7 April 2008
Mexican Avocados and Trade Restrictions
Avocados are one of the United States’ most popular food products which originate from trees found throughout Mexico and Central America. Because of its geographic location and its strong presence in as a cash crop, a complex production chain accompanies each avocado imported from this region. In particular, Mexican avocados have become a booming import to many countries including the United States. Village Farms and other companies based in the United States have a major part in the process of buying and distributing these imports in much of the country. However, due to the increasing Californian farming of avocados, Mexico’s avocado market has been purposely put into a difficult export situation regarding NAFTA health regulations which were unfairly biased to the United States. Thankfully, after many negotiations between governments, some flow of avocados from Mexico is allowed to enter the country without the stringent health restrictions of the past.
As avocados are becoming more popular in the United States, they are being transformed into an everyday commodity that millions of people purchase from stores each year. In fact, over 43% of American households purchase avocados (Fun Facts). Avocados are used in a variety of dishes, recipes, and are often eaten by themselves; they are a symbol of Mexican culture to many while just being a fun party dip to others. More avocado dips, such as guacamole, are consumed by Americans on Super Bowl Sunday than any other day – except for the Mexican holiday, Cinco de Mayo (David Washburn). The price of avocados in markets throughout the country is generally very reasonable due to the competition between different growers, and the avocado is a commonly purchased commodity, especially in Texas and other states with a high amount of cultural influence from Mexico (Rich Hernandez). In this way, avocados are an easily obtainable fruit that can be consumed for any occasion. As a culture of consumption, it is interesting to see how little society knows about how an avocado is produced and the relevant background information; instead, Americans expect the avocado to be a readily available fruit and trust in either California-grown or Mexican imported avocados to be up to a certain standard. Because of this, Americans are unaware of the intense labor needed to harvest the fruit and the potential of competition lowering labor conditions in Mexico and the United States.
The process of growing, cutting, and importing avocados is a complicated series of events. Avocados are produced in the temperate regions of Mexico, which are in the southern or central portions of the country, such as Michoacan, the nation’s number one growing location (David Washburn). Avocados grow on trees like many other fruits and so production of the fruiting body from raw seeds takes around one decade to begin, meaning that the investment in land for the crop is a huge risk. However, many of the avocados sent from California originally had their start in Mexico; in order to avoid the health restrictions on fruits and to help keep the California avocado industry stable, younger plants are removed from the ground and sold to growers in California. The trees are then replanted and the avocados are shipped to markets throughout the country and abroad (Rich Hernandez). Obviously, the process of raising and then moving trees must be highly labor intensive for any workers involved in this process. Although many young trees are imported to the United States, many of the Mexican avocados come straight from Michoacan and other neighboring areas.
The notable difference between Mexican and Californian avocados is their size; Mexican avocados are considerably smaller than their Californian counterparts, largely due to the growing conditions and the lack of consistent fertilizer in Mexico. As well there are many different types of avocados that each grower promotes, including Hass, Colvalo, and companies such as Village Farms which purchase avocados from a mixture of growers (Rich Hernandez). The avocados are harvested by hand with a long pair of sheers called clippers and put in bins to be moved to storage by a forklift. After this, the avocados are sorted by size and quality by workers called graders. Then, they are moved into shipping-ready containers called lugs and again checked for quality. From this stage, they are shipped to their appropriate markets, usually in refrigerated trucks (Seedling to Supermarket). In this particular case, freight trains are used for the initial transport into the United States (Rich Hernandez).
Understanding the history of the fruit is essential to knowing how the market for the avocado developed into the cash crop that it is today. The first contact that Europeans had with the fruit came through the travels by Spanish Conquistadors in the 1500’s. Immediately, the fruit was well received and cultivation of the crop continued to grow as it became engrained in Native and Mexican culture. As the crop gained more prominence in the diets of people in Mexico, entrepreneurs from the United States began importing the plant to California in the later 1800’s because of its temperate climate all year round (History). From here, the market expanded exponentially as the demand for the fruit continued to rise. Although Mexico continued to produce the fruit, California’s organization as a farming community was much more focused on the consumer culture of the United States and was able to take over most of the market. Overall, this led to the current distribution between the United States and Mexico with 67 and 15 percent of the total production of avocados globally, respectively (Lamb 5).
