Avocados have become nearly ubiquitous in American society, served at fast-food outlets and fine dining alike as demand grows. The U.S. Department of Agriculture reports that U.S. avocado consumption has more than tripled since 2001.
The seeds of that growth are firmly planted in Mexico.
The USDA reports that about 90% of all avocados eaten in the U.S. come from Mexico, totaling an estimated $2.7 billion in imports for 2024.
U.S. production is concentrated in California, which accounts for around 90% of domestic production, according to the California Avocado Commission. Hawaii and Florida make up the rest. But California's industry only meets a fraction of the immense demand.
"We're just a teeny-tiny player now in the big picture," said Mary Lu Arpaia, a subtropical horticulture extension specialist at the University of California, Riverside.
California's avocado production peaked in the early 2000s and has fallen in both production acreage and yield since, according to the CAC.
"The cost of production here in California is very, very high," said Arpaia. "We have resource limitations on water availability and water quality. ... Real estate is very expensive."
Money Report
The problem isn't unique to avocados: U.S. agriculture production as a whole has been shrinking. The USDA reports that imports are exceeding exports for the first time in history.
"Mexico will almost always be an efficient, low-cost producer," said Richard Sexton, a professor of agricultural and resource economics at the University of California, Davis.
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More than 80% of Mexico's avocado exports go to the U.S., and its industry is still growing. In 2022, Jalisco became the second Mexican state to meet certain requirements allowing it to trade its avocados with the U.S., opening up more opportunities for other farms and additional fruit to flood the market.
Watch the video to learn more.
