Monday, July 22, 2024

Local avocado production continues to smash records

Australia’s avocado industry is grappling with another year of increased production and low prices, according to a new report by agribusiness banking specialist Rabobank.

In its recently-released Global Avocado Update 2024, Rabobank says production forecasts for the financial year 2023/24 Australian avocado crop are up by 20 per cent year-on-year (YOY) to 139,000 metric tonnes. This sees Australian avocado production at a record-high level.

This growth is driven by more than 1,500 hectares of avocado planting expected to reach maturity this year, bringing additional supply to the market, according to report co-author, RaboResearch analyst Pia Piggott.

“And expansion in Australian avocado production is set to continue with more than 4,000 hectares of orchards maturing in the next five years,” she said.

But while demand for avocados among Australian consumers continues to grow – with the local market increasing at a compound annual growth rate (CAGR) of 10 per cent over the past decade – Ms Piggott says the local market remains oversupplied, with prices languishing at low levels.

Australian retail prices for avocados currently sit at around the same level they were at this time last year. However in the past year, there has been a lot of volatility in avocado prices, reflecting periods of fluctuating seasonal supply.

Ms Piggott said the bank expected avocado prices would remain volatile “and we may see some increase in prices in the summer months as Western Australian avocado production is in an ‘off year’, with crops bearing less fruit”.

“But after this, supplies will again start to increase and prices are expected to decline,” she said.

In terms of varieties, hass avocados are expected to continue to dominate in the near-term, but while hass-like varieties that have higher yield potential and improved efficiencies, will gradually gain adoption in the coming years.

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