Avocado prices have jumped 75% since mid-July thanks to high demand and crop shortages in Mexico and California.
What the guac?
Avocado prices have hit another all-time high thanks to heat waves and droughts drying up the supply in California and Mexico.
Skyrocketing demand across the globe, plus the much smaller crop yield this year, has added up to a case of 88 Hass avocados from Mexico costing $80, the American Restaurant Association Inc. reported – about four times what they cost in early 2016, and up 75% since mid-July.
That wholesale spike has trickled down supermarket shelves, where the average price of a Hass avocado surged from 89 cents in January to $1.21 apiece in July, according to the Hass Avocado Board. If you’re going organic, they’re more like $1.74 a pop (up from $1.50 in May.)
This is also the most expensive that avocados have run in the 19 years that data has been collected, and California suppliers are warning that the fleshy green fruit could climb as high as $3 a pop – and that’s not even the organic varieties.
And restaurants that dish guacamole and other avocado products have been hit hard. Chipotle increased prices by about 5% in one-fifth of its stores earlier this year. Subway no longer offers fresh avocado as a sandwich topping.
Alessandro Biggi, the co-owner of Brooklyn’s new Avocaderia bar devoted to avocados, said the price of the fruit has doubled since creating their business plan. He and his partners will try to avoid raising menu prices by buying avocados in even greater bulk.
“Of course, that might change in the future,” he warned. “But we’re trying to keep the pricepoint ($6.95 for toast, $14.95 for an avocado burger) affordable.”
So how did we get here?
Well, just over 80% of the avocados that Americans use come from Mexico, whose avocado shipments to the U.S. ballooned from 24 million pounds in 2000 to a 1.76 billion pounds in 2014, according to the Hass Avocado Board.
We’ve developed an insatiable appetite for the buttery fruit, particularly as medical studies claim the omega-3 fats in avocados provide health benefits like lowering your risk of cancer and heart disease. Plus, they’re a rich protein source for vegetarians and vegans that tastes great.
So we’re buying twice as many as we did a decade ago; per-capita consumption jumped from 3.5 pounds in 2006 to 6.9 pounds in 2015, per U.S. government data. And now Starbucks has avocado spread on the menu, McDonald’s is dishing guac, and even Walmart is going to start offering avocado toast.
But that supply is struggling. Avocados are an alternate bearing corp, which means a larger harvest one year is often followed by a smaller crop year. Alas, 2017 is the dud year.
And as previously mentioned, the weather is hurting this year’s harvest in California and Mexico. Peru also lowered its crop forecast after severe flooding.
The bottom line is that avocado prices will remain elevated for months to come. But the good news is, Vice President Mike Pence announced last month that the Trump administration is lifting a ban on Hass avocados from Colombia, which will increase supply. And in the short-term, Amazon’s acquisition of Whole Foods as seen organic avocados (originally $2.79 apiece) on sale for just $1.99 each.
This article was originally published on May 3, 2017, and has been updated with the most recent avocado prices.
© 2017 Dow Jones & Company, Inc. All Rights Reserved