They’ve been the subject of many a conversation over the past few years and deemed the reason millennials have been struggling to enter the housing market but now, the humble avocado has gone from *luxury* breakfast addition to almost a necessity with the avo-lanche of avocadoes in the country.
Australia will need to both consume and export more avocados as the nation’s growers navigate a period of soaring production growth over the coming five years, specialist agribusiness bank Rabobank says in a new report.
This year alone, ‘per capita (person) supply’ of avocados is estimated to be up 26 per cent on the previous 12 months to 4.8 kilogram – equating to 22 avocados for every Australian.
In the avo-lanche of Australian Avocados, the bank’s outlook for the avocado industry, Rabobank says a significant maturing of avocado trees in the past season – primarily in Western Australia and Queensland – has resulted in a bumper crop, causing a national oversupply and seeing retail prices fall to a record low of $1 each in June last year and again early this month. And retail prices for 2022 remain tracking at 47 per cent below the five-year average.
While the low prices have been welcomed by consumers currently facing significant price rises for many other food items and household staples, they have put considerable pressure on grower margins, already squeezed by increasing input costs and labour shortages, says report author, RaboResearch associate analyst Pia Piggott.
The report says Australia’s avocado market is “cycling through a period of significant production growth”.
“A bumper 2021/22 crop in Western Australia was a turning point,” Ms Piggott said, “with industry estimates of avocado production in the state being up a staggering 265 per cent on the previous year.
“This was driven by a 21 per cent increase in the hectares of avocado trees in WA that reached maturity and produced fruit in this season, coupled with optimal growing conditions in the state.”
WA – along with imports from New Zealand – supplies the majority of Australia’s avocados during the spring and summer months.
All other Australian avocado-growing regions – except North Queensland, which had seen a record harvest the previous year – have also seen slight year-on-year increases in production in 2022, the report says.
And the past year’s market oversupply in Australia was “just the beginning”, the report says, with industry forecasts that domestic avocado production will expand by 40 per cent (or 50,000 tonnes) in the next five years.
All avocado-growing regions in Australia are expecting production growth, Ms Piggott says.
The good news is consumers’ appetite for the likes of smashed avocado and avo smoothies remains healthy, both in Australia and abroad – with local demand forecast to continue to grow while consumer demand is also expanding in offshore markets, providing Australia’s export sector with a platform for growth, the report says.
“Avocados have a strong health halo and are price competitive amid the broader cost of living pressures and this has supported Australian domestic demand.”
However, increasing consumption of avocados in Australia will not be enough to use up the ‘avolanche’ of additional local production in coming years, the report says, and ramping up exports will be critical in ensuring the market finds a better balance to support sustainable prices for growers.
Were you one of the lucky ones who got their hands on one of the GIANT avocados at the Central Market this season?
For more information on this report, visit the website.
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