By Sapriya Sharma

The Big Mac Index, coined by The Economist in 1986, is a measure of a country’s purchasing power and economic stability. But could this burgernomics be replaced by a more nuanced avoconomics to use a country’s access to avocado consumption as a glimpse into its socio-economic state of affairs? 

It is true, of course, that a fast food item like the Big Mac is much more widely consumed as opposed to a fruit like avocado. However, the point of avoconomics is to argue that the very differences in the fruit’s accessibility and consumption in different countries could act as an indicator of differences in their socioeconomic conditions. This will especially be true for the countries on the extreme end of avocado consumption. To construct this argument, I will first analyze three different avocado markets. These markets are: a) Mexico, the largest producer; b) the US, the largest consumer; and c) India, representative of the segment of countries where fruits as a whole are inaccessible to large shares of the population. In identifying the features of these markets, my analysis will focus on the price and production of avocados and the value added by the avocado trade to the respective economies. Then, I will tie the three countries together, based on their avocado markets, and draw some conclusions about their relative socioeconomic standing. 

But first, what’s the big deal about avocados? 

Avocados were first domesticated by the Mesoamerican tribes in Mexico and Central America thousands of years ago. Initially used for their curative effects on several ailments pertaining to skin and digestive health, these superfoods were soon recognised for their nutrition-dense content by the Aztecs. 

At present, from selectively-colloquial avocado-toast meals to avocado-themed stationery and merchandise, avocados have gained popularity in multiple industries. They are widely appreciated for their versatility—especially in Mexican cuisine—and are used in just about everything from salads, smoothies, and dishes, to skincare and cosmetic products. This rapid increase in the fruit’s popularity makes it an interesting point of analysis.

Image source: In references 

Establishing the markets 

With an annual production of 2.2 million metric tons, Mexico stands as the world’s largest producer and exporter of avocados. The Mexican avocado market is characterized by its well-established supply chains—including large and small-scale producers that interact in a highly competitive market—to drive up the country’s output and employment. This industry creates over 78,000 permanent and over 310,000 seasonal jobs. Hass is the leading cultivar (variant) of avocados in Michoacán, Mexico’s avocado capital, and is also the preferred variety of the US, the largest export market for Mexican avocados. 

Michoacán is the only Mexican state certified to export avocados to the US, and caters to 80% of the 60 million pounds of avocados eaten weekly. The Mexican Hass avocado imports have driven the growth of the US national and state economies. In 2021, the US imported nearly 3 billion dollars worth of avocados from Mexico, adding a value of 6.1 billion dollars to its GDP and creating over 58,000 jobs for American workers. These imported avocados cost the US more than both tequila and beer, which are two other popular exports from Mexico. Despite the rising prices, suppliers and retailers (including big houses like Walmart and Costco) compete to offer avocados for the best prices to the consumers.

Further in the supply chain are countries like India, where avocados are seen as a luxury fruit, accessible to only a limited range of income groups. As per a report published by the UN Food and Agriculture Organization in 2022, 71% of the Indian population is unable to afford nutritious food¹. In fact, 60% of the population cannot even afford the recommended daily intake of fruits and vegetables, as I will discuss in detail in the following sections. With an economic state like this, the taste of fruit as precious and healthy as avocado—or any fruit, really—is mainly enjoyed by a small fraction of the country’s urban, metropolitan population in cities like Delhi, Bangalore, and Mumbai. Even its production is limited in scale and is scattered across states like Karnataka, Kerala, Maharashtra, and Sikkim. 

Chasing the green gold 

Now that we have identified three different markets for avocados across three different countries, let’s take another look at a feature of these markets. Mexico exports approximately 85% of its total production and adds a value of over 3 billion dollars to its GDP. But here’s the catch: the 15% of produce that is left for domestic consumption is neither enough nor affordable for the country’s citizens. 

To put things in context, each kilo of avocado in Mexico sells for more than 80 pesos—the same value as Mexico’s daily minimum wage. This means that a person’s entire day of labor is equated to roughly three to six pieces of the fruit. As the price of the staple fruit continues to rise to levels that most consumers cannot meet, the country has been contemplating importing avocados. The Mexican Economy Secretary attributes this “laughable matter” to the “price of success” as the rising global demand for avocados is generating a “price pressure in the national market” of the fruit’s largest producer. 

On the other hand, while the in-house demand for Mexican avocados has gradually dropped, the US has doubled its avocado consumption in the last decade. In 2021, the US made 11.2 billion dollars from the retail sales of avocados, in addition to the jobs created in industries like distribution and production.

