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Avocado Shortage Predicted
Restaurants should be working with suppliers now to secure avocados before a shortage hits this spring.
image: No avocados for your guacamole?

Despite a smaller-than-average California crop expected this spring, there should be enough avocados to go around, experts say. But prices could reach a premium, and restaurants should work with suppliers early to secure their share.

Hot, dry weather from San Luis Obispo to San Diego during the blooming period last summer is expected to produce California's lowest avocado yield since 1990. At an anticipated 210 million pounds, this year's crop will fall short of the 2008 harvest by nearly a third.

“It's down over 100 million pounds from what was already considered a light crop,” says Wayne Brydon, field services manager for the California Avocado Commission (CAC). Yields have been as high as 600 million pounds in the past.

Traditionally, California has been the main supplier of avocados to the U.S. during the spring and summer months, though imports are also brought in from Mexico and Chile.

With the Chilean crop also proving smaller than average, this could be the first year in history that Mexican avocados will represent half or more of the total volume sold in the U.S.

“This has really given Mexico a very big opportunity to fill in a very big hole created by these two crop shortfalls,” Brydon says.

More than a billion pounds of avocados are sold in the U.S each year, averaging 20 million to 22 million pounds per week. This summer, with domestic and imported fruits, supply should reach 15 million to 20 million pounds per week.

“With what Mexico can bring in combined with California, we should have enough to fulfill demand or at least come close,” says Scott Bauwens, director of field services and marketing for Temecula, California-based West Pak Avocado, a packer, marketer, and distributor.

Still, buyers could see an increase in price.

Avocados currently sell for around $26 a box, but during the spring and summer prices could rise to around $40, says Avi Crane, CEO of Prime Produce International, an Orange, California–based avocado packer and importer. Jan DeLyser, vice president of marketing for the CAC, says prices could reach as high as $45 a box. The slow economy, though, could curb demand and keep prices in check, Bauwens says.

Crane also expects there will be a limited supply of so-called “foodservice grade” avocados, fruits with cosmetic damage that can be discounted from 10 to 50 percent. On the bright side, California's avocados are expected to be larger than usual this year, Brydon says. That bodes well for foodservice buyers, who typically prefer a bigger spec than retail buyers.

With a limited supply to work with, California growers will focus on supplying fruit to markets on the West Coast.

“The anticipation is that we won't be shipping as far east to Chicago and New York, except to buyers willing to pay a premium,” Brydon says. “We will try to supply the West Coast market, outside of that, the demand will have to be satisfied with imports, to a certain extent.”

While Mexican avocados are similar in taste, texture, and physical appearance to those grown in California, the main difference will be freshness. Since imports have to be shipped from further away in most cases, shelf life of the fruits could be to be two to three days shorter, especially later in the summer.

“Smaller, more manageable orders definitely can ensure freshness and quality,” Bauwens says. “Another thing you can do is cold-chain management. If they're ripe and ready and you've got a larger order, put them under cold storage right away to maintain quality and taste.”

To ensure their demands for avocados will be met this spring and summer, restaurants should work with suppliers now.

The anticipation is that we won't be shipping as far east to Chicago and New York, except to buyers willing to pay a premium.

“They should be talking to their suppliers earlier on, understanding what market is doing, and understanding what their supply source is doing,” Bauwens says. “If there does become a shortage situation, you're going to want to make sure you have your orders in advance so your suppliers can plan accordingly.” Ordering six months to a year in advance is best practice, DeLyser says.

The supply will be most stressed in June and July, experts say, but there is light at the end of the tunnel.

“This will be a short-lived period, from May to the end of August,” Crane says. Under normal growing conditions, a new Chilean crop should send prices back to normal come fall, and California's yields should improve in 2010.

“Don't take avocados off the menu,” Crane says.

Jamie Hartford is a regular contributor to QSRmagazine.com.