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The multi-billion-pound avocado industry shows modern supply chains operating at their best.
As more people adopt healthier lifestyles, the demand for avocados has skyrocketed. Delicious on toast or in a salad, they are a good source of monounsaturated fat, which has been linked to lowering cholesterol and a healthy heart.
The boom in demand for avocados means that over 11 billion pounds of the “green gold” are consumed worldwide annually.
Production is centred in Central and South America, and at DP World Caucedo they are big business! Interestingly, Mexico is the world’s leading producer of the fruit, exporting $2.8 billion worth around the world each year, but countries like Peru and Colombia are growing rapidly with demand strongest in the US, Europe and Asia
In the US, avocado consumption has risen by 443% over last 20 years, according to the United States Department of Agriculture. And it is not just in the States where demand for avocados is soaring, with Europe’s consumption expected to jump 12% this year to a record 670,000 tons.
However, this increased growth means there is a significant need to optimise the avocado supply chain.
It can be a challenge to manage the supply chains of perishable foods dues to their short shelf life, especially over long distances.
Ripe on time
Avocados are unique as they mature on the tree and ripen once they have been picked, which can take up to two weeks. This means shipping avocados to hit supermarket shelves “ready to eat” is no easy task.
As consumers do not want avocados to be too hard or too soft, ripening facilities have been added to the supply chain. When avocados leave the packing plant, they are subjected to ethylene gas treatment which helps regulate their ripening and prevents the discoloration associated with aging.
Avocados require cold chain transport – the temperature-controlled distribution chain used for food beverages and pharmaceuticals - to maintain quality from when they are harvested right up until they hit the shops.
Any break in the cold chain during the shipping process can result in them entering the ripening process, leading to rotting, bacteria or mould. As avocados typically prefer a container of one-degree Celsius while en route, it is vital that supply chain managers make sure temperatures are not too cold, otherwise they can shrink.
To avoid any deterioration, avocados are closely monitored during shipment for variations in light exposure and temperature. Once they arrive at their destination country, they are then sorted at a distribution centre into ventilated containers or bags and routed to shops and supermarkets. Coordinating deliveries of products which decay easily requires strategic planning. Technology, through the use of artificial intelligence (AI) and advanced analytics, is also increasingly being used to help strengthen supply chains.
To optimise the supply chain, sophisticated software is used to create a digital twin. Using advanced analytics, the digital twin replicates the supply chain performance, allowing producers to maximise their capacity to manufacture, ship, and warehouse.
Extreme weather events affect crop yields and disrupt supply, even though demand is growing globally. Other issues which can affect supply chains include labour unrest, strikes, earthquakes and factory fires. AI can provide supply chain managers with the tools to anticipate and avoid supply disruption, improve visibility and respond more rapidly.
DP World believes that by working with retail partners throughout the avocado supply chain it can help build fully integrated and highly efficient solutions - such as optimising the cold chain - in response to fast-changing consumer and lifestyle habits.