Mexico is the largest avocado producer and exporter in the world and, within the country, the state of Michoacán accounts for 80% of national avocado production. Other regions in Mexico have also significantly increased their production, particularly Jalisco which now exports to 21 countries after expanding their production by 17% in 2020. However, the region is still awaiting approval to start exports to the US and China.
“Only Michoacán is authorised to export to the US,” an executive at an agribusiness in Mexico explains, “so other producing states have had to open other markets. As global demand has grown, other countries have started to pay a higher price than the US so other states, such as Jalisco, have grown substantially. Another benefit of Jalisco is the security situation. Organised crime is a problem in Michoacán, less so in Jalisco.”
“Another benefit of Jalisco is the security situation. Organised crime is a problem in Michoacán, less so in Jalisco.”
Executive, agribusiness, Mexico
An avocado producer in Michoacán details the daily reality of operating in the state, “Safety is a problem and there is a lot of pressure on the production and logistics companies, including charges of up to 5 pesos per kilo of avocado levied by criminal organisations. If these fees are not paid, roads are blocked, fruit is destroyed or trucks are stolen. Few companies actually produce avocados themselves, almost all of them buy from small producers, we only sell and distribute worldwide. Now, we are seeing buyers starting to look outside Michoacán to avoid the organised crime issue.”
“There are charges of up to 5 pesos per kilo of avocado levied by criminal organisations. Now, we are seeing buyers starting to look outside Michoacán to avoid the organised crime issue.”
Avocado producer, Michoacán
According to the UN Food and Agriculture Organisation, the boom in avocado consumption throughout the world is expected to continue and reach 12 million tons by 2030, more than three times the level of 2010, which will make avocado the most commercialised tropical fruit by 2030. As avocado production is concentrated in a small number of countries in Latin America and the Caribbean, the region will continue to reap the benefits of this market growth.
Furthermore, the pandemic has barely affected the sector, according to a commodities trader in Mexico City, “On the contrary, healthy eating has become more important than ever so organic market growth has been strong. There were some challenges, mostly related to logistics, but these were short-lived.”
Aside from Mexico, Peru, Chile and Colombia are the countries that will benefit the most from this trend. By 2018, Peru exported USD 722.3 million, Chile USD 323.2 million and Colombia USD 62.7 million. The growth trend for these countries continues as worldwide demand for avocados increases.
To avoid jeopardising the development of its USD 2.4 billion avocado industry, Mexico needs to address the involvement of organised crime, which extends from cultivation through to transportation.