Calavo Growers Inc (Nasdaq-GS: CVGW) has completed a previously reported expansion of fresh avocado packing operations at its Uruapan, Michoacán, Mexico, facility to keep pace with consumer demand in that produce category.
The company, a global avocado provider and an expanding supplier of fresh food, said the upgrades give Calavo’s Uruapan packinghouse the capacity to pack at least six million pounds of fruit per week—a 200% increase over prior output. Translating to about 300 million pounds per year, the stepped-up production capability in Mexico brings it in line with Calavo’s California packinghouses for a total company capacity of approximately 600 million pounds per year, according to Lee E Cole, chairman, president, and chief executive officer.
“Consumer demand for fresh avocados continues to grow at a quickening pace,” said Cole, “with per capita consumption heading from four to five pounds annually. In the past decade or so alone, that figure has risen from a mere two pounds.”
He said industry estimates forecast 2013 US avocado consumption of at least 1.65 billion pounds, an increase of more than 17% from the expected 2012 purchases and about 47% over 2011 consumption.
“With the anticipated uptick in supply and our expanded capacity, Calavo is well-positioned to handle this increased volume. Further, the capital investment in Uruapan reflects a new Calavo focus on expanding its market-leading position in the fast-growth fresh avocado segment,” he said.
The Uruapan packinghouse became fully operational August 1 at stepped-up production levels, Cole said.
Besides increasing the facility’s total square footage by nearly 75%, specific enhancements include larger, faster equipment for grading, sizing, and packing that is both quiet and safe. The company also installed larger coolers to keep pace with increased production, improving Calavo’s already strict cold-chain protocols. Those cooling modifications are expected to further fine-tune the company’s standards of ripening and consumer-bagged avocados for the North American retail and foodservice markets.