The Real Economics of Avocado Toast — Stan NormThe real economics of avocado toast is the impact the popularity of the fruit has had on the primary economies which contribute to its production. Mexico today accounts for around 45% of the world’s avocado supply — 87% of which comes from the Michoacán area of the country. However, this newfound source of agricultural wealth has attracted the attention of the major cartels resulting in a new and real threat to the farmers of the region.
The Rise in Consumer Demand
The demand for avocado’s has been driven primarily by the US consumer market and the history of how avocado came to be a staple diet is essential to understanding the current avocado market trend.
Behind this remarkable phenomenon are cultural and social factors. The rapid growth in the Hispanic population in California lead to a burgeoning of Mexican restaurants that serve dishes featuring avocados.

The adoption of Haas Avocado from Mexico into the commercial market allowed mass production. The Haas cultivar ripe slowly and its thick bumpy skin allows a longer shelf life compared to other fickle varieties.
Most importantly, marketing Avocados’ health benefits successfully targeted the rising health-conscious consumers who then adopted avocado as an everyday diet.
In the 1990s, a lift in the ban for Mexican products allowed a surge of Mexican avocados into the American market. The number soared in 2007 when Mexican avocados were allowed full access to the American market.
Mexican Avocado Trading Corridor (Courtesy Tridge.com)
In the 1990s, an average American consumed 1.5 pounds a year. In 2007, the number increased to 5 pounds. EU consumption is just below 1kg per capita, which is 150 times greater compared to a decade ago.
Tridge has an unmistakably comprehensive database and article that elaborate further on the details behind the demand driven phenomena.
Mexican Supply
The primary habitable conditions for the plant continue to be the Mexican state of Michoacán since its early originations. The state accounts for 92% of the country’s overall production, the primary export market for the produce being the United States.

While the list of global producers (highlighted in green) are now several and far dispersed — the Mexican economy does control the single largest share of total avocado supply.

The Cartels
The Mexican newspaper Reforma reported late last year that organized crime cells had obtained agriculture ministry records of avocado producers in the early 1990s and have used the data to track down farmers, especially in the Michoacán region. They force them to pay a percentage of their earnings or risk kidnapping or death.
The office of the country’s attorney general has stated that:
“This was a system of intelligence that involved reviewing records from the agriculture ministry to know who the farmers with ample avocado production were, where their orchards were located, and how much they reported their sales by export…The avocado producers were imposed a quota and those that resisted, or the families of those, were kidnapped or murdered as pressure until they ceded.”
According to Reforma, the whole scheme was started by Jalisco Nueva Generacion cartel and Los Cuinis — a criminal group led by Abigael Gonzalez Valencia. The group was once called the richest cartel in Mexico, and the avocado scheme was seen as an alternative form of income to trafficking.
Eventually other drug cartels, such as the Knights Templar and the Michoacana Family began copying the strategy, Reforma reported.
The practice has quickly became profitable for cartels, who charge upwards of $100 per hectare and 10 cents per pounds of avocado sold. The farmers have to sell their produce at a higher price to make ends meet.

The increased consumption of avocado in the United States over the past five years has been a boon for the industry, with Mexico supplying up to 82% of US demand.
The USDA reported that Mexican avocado exports have gone up 400 percent since 2005, resulting in more than $2.2 billion in profits last year.
However, given the increasingly violent conditions surrounding the Mexican state’s main production facilities, the US State Department has issued its highest travel advisory warning to citizens against visiting the Michoacán region.
Local Resistance
Resistance though is forming in unlikely ways. The town of Tancitaro, a small farming enclave of about 30,000 in western Michoacan state is leading the fight against the organised crime syndicates. In late 2013, Tancitaro’s residents, like many towns throughout Michoacán, took up arms, forming self-defense groups to drive the gangs out.
Police officers of Tancitaro’s 80-member force gather before going out on patrol
The new force is equipped with armored patrol trucks, and each officers wears full combat gear, including bullet proof vests, helmets and high-power rifles — all provided for by the state police.
Their salaries come in part from local avocado growers and packers, who wield much power and influence over the town. The other half comes from city coffers.
The mayor said crime has fallen since the community and police joined forces, although he said there were no current statistics available for the town.
Originally published at standardnormalpost.com on September 5, 2018.
