The rules, which were given the green light by the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service on August 14, include a series of regulations designed to ensure sanitation standards and minimize the risk of introducing pests into the United States, including the avocado seed weevil, pink hibiscus mealybug, and avocado seed moth.

The U.S. avocado market has grown astronomically in recent years. In 2016, the country imported 2.2 billion pounds of avocados — double the amount in 2011.

In an interview with Finance Colombia, William Wepsala, a spokesman for the USDA’s Animal and Plant Health Inspection Service, confirmed that the rules have gone into effect and that permits are expected to take around 30 days to process. “That means that Colombian growers will then be able to apply for permits to import into the United States,” said Wepsala. “The permits will verify that the growers are in compliance with the rules.”

Though the rules are in place, Colombia growers won’t likely be able to take a significant bite out of the U.S. market this year, according to Esteban Meneses, director of supply and certification at Hass Colombia, an association of Hass avocado growers based in the Colombian department of Antioquia that represents more than 50 growers whose main export markets include the Netherlands, United Kingdom, and Scandinavian countries.

“It’s probable that this year we’ll be sending some sample containers [to the United States],” Meneses told Finance Colombia. “But it will probably be two years before we see shipments on a regular basis.”

The Logistics of Exporting Avocados

The agreement to allow Colombian avocados into the United States, following a lengthy formal clearance process that began last year, was officially confirmed by U.S. Vice President Mike Pence during his visit to Cartagena last month. The news was a long time coming: Pence’s announcement was the culmination of more than 10 years of agricultural negotiations between the two countries, MinCIT said in a statement.

Colombian growers who wish to export to the United States must register with the Colombian Agricultural Institute (ICA), the department of the Colombian Ministry of Agriculture charged with ensuring compliance with the export agreement. Currently, 58 producers of Hass avocados, by far the most popular variety consumed in the enormous U.S. market, are registered with ICA, according to the Ministry of Ministry of Commerce, Industry, and Tourism (MinCIT).

ICA representatives must inspect avocado production areas and packing facilities monthly, starting “at least two months before harvest and continuing until the end of the shipping season,” according to the regulations. The packing facilities are required to package the fruit in insect-proof packaging within 24 hours of being harvested. If a facility is an area of the country that has not been declared free of pests, it must have a one kilometer “buffer zone” around its perimeter. ICA must then monitor and take samples in the facility and buffer zone to ensure no pests are present.

Avocados as an Agricultural Boom for Colombia

The move by Washington to allows imports from Colombia has been touted as a win/win scenario for Colombian growers and U.S. consumers.

The Colombian government, which passed a revised peace accord with the Revolutionary Armed Forces of Colombia (FARC) in December that ended 52 years of conflict, is looking to ramp up agricultural production in the country’s new “post-conflict” era.

“It’s probable that this year we’ll be sending some sample containers [to the United States]. But it will probably be two years before we see shipments on a regular basis.” – Esteban Meneses of Hass Colombia

The idea is that rural areas long plagued by violence and lacking development will now find new levels of stability and farmers can lead an agribusiness boom.

President Juan Manuel Santos believes that avocado farming can create “thousands of jobs.” In December, during an address in front of the Food and Agriculture Organization of the United Nations, the Colombian head of state said that peace “benefits the world on many fronts, and one of them is food security and agricultural development.”

He added that, “our countryside also was a victim of the armed conflict that diminished productivity in the rural sector, increased the social gap with urban areas, and deepened the iniquities in our country.”

The U.S. market for avocados dwarfs every that of other country, and its rapid growth shows little sign of stopping. If Colombian growers can export avocados to the United States in large quantities, the economic potential is vast. (Chart via USDA)

Competing with Mexican Avocados

The United States, on the other hand, estimates that injecting Colombian avocados into the market could stabilize or lower prices if the volume is high enough. Currently, Mexico dominates the U.S. market, providing 77% of the avocado supply in 2016, according to the Hass Avocado Board, a California-based group that promotes and tracks the consumption of Hass avocados in the country. Much of the rest of the U.S. supply comes from California.

