Business & Real Estate

Why your avocados are about to get much more expensive - as high as $3 apiece

The California crop of avocados fell short of expectations and the area’s record-breaking heat wave is hurting the supply of the fatty fruit. Prices could climb as $3 apiece.
The California crop of avocados fell short of expectations and the area’s record-breaking heat wave is hurting the supply of the fatty fruit. Prices could climb as $3 apiece. MCT

Hold on to your wallets. Your avocado toast and fresh guacamole are about to get much more expensive.

Local prices are beginning to soar this month after the California crop of avocados fell short of expectations and a record-breaking heat wave hurt the supply of the fatty fruit, according to Produce Express, a leading vegetable supplier for the Sacramento region.

Produce Express owner and general manager Jim Boyce said avocado prices may climb to $1.50 in the coming week and could reach $2.50 to $3 per fruit after retail markup toward the end of August – roughly double what’s typical during that time – before imported fruit can start to ease the shortage and lower costs.

“It’ll hurt the restaurant industry,” Boyce said. “We may see some (businesses) add a surcharge for avocados, add or increase the price of a turkey avocado sandwich. We may even see some take them off their menu.”

At grocery stores, he expects customers to shift toward other items: “They’ll say, ‘I’ll buy nacho cheese instead,’” he said.

California’s projected avocado crop for this year is 215 million pounds, a dramatic drop from last year’s crop of 400 million pounds. Mexican growers are also sending less fruit than usual, according to Boyce.

Normally, Boyce said, Chilean fruit would be brought in to address the shortage, but Produce Express expects Chile’s avocados to go the East Coast this year, partly because of a strong European market paying top prices for the crop right now.

Peruvian avocados could lower prices when they hit West Coast markets by the end of the month, according to Boyce. But he says the typically more watery fruit is less optimal for slicing and makes for runnier guacamole, making it less popular among buyers than California’s and Mexico’s products.

Phil Henry, president of Henry Avocado Corporation, a grower and distributor operating throughout California, said he expects the shortage won’t truly ease up until Mexican avocados start shipping over the border in higher volume in September. He said Mexican avocado production is also down this year, but not nearly as sharply as in California.

Boyce said he believes Mexican growers are also limiting how much they ship to the U.S. in order to raise prices.

Explaining this year’s shortfall in the California avocado crop, Boyce cited a growing number of farmers who find it more profitable to sell their land than to grow crops – a problem for industries around many crops, not just avocados. Boyce and Henry also cited lasting effects from the drought despite a rainy winter. Years of dry conditions have made trees less healthy and affected their ability to hold fruit, Henry said.

Data from the Hass Avocado Board indicates the volume of avocados produced in California has dropped significantly in the past month. During the week of July 16, California produced 9,366,792 pounds of avocados. This week, California produced 3,741,987 pounds.

Comparatively, during the same early August week last year, California produced 10,733,164 pounds of the fleshy, green fruit.

According to data from the board, which formed in 2002 to promote avocado consumption, average sales prices were 32 cents higher this June than in January. June prices were the most recent data available. So far this year in Sacramento, the average sales price per fruit peaked at $1.64 on May 21.

The avocado shortage will affect not just California but the whole U.S., according to Boyce and Henry. California is responsible for the vast majority of domestic avocado production.

Prices will likely be even higher outside of California, Boyce said, because of normal transport costs that Californians don’t have to pay for crops grown in their backyard.

For now, local stores have a broad range of prices. At the Safeway on Alhambra Boulevard in Sacramento, the current price is $1.25, according to produce clerk Jose Bravo.

At the Sacramento Natural Foods Co-op, organic avocados are going for $2.29 apiece. At Raley’s, they’re $2.49 each.

Get them quick, people.

Hannah Knowles: 916-321-1141, @KnowlesHannah