Author: Etaferahu Takele, Gary Bender, Mao Vue

There is a growing concern that the fast expanding and globalized competitive world market is causing decline in grower returns and expansion of urban development and environmental regulations causing production cost increases and challenging the viability and sustainability of producing these crops. San Diego and Riverside counties are among the top avocado producing counties in California. These counties make up 49% of the California avocado industry; grossing over $268 million in 2011. It has been over 10 years since we developed a cost study for avocados in California. The establishment and production costs and profitability analyses have been the fundamental tool that growers and investors use for investment analyses and decisions, conducting business transactions, and risk management strategies. In this study, we provide up to date costs of establishment and production and profitability; benchmark indicators for evaluating the viability and sustainability of avocado production. This study is based on assumptions of orchard establishment and production practices that are considered typical in San Diego and Riverside counties and is based on a 20 acres orchard. Data regarding production practices, inputs and prices was collected from growers, the University of California Cooperative Extension (UCCE) farm advisor, agricultural institutions, and supply and equipment dealers. While this study makes every effort to model a production system based on typical, real world practices, it cannot fully represent financial, agronomic, and market risks, which affect the profitability and economic viability of all producers.