Combined, according to data from the Hass Avocado Board, Mexico and California were responsible for 93% of the U.S. avocado supply in 2016. This is largest percentage seen in recent years as the trend of only having two supply sources has continued to grow as imports from Chile have waned. In 2011, for example, Mexico and California combined for 84.5%, but that number was just 75% inIn 2007, with Chile supplying 24%.

Avocado producers in Mexico also have become increasingly dependent on U.S. consumption. Nearly 77% of the country’s avocado exports went to the United States in 2016 — up from 30% in 2002, according to data from the Mexican Secretariat of Economy.

But in 2016, a drop in supply due to a growers’ strike in Mexico, compounded by drought and reduced yields in California caused prices to spike. The cost of a single avocado reached $1.44 USD during the third quarter of last year. The average price between September and November was $1.25 USD — some 22% higher than the costs seen during the rest of the year.

Though the surge has since eased, the price of non-organic Hass avocados jumped again this year, rising from $0.89 USD per avocado to $1.17 USD between January and June of this year.

Peace “benefits the world on many fronts, and one of them is food security and agricultural development.” – Colombian President Juan Manuel Santos

The USDA estimates that Colombian avocados could lower prices. “Colombia is expected to export between 8,000 to 12,000 metric tons of fresh Hass avocado fruit, with 10,000 metric tons being most likely,” stated the USDA Animal and Plant Health Inspection Service. “If the United States were to import between 10,000 and 12,000 metric tons of fresh Hass avocado fruit, considering a 20% displacement of fresh Hass avocado fruit imports from other sources, the decline in avocado prices may range from 1% to 1.5%.”

The Market for Colombian Avocados Is Global

Though bringing the massive U.S. market into the fold could be an unprecedented boon for Colombian growers, many other countries are already ramping up their imports.

Colombia has seen its annual avocado exports skyrocket in recent years, from a paltry $5,700 USD in 2007 to over $35 million USD in 2016, according to data obtained from ProColombia, a government organization that promotes exports and foreign investment. And the trend continues: Avocado exports also increased 9.9% during the first quarter of 2017 compared to the same period in 2016.

Currently, the Netherlands is the top destination for Colombian avocados, representing 40% of all exports of the fruit in 2016. Though it is a fraction of the colossal U.S. market, the Netherlands was the second-largest importer of avocados in the world in 2016, according to Statistics Netherlands, a department within the Dutch Ministry of Economic Affairs.

The Netherlands, however, is primarily a “re-export” market, meaning that the Dutch turn around and export much of the fruit to other European countries. Of the 185 million kilograms of avocados the Dutch imported in 2016, nearly 79% were re-exported, according to Statistics Netherlands. The top destinations for the re-exported avocados are Germany, France, and Scandinavia. Colombia was tied with Israel as the eighth largest exporter of avocados to the Netherlands in 2016.

Capitalizing on the Avocado Craze

Though Colombian growers have doubled the volume of avocados exported to the Netherlands every year since 2013, the U.S. market has proven elusive for Colombian growers. Only four avocado shipments were sent to its North American ally between January 2007 and March 2017, according to data collected from shipping manifests.

The U.S. market has grown astronomically in recent years. In 2016, the country imported 2.2 billion pounds of avocados — double the amount in 2011, according to the Hass Avocado Board.

The average U.S. consumes nearly seven pounds of avocados in a given year, according to the Agricultural Resource Marketing Center. The rise of guacamole as a snack staple has helped spur the jump in consumption, with the Hass Avocado Board estimating that 104.9 million pounds of avocados were consumed this year on Super Bowl Sunday alone.

The market has also grown due to the supposed health benefits of avocados, a fruit that has been branded as a “superfood” by some. The U.S. National Library of Medicine says preliminary data shows that the fruit’s properties and nutrients could help reduce the risk of cancer and heart disease.

The Hass Avocado Board estimates that 104.9 million pounds of avocados were consumed this year on Super Bowl Sunday alone.

But the avocado craze is not limited to the United States. Earlier this year, an avocado-based restaurant opened in Amsterdam, featuring a €15 burger with “avocado buns” and an avocado and chocolate smoothie.

Apparently, there are some downsides. In the United Kingdom, the growth in popularity has reportedly led to an increase in people injuring themselves attempting to cut open the fruit with a knife, according to the British Association of Plastic Reconstructive and Aesthetic Surgery (BAPRAS). Plastic surgeon Simon Eccles told the BBC in May that he treats “about four patients a week” in London for avocado-related injuries. His staff now even has a name for the wound: avocado hand.

