Decision-Making in Avocado Production
B. "Is it worth starting an avocado orchard?"
Figure: California Avocado Acreage
C. "Is it worth replacing older avocado trees ?"
1. The Influence of the Costs of Production
2. The Influence of Prices and Interest Rates
D. "Is it worth expanding an existing avocado orchard?"
1. The Influence of the Costs of Production (again)
2. The Influence of the Availability of Inputs
VI. Producer Decision-Making in Avocado Production
Having described some of the basic biological characteristics as well as market characteristics of avocado production, this section of the tutorial wants to look at some of the basic questions that California avocado growers, both old and new, must face. These decisions are essentially economic decisions which are constrained or limited by biological as well as market considerations.
The first thing to emphasize is that, unlike vegetable production or row crops, avocado production (or any type of tree or vine production) involves significant set-up time and cost. Establishing a new orchard will often result in having to wait between three and five years before a commercial yield is achieved. On the other hand, avocado production, like some other tree crops, benefit from the characteristic that avocados can be "stored" on the tree for several weeks or months since avocados ripen after they have been picked.
Three different decisions will be explored in this section: