South African retailers cut avocado consumption as sales slow

The Zimbabwe Avocado Growers Association has advised its growers to slow down their harvest as they expect nearly 1,000 containers, mostly from Peru, on their way to Europe “so the supply of avocados will be extremely high and this will exert without no doubt pressure on prices in the future”.

South Africa has been exporting avocados for some time and where usually South African avocados fetch good prices on week 19-21 arrivals, this year the European avocado market has been under pressure from departure.

The war in Ukraine has complicated the transition from avocados from the northern hemisphere to products from the southern hemisphere. South Africa needs to be in Europe as soon as possible, before the huge volumes from Peru arrive.

Israeli avocados were still on the market when South African avocados arrived, and the latter part of the window is expected to be affected by volumes from Peru continuing to arrive.

Laggards earn less
“The market starts high and ends low. You try to time your harvest and time your crossings to get to market as soon as possible. And although we had less problems this year with cold fronts in Cape Town, in my opinion we had problems with irregular and unreliable sailing times,” says an avocado grower from Tzaneen.

“A ship took more than 50 days to sail [to Rotterdam], more than double the usual navigation time, and it’s a disaster for our fruits. It is a great frustration for us. »

A delay of five days may not seem like much, he observes, but it can lead to a reduction of 1 euro to 1.5 euro per box, “which makes a big difference for us”.

“If a ship is delayed for 15 days, it could easily make a difference of 2 euros on a box, and that translates into really big losses for farmers.”

Many payments are yet to take place this season, but at this point on-farm returns on exports are at levels they last saw five to 10 years ago, he notes. it, about R8 (0.46 euro) to R9 (0.52 euro) per kilogram less than last year.

Domestic avocado sales down from previous years
Local retailers have halved intake from their avocado programs, says avocado producer Tzaneen, in an effort to stabilize avocado prices.

“We get fair prices on our local supermarket programs, but the volumes we supply are so much lower.”

Purchasing power is under pressure and retail sales of avocados were much stronger last year, and even stronger the year before, says a retail avocado buyer.

“I suspect that due to the wide availability of avocados in municipal markets (due to hail-damaged Class 3 fruit and export uncertainties), franchise stores are buying from the market rather than from the market. ‘retail distribution center intermediary’.

Franchise retailers have the choice of bringing their product to market if prices are lower (it’s between R14-15/kg) and this in turn has, she notes, an “incredibly big” impact. on direct selling programs.