South African and Peruvian avocado supply saturates European market
South African avocado exporters are licking their wounds after a 'disastrous' start to the season when their shipments clashed with Peru's, flooding the European market.
Producers sent fruit over earlier than normal in late April and early May to try and beat Peruvian shipments, however the strategy back-fired as their competitor also shipped early.
U.K. based Poupart Imports, which sources fruit for wholesalers, food service companies, cruise liners and airlines, said the market was overloaded.
Managing director Jonathan Olins, explained that because avocados arrived at the same time it was impossible for the market to "absorb it".
"It was basically a disaster, there was too much fruit and the market has crashed. A lot of damage has been done and people don't want to go back into Europe. Growers had a lot of fruit in the begining of the season and this was pumped into the market."
South Africa Avocado Growers' Association overseas technical officer Richard Nelson, said it was unfortunate that the communication about Peru's Hass shipments was inaccurate.
"The guys were trying to get ahead but they ended up in an oversupply situation, that was why the market was so difficult."
He also said wet weather in the early part of Europe's spring affected demand. He wouldn't be drawn on current wholesale prices which he said could fluctuate from as low as €4 (US$5) per 4 kilogram carton to up to €8-12 (US$10-15) per carton.
"Unfortunately, we need to make sure that the market is not oversupplied to have the chance to see prices increasing a lot more to acceptable levels. In continental Europe we are now getting into the situation where you are getting local seasonal fruit such as nectarines and cherries which compete with us."
Although, on a brigher note he described the quality of South African avocados this year as surprisingly good with fruit holding up well and high yields.
Nelson estimates South African exports this year will hit 50,000 metric tons (MT), nearly twice the amount shipped last season which suffered from hailstorms and was an 'off-bearing' year.
He is optimistic prices will bounce back as South Africa hits its peak exporting point, from June to August, because of the quality of the fruit and its ability to stay on the trees and still be in good condition.
Spanish exports are drawing to a close with a deterioration in quality with Peru still the main competitor alongside smaller shipments from Kenya and Morocco.
Peru and South Africa share the same export window which generally runs from May until the end of September.
Related stories: European avocado prices drop as SH supply takes off
Peru could 'easily double' U.S. avocado volumes in 2012, says expert