Avocado farmers reject claims of market manipulation to create shortage

Major avocado producers have rejected claims that they manipulated the market to create a national shortage of the fruit in order to force prices higher.

Former Avocados Australia chief executive and The Avolution operator Antony Allen claimed the shortage had been partially caused by West Australian growers, while Jennie Franceschi, one of WA's largest growers, accused Mr Allen of attempting to force the price higher, according to the Sydney Morning Herald.

The shortage has also been caused by rainfall and bushfires, but demand has continued to be strong, pushing up prices to $4 per fruit in supermarkets, and $7 at smaller retailers. 

But, Jennie Franceschi, an avocado packer and marketer who controls a third of Western Australia's avocado production, said she was placing similar volumes in the market every week - except for new year's week and when it has rained.

She also rejected the claim that West Australian producers artificially pushed down the market price of a 5.5-kilogram tray to $45 before Christmas to encourage sales. 

"No, prices were not pushed down, prices remained the same."

Instead, she accused Allen, also the operator of grower-owned avocado marketing firm The Avolution, of attempting to force the market price higher in the belief that consumers were willing to pay.

"Unlike Mr Allen I have very reasonable volumes to sell and in the 30 years I have been selling fruit I never have and never will price gouge on Christmas week," she said.

In response, Mr Allen, whose Avolution business is based in NSW, Queensland and Victoria, said the market should determine the price and it was his job to ensure growers received a fair amount.

"I did not realise that avocado packing sheds were now responsible for socialist programs determining avocado prices. I was under the misconception that in Australia it was the market place that set prices," he said sarcastically.

"I never tell the market what they have to pay, as the market always determines price. My question is, 'What can you pay?' and then that is the price setting from the market," said Mr Allen who is also the president of the International Avocado Society.

In the midst of the shortage, the wholesale price of an avocado tray has doubled to $80, with one vendor saying he had seen a tray being sold for up to $120.

Despite high retail prices, some shops are enforcing purchase limits. The Gabba Fruit Market in Woolloongabba in Brisbane has imposed a limit of six avocados per person at $5.49 each.

Australia also relies on New Zealand imports, but the rain there has added to this year's supply woes because harvesting in wet weather ruins the fruit.

Industry players believe the supply issues will ease about March, as fruit from Queensland enters the supply chain.