Avocado supplier stocks slide after U.S. tariff announcement, rebound slightly after truce with Mexico

Around 80% of avocados sold in the U.S. come from Mexico. / Photo: Unsplash/Kelly Sikkema
Shares of several small-cap suppliers of avocados took a tumble yesterday, Monday, February 3, following the announcement by President Donald Trump of new tariffs on Mexico, Canada, and China. However, the losses eased later in the day after the U.S. and Mexico agreed to a truce for a month. Note that around 80% of avocados sold in the U.S. are imported from Mexico, which sparked fears of higher consumer prices.
Details
— Shares of Mission Produce, which imports avocados from Mexico, were down 1.6% by the close of trading in New York. Earlier in the day, the loss had been as big as 4.5%, with the share price reaching a nearly five-month low. Yesterday, Mission Produce’s market capitalization stood at approximately $830 million.
— Calavo Growers, another avocado supplier with a market capitalization of $400 million, slid 2.1% for the day, clawing back some of the losses. It was down as much as 3.6% during the session.
— Shares of Limoneira, an agribusiness company specializing in avocados, citrus fruits, and nuts, lost 2.4%.
What happened
Avocado supplier stocks tumbled yesterday following President Donald Trump’s announcement of tariffs on imports from Mexico, Canada, and China, set to take effect today, February 4. However, later in the day, after talks with Mexico’s president, Trump agreed to delay the tariffs on Mexico for one month. This helped the affected stocks pare some of their losses, though they still closed in the red.
Context
According to the U.S. Department of Agriculture, around 80% of avocados sold in the U.S. come from Mexico. The tariffs will translate into higher prices for consumers, analysts cited by the said.
Avocado prices are already up 14% from a year before, according to NielsenIQ data. The U.S. has options for alternatively sourcing avocados, though they look limited, Bloomberg noted. For example, fast-food chain Chipotle Mexican Grill sources avocados from Colombia and the Dominican Republic. Meanwhile, grocery retailer Mariano’s, owned by Kroger, imports avocados from Chile and Peru.