“While BAPRAS hasn’t specifically called for safety labels on avocados, we are naturally concerned about the increasing number of avocado-related injuries recorded and would like to remind people to take a common sense approach to avoid injuries,” the organization said in a statement.

Whatever the reason for the avocado craze, the Colombian government is striving to put Colombian avocados on dinner tables around the world. And officials have now overcome the biggest hurdle in clearing the red tape to enter the U.S. market.

Now, it will be up to avocado growers in Colombia to expand production. If successful, they can become the earliest success story in the country’s hope for a post-conflict agro-boom and at the same time help feed the seemingly insatiable avocado consumers in the United States.

The news came amid an avocado shortage in the country that was causing prices to spike, and the main hurdle to entry was logistical. Authorities needed to ensure that potentially dangerous pests would not follow Colombian avocados northward and introduce blight in the United States. The USDA’s original analysis, for example, noted the need for Colombia to upgrade certain procedural and monitoring safeguards within its growing and supply chain.

Bu this week, the USDA, through its Animal and Plant Health Inspection Service (APHIS) agency, announced that it overstated that fear due to what seems to be a clerical error. A more recent risk assessment has revealed that the perceived threat presented by a pest called the pink hibiscus mealybug was unfounded.

“We have subsequently determined that growing conditions for Hass avocados in Colombia, as well as the standard packinghouse practices used to prepare the fruit for commercial export, effectively preclude the pink hibiscus mealybug from following the pathway from Colombia to the continental United States,” said APHIS in a statement.

The confusion came from the fact that the original pest risk assessment released “was not the latest iteration that had been prepared,” said APHIS.

In short, Colombia’s safeguards to prevent this pest are already sufficiently stringent and this was known by officials in October. But the paperwork included in the document reflected outdated info.

So with this realization, the agency has now reopened the comment period that will precede its plan to propose the legal change that will allow Colombian Hass avocados into the United States. While some barriers may still remain, the fact that there is no significant pink hibiscus mealybug risk could streamline the implementation requirements on Colombia’s end before farmers there can begin exporting their avocados to the world’s largest market.

The inclusion of misinformation in the original report, however, has likely delayed the process to some degree. The reopened comment period will now last until February 26, said APHIS. The original comment period, which was opened on October 27, was set to close on December 28.

The first steps made towards allowing the import of Colombian avocados came during a time of shortage. This was largely due to a growers’ strike in Mexico, which produces the bulk of avocados eaten north of the border. Low harvest yields in California also exacerbated the problem and led to a price surge throughout the United States. “We’re seeing fruit out there at double the price it normally would be,” Cythnia Guzman of California-based distributor Nature’s Produce, told CNBC in October.

Though the crisis has eased in the ensuing months, the hunger for avocados has continued to grow in recent years. And at the current rate of demand increase, Mexico and California likely cannot keep up. Nearly 2.2 billion pounds of Hass avocados were shipped in the United States in 2015 — almost double the 1.1 billion in 2011, per the Hass Avocado Board.

Colombia, with its long growing season and large avocado supply, can help fill the demand. “A growing U.S. population and growing Hispanic share of the population, greater awareness of the avocado’s health benefits, year-round availability of fresh, affordable Hass avocados, and greater disposable income have contributed to the increased demand,” said the APHIS in its proposal.

While the agency notes the need for rigorous pest-control protocols before granting authorization, it acknowledges that the guacamole-crazed country cannot meet demand internally. “The increase in demand over the past decade has contributed to domestic producers being able to maintain production levels despite the large increase in avocado imports,” stated the agency in its proposal to change the regulation.

Yesterday, the USDA, through its Animal and Plant Health Inspection Service (APHIS) agency, submitted its proposed rule change to accommodate Colombia’s request and opened up the plan for public comment. While the public comments may unveil more concerns — and U.S.-based producers certainly won’t welcome the competition — the only barrier the USDA sees is logistical.

