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News / Life / Food

The rise and rise of avocados in U.S. market

Fruit keeps getting more popular despite expense

By Jonathan Roeder and Leslie Patton, Jonathan Roeder and Leslie Patton, Bloomberg News
Published: September 8, 2023, 6:30am
2 Photos
View of avocados packed for export Feb. 10 at the Los Cerritos avocado group ranch in Ciudad Guzman, state of Jalisco, Mexico.
View of avocados packed for export Feb. 10 at the Los Cerritos avocado group ranch in Ciudad Guzman, state of Jalisco, Mexico. (Ulises Ruiz/AFP) Photo Gallery

Avocados’ rise to stardom in the U.S. may seem improbable: It’s a relatively expensive fruit that’s delicate and has a limited shelf life.

That’s proven little obstacle, however, as avocados’ popularity is only growing. U.S. imports of fresh Hass avocados from Mexico climbed to $2.7 billion last year, up about 38 percent from 2018, according to data from the U.S. Department of Agriculture. In the fiscal year ended in June, Mexico exported nearly 2.5 billion pounds of the fruit — a record high. It’s a testament to the enduring appeal of guacamole and avocado toast — and an unorthodox arrangement between Mexican growers and packers and U.S. importers.

Avocados From Mexico, created about 10 years ago to market the fruit to U.S. consumers, works with companies including Potbelly Corp., Walmart Inc. and Chipotle Mexican Grill Inc. to get more avocados into restaurants and onto dinner tables. It buys up Super Bowl ads, operates a kitchen to test new recipes and created a jingle that’s gotten stuck in everyone’s head. The group’s chief executive officer, Álvaro Luque, recently sat down with Bloomberg News to talk about growing seasons, inflation and how he plans to get avocados into more sandwiches, tacos — and even brownies.

What is Avocados From Mexico?

The reality is that we are not from Mexico and we don’t sell avocados. We’re 100 percent an American marketing company that was built to do two things: To create a brand for Mexican avocados and to accelerate demand for avocados in the U.S.

How is the brand doing?

We’ve been creating a brand in a brandless world. You don’t wake up every morning saying, I’m going to go and buy my favorite brand of celery. But we’ve been trying to build up excitement around the commodity. We now have eight Super Bowl advertisements under our belt. And now more than 60 percent of consumers prefer avocados from Mexico. That was very low at the beginning when we started.

Where do you see growth coming?

Right now, food service represents like 30 percent of the volume of avocados in the U.S. But the opportunity is huge.

Being a Mexican-based product, you would imagine that our penetration in tacos in the U.S. is huge. And our numbers say that we have only 2 percent penetration in tacos. So 98 percent of the tacos being served in this country don’t carry avocado.

Bowls represent probably the biggest opportunity out there. The great thing about bowls is that they cross over cuisines. You can have an Indian bowl, a Mediterranean bowl, an American bowl, a Mexican bowl — and all of them can have avocado. So we’re pushing that big time. But the other one that we’re seeing good traction in is beverages. So smoothies, cocktails.

What about desserts?

We haven’t pushed desserts a lot, but we play with it because it’s a nice story to have. Just go to your favorite recipe of brownies and substitute 100 percent of the butter that you use in your brownies with avocados, and it will work. Unless you like the fluffy kind, then I would say 75 percent. You won’t feel the flavor of our avocados. You won’t see the color of our avocados coming through. But you’ll have all the healthiness of a healthy fat.

While the U.S. gets most of its avocados from Mexico, it also imports the fruit from Peru, Colombia, the Dominican Republic and other countries. Chipotle said last quarter that for the first time, it sourced the majority of its avocados from Peru. Is avocado competition on the rise?

Peruvian avocados are here in the market in July, August, September. So this is their timeframe. We still own 60 percent of the market.

Every country that produces Hass avocados has the same tree. But in every other part of the world where they produce avocados, they only have one crop. That’s why California avocados are in the market only from March to August. But Michoacán, Mexico, is the only place on planet Earth that will give you four blooms instead of one. So that’s why Mexico is unstoppable, because Mexico will have fruit from January to December nonstop.

In the 12 months through July 29, U.S. retailers sold about $2.7 billion worth of avocados, according to researcher NIQ.

Are you concerned that consumption could decline as high levels of inflation erode shoppers’ purchasing power?

So avocados have this idea that you can have taste, fun and health at the same time. And it’s not very common to have that trifecta. We have that ability of playing a little bit better during inflation than other foods.