Unfortunately, due to the lack of a focus on health concerns for Mexican-grown plants in the early 20th century, Mexico has been relatively unsuccessful until recent years at breaking into the exponentially growing marketplace for avocado exports. To Mexico’s credit, “[p]roduction of export-quality avocados has been increasing in Mexico over the past few decades and Mexico would like to enter the restricted U.S. market, which is large, typically generating sales around $250 to $300 million annually. While sales of Mexican avocados in the United States have increased recently, they remain less than 7 percent of total consumption, and less than 20 percent of imports” (Lamb 5). The restrictions placed upon Mexico have generally been imposed by NAFTA through the use of sanitary and phytosanitary (SPS) standards. Essentially, these standards are loosely worded clauses which give the receiving country the power to ensure the safety of human life by not accepting imports of foreign products (Lamb 3). In this case, the United States is able to enforce any standards that they deem fit; by using particularly high standards, the United States was able to protect growers in California through the refusal to let Mexican avocado growers have a portion of the lucrative market across the border. The California growers’ tactics have “involve[d] the investment of resources into lobbying and other strategic actions to effectively buy government regulations that give monopoly privileges” (Lamb 7). Ultimately, an entire century has been exclusively dominated by companies in the United States who wants to control the avocado market to be able to set high prices by being the only producer able to sell their product regardless of its impact on the Mexican economy.
Through the combined efforts of Mexican growers’ protests to the United States and Mexican government, the strict standards imposed on avocado growers are being lightened which is rapidly transforming the avocado industry into a booming cash crop in Mexico. According to Marisol Rueda, a commentator on Latin trade, the fruit is now considered to be “green gold”. Rueda said the initial change came in 2004 when the United States allowed for limited importation of avocados into the country from the Michoacan region. As of now, even California is not off limits to avocado import. Currently, the Michoacan region is exporting almost 100% of the avocados used in the Japanese market, but more important markets like the United States are now able to be tapped into as well. Rueda speculates that because of the new trade freedom, the export level from avocados may skyrocket from around 40,000 tons to over 300,000 tons in the coming years. As a direct result, California’s growing community is worried that the impact of free trade will lead to the economy of the state being severely damaged, as well as starting a price war with Mexican avocado producers. In previous import surges, the prices of avocados dropped from 1.05 USD per pound to only .65 USD per pound (David Washburn). Yet, despite this fear, the hope is that Mexican avocado producers will expand the market further in the United States and the two countries will be able to help cover the demand. The chairman of the California Avocado Commission, Scott McIntyre feels that “[Mexico and the United States] can play together [because] there is enough [of a market] for both sides” (David Washburn).
Even though Mexican avocado standards have been raised, many Californian growers are still worried about the potential for disease and pests coming from the Michoacan region. Rayne Thompson, the California Farm Bureau Federation (CFBF) foreign affairs director, states that the ban is not about competition and he uses the example of Chile which is importing over 200 million pounds of avocados each year into the country. Rather, he cites that “[i]n December 2002, an infestation of the Mexican fruit fly resulted in a quarantine of nearly 75,000 acres of avocado groves in San Diego County. In 2003/04 it cost the state and federal government $24 million to eradicate and quarantine the Mexican fruit fly”. While Thompson is set against the move, it would appear that Mexican growers are still getting more freedom to import their products to the United States with fewer limitations than any other time in the history of the Mexican avocado market.
