Australian avocado farmers are navigating through periods of low prices and surplus production by targeting profitable export markets. Riverland avocado farmer, Justin Loffler, is among those expanding their orchards, having planted over 600 new trees, aiming to capitalize on the growing global demand for avocados. Loffler emphasized the importance of export markets for absorbing excess production and ensuring sustainable returns for Australian growers.
Despite a domestic oversupply, the industry is on a trajectory of growth, with expectations of increased production over the next five years due to new plantings. Avocados Australia reported a 600% increase in export volumes over three years, reaching 21,979 tons and accounting for nearly 15% of the nation's total avocado production. Yet, with a record 150,912 tons produced this year, there's a push towards expanding export markets further.
The global demand for avocados is on the rise, with forecasts suggesting avocados could become the most traded tropical fruit by 2030. Australian avocado exports to India have recently commenced, and efforts are underway to gain access to the Chinese market, identified as Asia's largest avocado market with significant potential for Australian growers.
However, not all farmers are expanding their avocado operations. In Far North Queensland, some growers are removing older, less productive trees due to the financial strain caused by falling prices and rising production costs. The industry's rapid expansion has led to prices dropping to as low as $1 per avocado, challenging some farmers' ability to cover costs.
Rabobank analyst Pia Piggott noted that while export markets are crucial for restoring profitability, Australian avocado prices are expected to remain low and volatile due to fluctuating supply levels. Growers and industry stakeholders are thus focused on balancing domestic supply with export opportunities to stabilize the market.
Source: ABC News