For better or for worse, I seem to have acquired a reputation as the go-to guy regarding the price of trendy foods. So a few weeks ago, I talked to Bloomberg reporter Kyle Stock about the price of avocados. Here is the article that he wrote, which also features insights from my Purdue colleague David Widmar.
This is what I had to say:
When a new tree is planted, it won’t bear much fruit until its third year. At the moment, that stings consumers. Supply can’t catch up with demand in a manner of months, as it can with a product such as the tomato. All the while, though, farmers are watching the price, ready to plant where they can and cash in. This fall’s expensive avocados may trigger a glut in two or three years. That’s what happened with quinoa in 2015, according to Bellemare. After doubling to record highs, prices for the trendy grain swooned.
“When you see this kind of crazy demand, there are a lot of people sitting on the margins that decide to get in and plant,” he said. “Eventually, all those extra-normal profits get competed away.”
In the process of preparing for my call with Kyle, I read a whole bunch about avocados, as they were a commodity I knew little about.