First shipment from Australia
First shipment from Australia

Australia’s avocado trade is poised to become a lucrative new business opportunity for Indian fruit traders looking to diversify product range and market reach.

The first lot, out of 10 trial shipments prior to providing full market access, arrived in Mumbai last week.

The trial plans were announced in April, following tariff duty reductions under the framework of a free trade agreement (FTA) the two countries set up last year for bilateral trade expansion.

Avolution exported 176 cartons of premium avocados on behalf of Mumbai-based dealer IG International. Representing some 120 growers, Avolution is said to be the largest exporter out of Australia for this produce.

“We believe the introduction of Australian avocados will greatly enhance the culinary experiences of Indian consumers and contribute to the growth of the fresh produce industry in India,” Shubha Rawal, director of sourcing and marketing at IG, told The Loadstar.

IG believes Indian consumers will develop an appetite for Australian avocados and hopes to cash in on that. Ms Rawal added: “Avocados have gained immense popularity in recent years.”

Securing access to the Indian market is a big boost to Australian avocado growers and suppliers, as they have been grappling with a considerable glut in supply after mass plantings in anticipation of a demand boom.

According to available data, between 2010/11 and 2021/22, Australian avocado production jumped from 34,000 tonnes to 122,000 tonnes, and exports comprised just 3,155 tonnes of the 78,085 tonnes produced during 2010/11. Mexico and Peru are the global market leaders in avocado exports.

After New Delhi green-lit market access with tariff cuts, John Tyas, CEO at Avocados Australia, said: “If we can get 1% of [India’s] people to buy Australian avocados, that’s a market of 15 million.”

Indian avocado imports have mostly come from New Zealand, the EU and Peru, because of their most favoured nation (MFN) import tariff advantages. With the FTA, tariffs on Australian avocados are now at par, 30%, dropping sequentially to zero by 2029, which is critical to growing demand in a highly price-sensitive market like India.

Indian perishables importers are also expected to benefit from substantially lower sea-air freight rates. Avocado shipments have been sent by air, but according to Austrade, growers from Western Australia and Queensland are trying ocean reefer containers to South-East Asia and Japan in a 20-30-day journey. Average ocean freight rates from Melbourne to Nhava Sheva/Mundra are hovering at $2,000 per teu and $3,300 per feu, according to market sources.

Australian avocados will be allowed full access into the Indian market once the trial shipments have been found to meet local biosecurity and other food import guidelines.

The India-Australia FTA aims to boost two-way trade to some $50bn in five years from the current $30bn.  Riding on this, ocean carriers have opened new connections on the route.

Indian goods also have significant reciprocal tariff duty advantages in Australia, with the apparel industry seen as a major beneficiary.

You can contact the writer at [email protected].

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