with heavier-than-anticipated volume in this early part of the season, and if the prices hold—as he expects they will—more California growers might join the party.

“We have seen very good demand even with these higher prices. We are getting outstanding retail support,” Gahl Crane said, adding that demand for organic avocados continues to increase.

The general consensus of the three shippers interviewed is that high demand for organic avocados means the fruit continues to offer promotional opportunities even if not promotional pricing.