Promotable Organic Avocado Supplies on Tap

Mexico's avocado producers are in full production, offering plenty of opportunities for organic avocado retail promotions this holiday season.

Mission Produce's Organic Category Manager Megan Berenbach said supplies are on the upswing. “The industry expects supply of organic avocados to remain plentiful through the end of the year,” she said. “Retailers have an opportunity [to] run promotions and take advantage of the organic volumes expected to come out of Mexico through Thanksgiving and Christmas.”

Megan Berenbach, Organic Category Manager, Mission Produce

Sizing on the organic fruit is leaning toward the smaller end of the spectrum, specifically 60s, “providing a great size curve opportunity for bags, which continue to increase in popularity," Berenbach said. "In fact, according to IRI insights, sales of bagged organics are up by 37 percent since November of 2020."

“The industry expects supply of organic avocados to remain plentiful through the end of the year.” – Megan Berenbach

Mission is attempting to capitalize on this situation in several ways. The Oxnard, CA-based company is promoting smaller-sized organic avocados in several bagged options. “With plenty of supply peaking on smaller fruit, we recommend retailers take advantage of pricing opportunities,” Berenbach said.

Del Rey Avocado Company has been touting an increase in organic production for several weeks. “They are in full go,” said Vice President Patrick Lucy, noting that Mexico’s "aventajada" crop (second bloom) was in full production in late October, with shipments expected to be in peak performance for many weeks moving forward.

Patrick Lucy, Vice President, Del Rey Avocado Company

Del Rey is a significant player in the organic category, and Lucy said organic supplies from Mexico have been very good with plenty of fruit in the 48 to 60 size range. The market premium is about 15 percent, a moderate price gap that lends itself to retail promotions, Lucy said.

“They are in full go,” said Vice President Patrick Lucy, noting that Mexico’s "aventajada" crop (second bloom) was in full production in late October, with shipments expected to be in peak performance for many weeks moving forward.

Del Rey is expecting excellent volume for at least the next three months, including organic supplies. As the season moves forward, Lucy said, the size of the fruit will improve, with larger fruit coming into play.

Rob Wedin, executive vice president of fresh sales for Calavo Growers in Santa Paula, CA, said there is a significant price gap between larger and smaller organic fruit, with size 60s and smaller offering excellent promotional opportunities. This past week, organic 48s had an FOB price of about $53 at the Texas border, while 60s were right around the $40 mark. The gap between organic and conventional fruit narrowed considerably in recent weeks, with a $5 to $7 gap on most sizes.

Rob Wedin, Executive Vice President of Fresh Sales, Calavo Growers Inc.

Analyzing upcoming supply, the data-centric Wedin said he is comfortable dividing Mexico's season into three-month intervals for forecasting purposes. “I’m feeling very good about November, December, and January,” he said. “We should have very good supplies throughout this period.”

This past week, organic 48s had an FOB price of about $53 at the Texas border, while 60s were right around the $40 mark.

The second half of the Mexican season (from January through June) could result in a different dynamic, Wedin said, depending on how much fruit is exported in the first half and how much fruit is actually on the trees.

Mexico has forecast a crop approximately the same size as last year's, so future volume depends on how much of those supplies are sold in the first half of the season. Of course, during the second half of Mexico's season, avocados are also available from other points of origin, most notably California and Peru.