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Why the US banning avocados could have a devastating effect on 300,000 jobs in Mexico

By Hugh Fort in Business News, posted February 17, 2022

Mexico is facing huge job losses after a decision from the US Government to halt the import of avocados.

The fruit is Mexico's third most important export product, with the country producing more than a third of the world's avocados.

El Pais reports the country is the biggest producer in the world and a massive 81 per cent of the fruits go to the US.

The exports raised more than $2.8 billion in 2021, which provides 300,000 jobs in the country.

The US Government suspended avocado imports on Friday, February 11, after a report an inspector had received a threatening phone call in the state of Michoacán - the leading producer of the fruit and an area that has suffered greatly from violence from organized crime.

Juan Carlos Anaya, director of the GCMA agricultural consultancy firm, which put together the data, said: “This is a serious problem because it’s a perishable product.

"On average, between 100,000 and 130,000 tons of avocados are produced on a daily basis. These will now have to be sold at a lower price in the domestic market or to a third country."

“Looking for other alternatives will not be easy, and so I believe that the Mexican government must find an agreement with the authorities from the Department of Agriculture and the Embassy so that once the investigation is complete, and the measures that need to be taken are defined, avocado exports can be quickly activated.”

The country produced 2.5 million tons of avocados in 2021, 1.4 million of which were imported.

Mr Anaya added: "It’s our third-biggest product after beer and tequila.”

In 2021, they accounted for $3.4 billion (€2.99 billion) of exports. It’s our third-biggest product after beer and tequila."

The President of Mexico has raised the issue

The severity of the problem has been highlighted as it was raised by Mexico's President Andrés Manuel López Obrador

On Monday, Mexican President Andrés Manuel López Obrador stated that he suspected there was an economic interest behind the ban.

Speaking at a press conference, he said: “We need to see what it is about.

“There are also a lot of economic and political interests here, there is competition, they didn’t want the Mexican avocado to enter the US or predominate due to its quality.”

Mr Anaya continued: “Some, like the president, are speculating that it is a non-tariff barrier to put pressure on issues that we are bringing in relation to the US.

“Some are speaking of this as a way for the US government to put on pressure about the energy law.”