Australia has an Avocado problem

Australia is producing too many avocados. In return, this drives prices down and wastage up. News reports have shown thousand of avocado fruits being thrown away and left to rot. This is an attempt by avocado farmers to control rising costs (such as packaging and transport) and very tight profit margins.

To manage the ever-growing supply of avocados, farmers are encouraging Australians to eat and purchase more Australian avocados. In another attempt to control lower profit margins, Australian avocado farmers are also doing their best to export avocados to other countries, where demand is high for avocado variations that might not be very popular in Australia.

Investment in avocado trees in Australia and the maturing of these trees is creating this situation, and therefore a more long-term solution is needed.

Throwing away good avocados to control the relationship between demand and supply is never a solution, especially when so many people worldwide are suffering from hunger.

Avocado is a super-food, and many people in many countries would be happy to import and purchase avocados at good and competitive prices.

Pia Piggott, from RaboResearch explains very well the relationship between demand and supply, and how increased production brings about a drop in price, as producers do their best to sell their produce.

“Simple demand-and-supply economics tells us that when supply increases, the price will drop, so prices this year are 47 per cent below the five-year average as well,” Ms Piggott said.

A potential, alternative short-term solution is to turn these extra avocados into compost, although exporting the fruit to other countries is probably the best long-term economic and environmental solution.

The message of Avocados Australia chairman Jim Kochi is simple: “It’s one of the superfoods, I guess, and we just need Australians, those lovers of avocados, just pick up one more.”