Chilean Markets and Avocado Production
Chile represents one of the strongest economies in Latin America with an average growth of 2.0% over the last three years. Similarly, Chile’s gross domestic product (GDP) of over US$400 billion is divided into 4% agriculture, 33% manufacturing industry, and 63% services. Amongst the country’s main agricultural products are grapes, wine, fish, apples, pears, avocados, onions, wheat, corn, and oats. Chile’s economy is well integrated into the Latin American markets because of its associate status with Mercosur, the South American common market, as well as its full membership within the Pacific Alliance. Along with Colombia, Peru, and Mexico, in 2011 Chile became a founding member of Latin America’s Pacific Alliance, which seeks to integrate these four national economies with Asian markets. Likewise, Chile has standing free trade agreements (FTA) with more than 20 countries, including China, India, South Korea, Mexico, the United States, and the European Union. This article explores the status of avocado markets in Chile.
Chilean Markets and Avocado Production
Avocados are the third largest crop grown in Chile and almost half of the national production is consumed domestically. Over the last several years, Chilean avocado production has increased steadily from 152.000 metric tons in 2014/15 and 175.000 metric tons in 2015/16 to an expected total of 200.000 metric tons during 2016/17. Normally, the bulk of avocado production in Chile takes place between May and August, which is the winter season for the southern hemisphere, because of the favorable temperatures and water availability. Throughout the last decade, the amount of land devoted to avocado cultivation has risen overall. However, the peak years in terms of land cultivation were 2011, 2012, and 2013, when avocado crops surpassed 35.000 hectares. Avocado cultivation mainly takes place in the regions of Valparaiso, Coquimbo, and the Santiago Meropolitan area, all of which are located in the central part of the country.
In terms of preferences, the overwhelming majority of avocados produced in Chile are of the Hass variety. Today, it is estimated that the average Chilean consumes 5 kilograms of avocado annually, which represents an increase of almost 4% when compared to ten years ago. Meanwhile, during 2015, Chile exported over 90.000 metric tons of avocados internationally. The leading markets for Chilean avocados are mainly within the EU, particularly the Netherlands, the Unite Kingdom, and Spain. Nevertheless, other important exports markets include Argentina, the US, and China. For example, during 2015, Chile exported 42.000 metric tons of avocados to the Netherlands for a total value of more than US$66 million as well as 10.688 metric tons to Argentina valued at more than US$23 million.
The peak months for Chilean avocado exports are between October and February, when the monthly export amount averages more than 10.000 metric tons. Meanwhile, the highest exports prices for Chilean avocados usually occur during the months of April and May, when each metric ton sells for approximately US$3.000. Nevertheless, the price in the international markets can vary substantially based on global production and the foreign exchange. Finally, avocado imports into Chile are minimal and they originate, almost exclusively, from Peru.