Agronometrics in Charts: Will the recent trend of stable avocado prices continue?
In this installment of the ‘Agronometrics In Charts’ series, Colin Fain illustrates how the U.S. market is evolving. Each week the series looks at a different horticultural commodity, focusing on a specific origin or topic visualizing the market factors that are driving change.
The U.S. avocado market has been a rollercoaster ride so far this year, but the last five weeks have offered a sense of stability that has been absent from 2020 thus far. That might come as a bit of a surprise considering Covid-19 and all the unrest that has been making headlines over the same time period.
Comparing the pricing to the historic data it looks like the market is lining up to where it was in 2018, making it a good basis for comparison in our analysis.
Hass Avocado Prices (Price Reported) | Non-Organic
(Source: USDA Market News via Agronometrics. Agronometrics users can view this chart with live updates here)
The volumes, however, look quite a bit different then what we saw in 2018, dipping from week 20 to 24, whereas in 2018 we saw volumes spike.
Considering that avocados can be stored, a spike in volume never tells the whole story, but we can take an average over the last two months to make an rough estimation of how much fruit is actually moving into the market. By this calculation, 2020 has moved 5% more volume than 2018.
Historic Avocado Volumes | Non-Organic
(Source: USDA Market News via Agronometrics. Agronometrics users can view this chart with live updates here]
Volumes from California and Peru are both closely tracking the same levels they were at in 2018. This means that most of the new volumes are coming from Mexico, which has seen an increase of 10% over 2018.
The Hass Avocado Board is forecasting that over the next eight weeks the market will receive 13% more fruit than it moved in 2018.
Unlike the last eight weeks, most of the growth is expected from Peru, which is expected to send around 5% more volume than 2018 and California which is expected to send 25% more volume. Mexico on the other hand is expected to remain similar to its 2018 volumes with only a 2% increase.
This forecast suggests that prices should be lower over the next couple of months, dropping modestly by 5% or 10%.
This expectation comes with a lot of caveats, such as the volume forecast being correct, Covid-19, lockdowns, a second spike, etc. But going by the numbers, hopefully the markets will remain stable as they transition to be able to handle the coming volumes.
In our ‘In Charts’ series, we work to tell some of the stories that are moving the industry. Feel free to take a look at the other articles by clicking here.
You can keep track of the markets daily through Agronometrics, a data visualization tool built to help the industry make sense of the huge amounts of data that professionals need to access to make informed decisions. If you found the information and the charts from this article useful, feel free to visit us at www.agronometrics.com where you can easily access these same graphs, or explore the other 20 fruits we currently track.