The great avocado price squeeze began earlier this year and has since sent prices to record highs. Surely anyone who has been to the supermarket, ordered groceries online, or even added an extra topping of avocados on a burrito bowl at Chipotle has been shocked by prices.
Since the start of the year, the price of a 20-pound box of avocados from the state of Michoacan, Mexico (the central hub of Mexican avocado production), has risen from $20 to now $50, a mind-numbing 150% jump in the first five months of the year.
Prices for this time of year are the highest, dating back 24 years of data via Bloomberg. A seasonal price peak tends to be in late July, so there could be more upside in prices into summer.
The reason for such a dramatic rise in prices was explained by Pamela Diaz Loubet, a Mexico City-based economist at BNP Paribas, who told Bloomberg, "Avocado prices have been exacerbated by supply-side factors such as the increase in fertilizer prices."
Our past reportings have detailed some of the events that have led to soaring prices, including the temporary suspension of all imports of Mexican avocados in early February, production declines, and the cost of soaring fertilizer, diesel, and freight have all led to rising prices.
- USDA Suspends Mexican Avocado Imports, Stokes Yet More Food Inflation
- Chipotle On Brink Of Guacamole Shortage After US Bans Mexican Avocados
- Avocado Prices Rocket To Decade High As Mexican Production Set To Plunge
Now comes the point at what price will demand destruction emerge. It will be tough for millennials to give up avocado and toast.