The agency restricts produce imports from certain parts of the world to prevent the spread of pests, but as long as Hass avocado growers in Colombia can abide by a series of procedures to minimize the risk, APHIS sees no reason to continue prohibiting imports. “We are proposing to amend the regulations to allow the importation of commercial consignments of fresh Hass avocados from Colombia into the continental United States, subject to a systems approach,” wrote the agency in its report.

The proposal details all the necessary provisions for Colombian producers to start sending their avocados northward, most of which focus on keeping four specific pests out of country. Beyond standard port-of-entry inspection, the document mandates producer registration with Colombian authorities, grove pest-control protocols, ongoing inspection, regular systematic audits, regulator oversight, and packaging stipulations, among other manageable conditions. So while the public comment period lasts through December 27, it looks like the border will be opening up soon for Colombian avocados.

It is happening at just the right time. The price of avocados has surged over the past month in the United States because of a supply shortage. This is largely due to a growers’ strike in Mexico, which produces the bulk of avocados eaten north of the border. Low harvest yields in California have exacerbated the problem.

Mexican growers were holding back their product to protest what they believe is an unfairly low price. This caused the import volume coming into the United States to fall to a trickle. Nearly 34.5 million pounds of avocados came from Mexico to the United States during the week of September 11, according to the California-based trade group Hass Avocado Board. By the week of October 16, that number plummeted to just eight million. “The primary issue revolved around sales negotiations between the growers and packers,” said the Association of Growers and Packers of Avocados From Mexico (APEAM) in a statement.

The strike has ended, and imports into the United States spiked all the way to 50 million pounds in the last week for which data is available. But the damage has already been done to the market supply that may not recover until next year. “We’re not going to have any avocados for anybody for maybe a week and a half,” Cythnia Guzman of California-based distributor Nature’s Produce, told CNBC last week. “We’re seeing fruit out there at double the price it normally would be.”

The industry tried to address the shortage by increasing imports from Chile, which upped its supply from one million pounds to three million during the month when Mexican producers went on strike. But this wasn’t even enough to offset the drop in California production (which fell from three million pounds to under 2,000 pounds amid a weak harvest).

The Dominican Republic and New Zealand also ship low quantities of Hass acovados to the United States. Peru became a low-volume importer after winning approval in 2010 as well. But outside of Mexico and California, only Chile adds a significant volume to an increasingly voracious avocado-eating market.

The APHIS acknowledges that added competition from Colombian producers could negatively impact farmers in California. Their loss could be as high as $6 million USD depending upon the added import volume. But the overall effect would be positive for the country, as a larger supply would help the wallets of consumers, albeit only with a price drop of about 2%. “Consumer welfare gains outweigh producer welfare losses,” said the agency.

More than price, however, the biggest benefit would come from receiving another supply point. At the current rate of demand increase, Mexico and California likely cannot keep up. Nearly 2.2 billion pounds of Hass avocados were shipped in the country last year — almost double the 1.1 billion in 2011, per the Hass Avocado Board.

“A growing U.S. population and growing Hispanic share of the population, greater awareness of the avocado’s health benefits, year-round availability of fresh, affordable Hass avocados, and greater disposable income have contributed to the increased demand,” said the APHIS in its proposal.

Demand is also rising sharply in China, where Peru sends more of its crop. According to the Global Times of China, the nation of 1.4 billion imported 12,319 tons of avocados from Peru in 2015 and is projected to bring in 22,764 tons in 2016. And that pales in comparison to the 37,075 tons of imports — from Peru alone — forecasted in 2017.

Colombia is an obvious candidate to help fill global demand. Avocados are ubiquitous throughout the tropical nation of nearly 50 million people, and many believe its agribusiness sector is set for a boom. The country’s 52-year conflict with the Revolutionary Armed Forces of Colombia (FARC) guerrilla group has kept farmers from reaching their potential, with danger in rural areas and the pressure to grow more-lucrative coca plants suppressing the development of other crops.

If the red tape from U.S. regulators can be cleared so that Colombian farmers can start exporting to the world’s largest market, production in the country could skyrocket. And if a larger Colombian crop can also help keep prices down for guacamole lovers in New York and Los Angeles, everyone in both nations — with perhaps the exception of growers in California — will be happy to see Colombia share its delicious avocados with the rest of the world.