Therefore, despite being a net importer of avocados, the US is able to fulfill its consumers’ demands for avocados while also exporting them, earning the country an amount far exceeding the value added to Mexico’s GDP. 

It is interesting to note how avocados trade at these largely unaffordable prices —in their most original form as fruits—with no innovation or modification. They are even called the “green gold” due to the price they command in international markets. 

Despite India being one of the largest markets for fruits like bananas and mangoes, most Indians cannot even afford these fruits. The average price of avocados ranges anywhere between 150-300 INR for every kilogram of the fruit, while some imported varieties cost as high as 1500 INR per kg. Now, to put things into context: based on the GDP per capita for 2021 alone, an average Indian earns approximately 500 INR in a day. This average falls short to capture what’s happening to 60-70% of the population, as despite the increase in the per capita income in the recent years, there has been a simultaneous fall in the median wage over the years. So, this figure fails to account for the lower segments of the population—with reduced welfare, failing unorganised sectors, and other socioeconomic inequalities. An average Indian farmer, as of 2019, could earn as little as 27 INR in a day. With 70% of the rural households depending on agriculture for their income, this amount barely allows for any nutritional intake, as was also reflected in the figures from the annual report by UN Food and Agriculture mentioned earlier on in the piece.

With this differential in prices of avocados and the daily income, it comes as no surprise that the avocado is far from being native to Indian consumption. As of 2021, India only imported a mere 900 metric tons of avocados, which was sufficient for a whole year for the country’s markets due to the fruit’s selective demand and limited affordability. 

Offering caviar or truffle in the US is therefore analogous to the luxury or privilege of passing a bowl of guacamole in India. As a result, the share of avocados in India’s GDP remains negligible. 

In conclusion, a county either eats (avocado) toast or is toast—if you’ll excuse the hyperbole 

Hence, this avoconomic analysis comes down to the fact a country’s behavior of avocado consumption can reveal the inequalities that exist within its socioeconomic structures. 

Mexico, despite being able to afford and lead avocado production, fails to meet its domestic consumers’ affordability and demands. Further investigation also reveals the plethora of challenges that Mexico faces ranging from exploitative labor practices and poor living conditions to the association of crime cartels, illegal planting, and territorial wars with avocado production. There also exist several environmental consequences like deforestation, soil erosion, water scarcity, and land conflicts that come with the standard requirements for the production of avocados. All of these act as negative externalities that adversely affect Mexico’s overall socioeconomic development.

On the other hand, the fact that avocado consumption in the US increases by 15% annually, despite its classification as a luxury fruit, hints at the country’s relatively better standing as opposed to Mexico. The US imports most of its avocado produce yet is able to leverage much higher profits from its sales—all while meeting its ever-rising demands for the fruit. Hence, despite its own battles with socioeconomic issues like income inequality and lack of access to healthcare, the US has a much stronger socioeconomic foundation, as opposed to Mexico. It enjoys a higher standard of living and well-established welfare systems. 

Lastly, countries like India don’t even compare to the US or Mexico, since avocados classify as luxury goods that are accessible to very small fragments of the population. This reveals a stark concentration of wealth in the country. Hence, despite having made some strides in terms of economic growth since its independence, India is still navigating its way through socio economic issues of food insecurity and income inequality. 

Empirically, this analysis is supported by the measurement of GDP per capita in each of these countries. In the case of Mexico and the US, the Gini coefficients are 45.4 and 39.7 respectively—indicating that Mexico is more unequal than the US. This falls in line with the inherent inequalities highlighted in avocado production in Mexico. However, the comparison of Gini coefficients fails to give meaningful conclusions in comparing the US and Mexico with India. Here, the analysis is reduced to India’s inability to consume avocados simply by the virtue of it being a poorer country. Hence, where avoconomics fails us is in the case of countries that are not significant in the global avocado market as neither consumers or producers of avocados. 

A conclusion with a side of privilege mashed into the guacamole on your chips 

The key observation that reassures the use of avoconomics is the consistency in the inaccessibility of avocados across countries—including those that produce and consume the fruit the most. So, while avoconomics cannot be assembled as a scale like the Big Mac Index—nor can it replace it—the industry’s impact on employment, trade, lifestyle, and criminal activity highlights its significance as a sector to study in understanding a country’s socioeconomic conditions. It’s important to acknowledge the privilege that comes with enjoying the luxury of avocados in our salads and toasts, as it remains a scarce and unaffordable resource for many around the world.