With avocado crop losses mounting in the California wildfires and harvest near, we could see pricing impacts, an industry official said.
Wildfires continued to rage across Southern California on Friday, and initial assessments showed significant amounts of avocado groves were already lost in the so-called Thomas fire in Ventura County and at least one grove scorched in another blaze further south in San Diego County.
"The fires stayed up in the foothills and that's where a lot of our avocado production occurs," John Krist, CEO of the Farm Bureau of Ventura County, told CNBC in an interview Friday. "So there's clearly damage or destruction of I'd say, conservatively, several hundred acres of avocado groves, and I'm sure that number will go up as we get better information about what's going on further back in those canyons."
Experts say avocado trees may have suffered internal damage due to heat from nearby wildfires, especially if they were adjacent to trees on the perimeter of groves. They say the wildfires can sometimes produce heat reaching 125 degrees or more and potentially cause permanent vascular damage to the trees.
"Those are the kind of things we won't know for a few weeks," said Ken Melban, vice president of industry affairs for the California Avocado Commission, which represents growers in the state. He added that the damage also could show up later even when groves may initially appear to be unhurt.
Either way, Melban said the avocado growers were impacted from Ventura to San Diego counties by the current wildfires. He said the worst of the crop damage so far appears to be from the Ventura fire.
"We are in close contact with our industry members in the areas, and we know that there have been a significant number of them affected by the fires," he said.
Still, Melban said it was "premature to give any kind of indication about the impact on next year's large crop."
A decade ago, California represented about half of the total U.S. consumption of avocados. The state now represents only roughly one-fifth of the total supply for the U.S., with the main source now imports from Mexico.
California's avocado harvest tends to run from late March through September, so there is small fruit on trees but it's generally not considered ready for picking this time of year.
With the wildfire losses and avocado harvest nearing, Melban said it's possible we might see pricing impacts to consumers. Then again, he stressed it's still "way way premature to know" since the harvest is still several months away.
A check of several produce wholesalers, though, found they expect the pricing to get stronger in the next several weeks. However, most indicated it was due largely to tighter supplies coming from Mexico and not California's fires.
"These last few months have been kind of too cheap on avocado prices, so the growers stopped picking them in Mexico," said a California produce wholesaler who didn't want to be identified. "That made them harder to get and so we're already seeing prices move up again."
Overall, there are currently at least five major wildfires burning in Southern California. On Friday, President Donald Trump declared a federal emergency for the devastating blazes, which frees up federal funding for aid.
The largest of the blazes is the Thomas fire, which started Monday in Ventura County and as of Friday evening had burned more than 143,000 acres and was 10 percent contained. More than 480 homes have been destroyed or damaged, according to Cal Fire.
The Thomas fire also affected the air quality in areas of Ventura County, where row crops such as strawberries and vegetables are ready for harvest. Health experts were advising people to stay indoors and avoid breathing smoke and the ash, although some farm workers who went to work received special masks to help protect them from the smoke in the fields, officials said.
Ventura County's huge citrus operations also suffered impacts, and some wine grape production near Ojai was in the path of the fires, officials said. Also, the gusty Santa Ana winds that have fed the Thomas fire might have caused additional losses in avocados and citrus as a result of fruit dropping from trees.
On Tuesday, the Thomas fire destroyed a dozen structures at Limoneria, a Santa Paula-based lemon and avocado grower. It also led to a brief power outage at the company's lemon packinghouse.
Limoneira's stock price fell more than 11 percent this week. The company didn't return calls for comment.
Krist toured the Limoneria facility Thursday and said "fire burned right down to the edges of groves. But there doesn't appear to have been much direct or indirect damage to the orchards themselves."
Another Ventura County agribusiness, Calavo Growers, was down about 6 percent this week. The fires were near some of the company's groves but it was still unclear whether there was any damage. Calavo declined comment.
Meantime, the California Cut Flowers Commission on Thursday said growers of cut flowers were being threatened by Southern California fires. It said the Thomas fire was burning close to nearly two dozen flower farms in the Carpinteria Valley, which it referred to as "the flower basket of the United States." Also, it said smaller fires have also been reported near flower farms in San Diego and Lompoc.