Price Dispute Halts Shipments of Coveted Mexican Avocados

(Bloomberg) -- A price dispute between producers in Michoacan, the heartland of Mexican avocado production, and packing companies has brought exports of the coveted green fruit to a halt.

Growers ceased harvesting last week and now shipments to Mexico’s three top avocado buyers -- the U.S., Canada, and Japan -- have been suspended, according to daily newspaper Reforma. The interruption has already hurt deliveries to U.S. retailers like North Carolina-based Food Lion, which runs supermarkets in 10 U.S. states, and the Firehouse Subs chain. Neither company immediately provided comment.

The conflict entered its second week as producers seek a minimum price range of 17 to 20 pesos (84 to 99 cents) a kilo.

APEAM, the association that groups producers and packers, says it’s nearly impossible to set a price range. The average price of avocados in Michoacan is currently 10 to 12 pesos a kilo, which according to the association, leaves a “good” margin for producers.

The country should produce about 2.05 million tons this year, with close to 60 percent of that shipped abroad, according to Mexican government agricultural projections. By 2024, production is expected to rise to 2.61 million tons.

Avocado, once mainly confined to dips and salads, is now seen as a super-food thanks to its nutritional characteristics and smooth texture. Some people even eat their pits roasted.

--With assistance from Rafael Gayol.

To contact the reporter on this story: Cyntia Barrera Diaz in Mexico City at cbarrerad@bloomberg.net

To contact the editors responsible for this story: Giulia Camillo at gcamillo@bloomberg.net, Dale Quinn, James Attwood

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