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Though the organic avocado market has strengthened a bit, the f.o.b. prices are still at rates conducive for promotion, with many retailers lining up to feature the item as part of their Super Bowl promotion next week.
“Right now, we are looking at historically low prices,” said Patrick Lucy, vice president of sales for Fallbrook, CA-based Del Rey Avocado Company in mid-January. “I believe we will see promotional opportunities on organic avocados from now into August. There should be plenty of fruit the entire time.”
Patrick Lucy, Vice President of Sales, Del Rey Avocado
With Mexico in the middle of its 2020/21 season, it has a solid crop of organic avocados and has peppered the United States with good supplies since the beginning of the new year. California’s overall avocado crop is down about 20-25 percent, but it still has good supplies, and avocado companies are expecting to deal with the decrease by truncating the season a bit on both ends. Lucy said Del Rey is expecting to start marketing its share of California’s organic fruit in mid-February.
“I believe we will see promotional opportunities on organic avocados from now into August. There should be plenty of fruit the entire time.” -Patrick Lucy
The Del Rey executive said bagged organic avocados have done exceptionally well since the beginning of the coronavirus crisis and he expects that trend to continue throughout 2021. Bagged organic avocados speak to two concerns of many shoppers during these challenging times.
Del Rey organic Hass
Firstly, the bagged option helps consumer avoid buying product that has been picked over by others. Secondly, consumers are more health conscious because of the virus, and organics have a perception of being a healthier alternative.
Lucy said increased promotional opportunities for organic avocados should continue to be the rule for the next six months as Peru is also expected to have greater volume of product when shipments start this spring (probably in April). He said Peru has a significant number of organic acres of young trees, which tend to produce large fruit.
Del Rey bagged organic avocados
Rob Wedin, executive vice president of fresh sales for Calavo Growers Inc., Santa Paula, CA, said organic avocados from Mexico will have to carry the Super Bowl promotions and agreed that most of California’s organic growers will not get started until February or later. He produced figures showing that only 34,000 pounds of organic avocados were picked in California last week (January 18-24), with 80 percent of them marketed through Calavo. He said that volume was the result of situational picking as specific growers had to pick their fruit for various reasons. For example, one grower has an organic grove near an unprotected road and was experiencing theft problems, so he harvested the grove early to salvage the crop.
Rob Wedin, Executive Vice President, Calavo Growers
Putting organic avocados on weekly retail ads has significantly increased this past year, and Wedin sees that trend continuing. He believes it is attached to a wider trend of increased demand for organic produce, and each retailer wants to let their customers know they are a player in the organic game. He notes that these advertising events aren’t always accompanied with a promotional price.
34,000 pounds of organic avocados were picked in California last week (January 18-24) with 80 percent of them marketed through Calavo.
The Calavo sales veteran reported that organic avocado prices this week ranged from $25-$35 per carton, based on the size of the fruit, with 48s being the most expensive and sought after, and small fruit (84s and larger) returning prices at the lower end of the spectrum.
Moving forward, Wedin said organic prices should ebb and flow but will tend to offer better promotional opportunities once California enters with good volume and there are two organic points of origin to choose from. More choices in the spring, with the addition of Peruvian supplies, could again allow for more retail promotions (though Mexico’s organic supplies will most likely wane in late spring).
Calavo bagged organic Hass avocados
As Wedin spoke on Tuesday, January 26, a rainstorm was beginning to drench Northern California. He said that rain was expected to hit his Southern California perch later in the week, and it was much needed. “We do have a smaller crop, which means there is potential for the fruit to size up pretty well, but we need some rain and then sun for that to happen.”
Gahl Crane, sales manager for Eco Farms, Temecula, CA, echoed the comments of the other two shippers. “We are still riding the wave of 2020, which saw incredible demand and growth in the organic avocado category. We have seen a big push all month [January] for organic avocados, with the category getting about a 10-15 percent share of market as far as ads go.”
Gahl Crane, Sales Manager, Eco Farms
He also used the word “incredible” when describing how well bagged organic avocados have done over the past year. He said many retailers are carrying both bags and bulk in the category, but bags are an advertising favorite. “The demand is incredible with consumers taking fewer trips to the market and buying more,” he said.
“We are still riding the wave of 2020, which saw incredible demand and growth in the organic avocado category. We have seen a big push all month [January] for organic avocados, with the category getting about a 10-15 percent share of market as far as ads go.” -Gahl Crane
Other than a few growers size picking a grove or two, Crane agreed that California’s organic avocado crop probably will not get going in a big way until late February or early March. “But then we should have good supplies for March, April, May, June, July as it mirrors California [produce] supplies in general.”
Crane expects good promotable supplies of organic avocados through the first two quarters of 2021, with Peru making up for any dip in Mexico’s supplies in late spring. “For the next couple of months, I expect pricing on organic avocados to remain steady with no major changes. We may see some price increases in April and May as Mexico’s volume declines,” he said.