In terms of labor, the avocado production process is almost exclusively dominated by Mexican workers; in California, along with the rest of the agriculture industry in the United States, these people are migrant workers who will work for less pay doing highly labor intensive jobs, such as the clipping of the avocados from the tree (Ed Stoddard). William Kandel, a sociologist working with the U.S. Department of Agriculture's Economic Research Service, estimates that from 700,000 to 1,400,000 migrant laborers work on farms every year in the United States (Ed Stoddard). Of course, Mexican workers in Michoacan work for an even smaller amount of money for the same labor intensive process due to the state of the Mexican economy and its labor policies. As well, avocados are a year-round crop so labor does not have any off season as other crops do.
Almost exclusively, labor in this sector comes from unskilled, rural peasants because they will work for reduced pay. In a recent Trade & Environment Database article concerning the avocado trade dispute, the research concluded that “Mexican costs are lower because of the wage gap between farm workers in the richer United States and those in the more impoverished Michoacan region of Mexico” (Mexico-U.S. Avocado Trade Dispute). Overall, this means that the workers are probably given very little pay to support themselves and their families, a factor which probably influences the desire for many Mexicans to become migrant workers in places like California.
Further, it has yet to be seen what the price competitions of Mexican avocados in the United States market will do to the laborers who will probably be at the mercy of falling company profits if avocado demand becomes skewed. Pending the results of increased trade, the avocado economy in Mexico may create more jobs and improve labor conditions through the amount of money flowing into the country. On the other hand, the price wars could drive the price of avocados so low that workers will have to suffer pay cuts on their already low salary. Sadly, labor unions have little support to improve conditions for these workers, although several do exist. The Farm Labor Organizing Committee (FLOC) has attempted to help workers throughout the southern United States and Mexico, but attacks on union activity has inhibited organization on a larger scale. In fact, one organizer was killed while in northern Mexico and their office was burglarized several times (James Parks). Because of these setbacks and the little coverage that American media gives the working conditions of the rural labor force, the voice of the Mexican farm worker is essentially silent.
Currently, the Mexican economy is thriving in the avocado-producing regions of Mexico. Due to the relaxation of a century of trade restrictions, avocados will continue to be a major export into the United States. While Mexican workers are likely to be exploited for their cheap labor by major American companies, our culture continues to consume vast amounts of this iconic fruit each year without much regard for the difficult process of growing, harvesting, and shipping avocados.
Fun Facts. 2008. California Avocado Commission. 3 Apr. 2008. .
Hernandez, Rich. Telephone interview. 4 Apr. 2008.
History. 2008. California Avocado Commission. 3 Apr. 2008. .
Lamb, Russell L. "RENT SEEKING IN U.S.-MEXICAN AVOCADO TRADE." CATO Journal 26.1 (Winter 2006): 159-177. Academic Search Complete. EBSCO. Trinity University, San Antonio, TX. 3 Apr. 2008 .
Mexico-U.S. Avocado Trade Dispute. May 1997. Trade & Environment Database. 3 Apr. 2008. < http://www.american.edu/TED/avocado.htm>.
Parks, James. FLOC Organizer Beaten to Death in Mexico. 10 Apr. 2007. AFL-CIO Weblog. 3 Apr. 2008. < http://blog.aflcio.org/2007/04/10/floc-organizer-beaten-to-death-in-mexico>.
Rueda, Marisol. "Green gold: Mexican avocados take off, thanks to increasing consumption and exports". Latin Trade. Mar. 2005. FindArticles.com. 03 Apr. 2008. .
Seedling to Supermarket. 2008. California Avocado Commission. 3 Apr. 2008. .
Stoddard, Ed. Agriculture Dependent on Migrant Workers. 23 Jul. 2007. Reuters. 3 Apr. 2008. .
Thompson, Rayne. Mexican Avocado Imports Pose Serious Pest/Disease Threat. 4 Aug. 2004. California Farm Bureau Federation. 3 Apr. 2008. .
Washburn, David. Mexico’s Avocado Impact. 12 Feb. 2005. Union-Tribune Publishing Co. 3 Apr. 2008. < http://www.signonsandiego.com/news/business/20050212-9999-1b12avocado.html>.