Fresh Del Monte Produce Inc. (NYSE: FDP), one of the world’s leading vertically integrated producers, marketers, and distributors of high-quality fresh and fresh-cut fruit and vegetables, has announced its acquisition of a majority stake in Avolio, Uganda’s foremost supplier of bulk crude and edible avocado oil. This strategic move underscores Fresh Del Monte’s ongoing commitment to expanding its portfolio into high-value specialty ingredients, reinforcing its long-term business vision.
The acquisition of Avolio marks a significant milestone for Fresh Del Monte, as it aims to enhance its capability to transform avocados into premium avocado oil. This initiative aligns with the company’s long-term strategy, which focuses on Specialty Ingredients and Innovation. The avocado, a nutrient-rich fruit known for its versatility, is one of the few fruits that can be processed into oil extracted from the pulp. Avolio has been at the forefront of leveraging this process to create additional value from avocados that do not meet the standards for fresh consumption. By utilizing fruit that might otherwise go to waste, Avolio’s operations directly support Fresh Del Monte’s broader sustainability goals, including its commitment to reducing food waste and promoting a circular economy.
Strengthening Sustainability and Innovation in Agriculture
The acquisition aligns with Fresh Del Monte’s larger vision of integrating sustainability and innovation into its supply chain. As part of this strategy, Fresh Del Monte has been investing in biomass and specialty ingredients, transforming agricultural byproducts into valuable products that contribute to environmental sustainability while driving commercial growth.
“Acquiring Avolio is a strategic step aligned with our long-term vision to extract greater value across our supply chain while advancing our commitment to sustainability,” said Mohammad Abu-Ghazaleh, Chairman and CEO of Fresh Del Monte. “This acquisition complements our newest business division—biomass and specialty ingredients—through which we are transforming agricultural byproducts into high-impact solutions that enhance soil health, support human wellness, and create new applications for a circular economy. These efforts not only reinforce our environmental stewardship but also position us to compete in higher-margin categories that drive profitable growth and long-term shareholder value.”
Avolio’s advanced extraction technology will be instrumental in this expansion. Currently, the company’s processing capabilities allow for the extraction of avocado oil at an industrial scale. Fresh Del Monte plans to scale up these operations significantly, with a goal of processing up to 140 metric tons of avocados per day. This increased capacity will not only maximize the economic potential of avocado oil but also provide a sustainable alternative to conventional edible oils, aligning with the rising consumer demand for healthier, plant-based oils.
The Growing Market for Avocado Oil
The global avocado oil industry is poised for substantial growth. According to Fortune Business Insights, the market is currently valued at approximately $1.2 billion and is projected to grow at a compound annual growth rate (CAGR) of 8% to 10% over the next several years. This growth is being driven by increasing consumer awareness of the health benefits associated with avocado oil, including its high content of heart-healthy monounsaturated fats, antioxidants, and vitamins. Additionally, avocado oil is widely used in the food industry for cooking and as a premium ingredient in dressings and marinades, while also being a key component in personal care and cosmetic products due to its moisturizing and anti-aging properties.
By securing a majority stake in Avolio, Fresh Del Monte is positioning itself to be a leader in this rapidly expanding industry. The company plans to capitalize on the growing demand for avocado oil by expanding its production capacity and establishing new processing facilities in strategic locations worldwide. By doing so, Fresh Del Monte will be able to supply high-quality avocado oil to various markets, catering to both food manufacturers and consumers looking for premium, sustainably sourced ingredients.
Strengthening Global Supply Chains and Market Expansion
Fresh Del Monte’s acquisition of Avolio also enhances its global supply chain capabilities. With decades of experience in the fresh produce industry, Fresh Del Monte has built a robust distribution network that spans multiple continents. This acquisition will allow the company to integrate Avolio’s expertise in avocado oil extraction with its own well-established supply chain, ensuring efficiency and reliability in the production and distribution of avocado oil products.
In addition to Uganda, Fresh Del Monte is exploring opportunities to expand avocado oil production into other regions with favorable growing conditions for avocados. This includes Latin America, where the company already has a strong presence in the avocado industry. By diversifying its production sources, Fresh Del Monte aims to mitigate risks associated with seasonal fluctuations and geographic limitations, ensuring a consistent supply of avocado oil to meet the increasing global demand.
A Sustainable and Profitable Future
Fresh Del Monte’s acquisition of Avolio is not just a financial investment; it is a testament to the company’s commitment to sustainable and innovative agricultural practices. By utilizing avocados that would otherwise go to waste, Fresh Del Monte is reinforcing its efforts to minimize food loss and contribute to a more efficient and responsible food system.
Moreover, the expansion into the avocado oil market presents an opportunity for Fresh Del Monte to strengthen its position in the high-margin specialty ingredients sector. By offering premium, sustainably sourced avocado oil, the company is tapping into a lucrative market segment that aligns with consumer preferences for healthier and environmentally friendly food options.
