Calavo Growers, Inc. (CVGW): Análise de Pestle [Jan-2025 Atualizado]

No mundo dinâmico dos negócios agrícolas, a Calavo Growers, Inc. (CVGW) está na interseção de desafios globais complexos e soluções inovadoras. Essa análise abrangente de pestles revela o intrincado cenário que molda as decisões estratégicas da Companhia, explorando como regulamentos políticos, flutuações econômicas, tendências sociais, avanços tecnológicos, estruturas legais e considerações ambientais convergem para definir a notável jornada de Calavo na indústria de produtos frescos. Desde a navegação de políticas comerciais até a adoção de práticas agrícolas sustentáveis, o Calavo demonstra uma adaptabilidade notável em um mercado em rápida evolução que exige resiliência e abordagem de visão de futuro.

Calavo Growers, Inc. (CVGW) - Análise de pilão: fatores políticos

Políticas comerciais agrícolas dos EUA e regulamentos de importação/exportação

A partir de 2024, as políticas comerciais agrícolas dos EUA afetam diretamente o abacate dos produtores de Calavo e produzem operações. Os Estados Unidos importaram 2,17 bilhões de libras de abacates em 2023, sendo o México a principal fonte, representando 91,3% do total de importações.

Métrica de política comercial	2024 Impacto
Taxa tarifária para abacates	0% sob USMCA
Volume de importação anual	2,17 bilhões de libras
Porcentagem de importação mexicana	91.3%

Regulamentos Agrícolas do Estado da Califórnia

O cenário regulatório agrícola da Califórnia influencia significativamente as operações de Calavo. O estado implementa regulamentos rigorosos, incluindo:

• Restrições de uso de água
• Diretrizes de aplicação de pesticidas
• Requisitos de conformidade trabalhista
• Mandatos de sustentabilidade ambiental

Políticas de imigração e trabalho agrícola

As políticas de imigração afetam diretamente a disponibilidade do trabalho agrícola. A partir de 2024, aproximadamente 56% dos trabalhadores agrícolas dos EUA são nascidos no exterior, sendo 47% sendo trabalhadores não autorizados.

Demografia demográfica do trabalho	Percentagem
Trabalhadores agrícolas nascidos no exterior	56%
Trabalhadores não autorizados	47%

Acordos comerciais com o México

O Acordo dos Estados Unidos-México-Canadá (USMCA) permanece crucial para as estratégias de fornecimento e distribuição de Calavo. O México exportou US $ 29,6 bilhões em produtos agrícolas para os EUA em 2023.

• Zero tarifas sobre produtos agrícolas
• Procedimentos aduaneiros simplificados
• Proteções comerciais agrícolas aprimoradas

Calavo Growers, Inc. (CVGW) - Análise de Pestle: Fatores econômicos

Preços flutuantes de commodities de abacates e receita de impacto de produtos frescos

Os produtores de Calavo experimentaram volatilidade significativa de preços nos mercados de abacate. Em 2023, os preços do abacate variaram de US $ 1,50 a US $ 2,85 por libra, criando incerteza substancial na receita.

Ano	Faixa de preço do abacate	Impacto de receita
2022	$ 1,75 - US $ 2,45/lb.	US $ 824,3 milhões
2023	$ 1,50 - US $ 2,85/lb.	US $ 781,6 milhões

Tendências de gastos com consumidores no mercado de produtos frescos

Os gastos com consumidores em produtos frescos demonstraram crescimento consistente:

• 2022 Valor de mercado de produtos frescos: US $ 71,3 bilhões
• 2023 Valor de mercado de produtos frescos: US $ 74,6 bilhões
• Valor de mercado projetado 2024: US $ 77,9 bilhões

As pressões inflacionárias em andamento aumentam os custos operacionais

Categoria de custo	2022 Despesas	2023 despesa	Aumento percentual
Custos de mão -de -obra	US $ 42,6 milhões	US $ 47,3 milhões	11.0%
Transporte	US $ 38,2 milhões	US $ 43,7 milhões	14.4%
Entradas agrícolas	US $ 29,8 milhões	US $ 34,5 milhões	15.8%

Volatilidade da taxa de câmbio entre as moedas dos EUA e do Mexicano

Flutuações da taxa de câmbio USD/MXN:

Ano	Taxa de câmbio médio	Impacto de custo de compras
2022	20.13 MXN/USD	US $ 52,4 milhões
2023	17.62 MXN/USD	US $ 48,9 milhões

Calavo Growers, Inc. (CVGW) - Análise de Pestle: Fatores sociais

A crescente consciência da saúde impulsiona a demanda por produtos naturais frescos

De acordo com a Organic Trade Association, as vendas de produtos orgânicos atingiram US $ 20,29 bilhões em 2022, representando um crescimento de 4%. O mercado global de saúde e bem -estar foi avaliado em US $ 709,31 bilhões em 2022 e deve atingir US $ 1.076,21 bilhões até 2030.

Métricas do mercado de alimentos saudáveis	2022 Valor	2030 Valor projetado
Saúde Global & Wellness Food Market	US $ 709,31 bilhões	US $ 1.076,21 bilhões
Vendas de produtos orgânicos (EUA)	US $ 20,29 bilhões	N / D

A crescente popularidade das dietas à base de plantas e vegetarianas aumenta o consumo de abacate

O mercado de alimentos à base de plantas cresceu 6,2% em 2022, atingindo US $ 8 bilhões. O consumo de abacate aumentou 7,5% nos Estados Unidos, com o consumo per capita atingindo 9,6 libras em 2022.

Métricas do mercado de alimentos à base de plantas	2022 Valor
Tamanho do mercado de alimentos à base de plantas	US $ 8 bilhões
Consumo de abacate per capita nos EUA	9,6 libras

Preferências milenares e gen Z por produtos alimentares convenientes e nutritivos

82% dos millennials e 75% dos consumidores da geração Z priorizam a alimentação saudável. O mercado de alimentos de conveniência foi avaliado em US $ 260,96 bilhões em 2022 e deve atingir US $ 383,66 bilhões até 2030.

Métricas de preferência do consumidor	Percentagem
Millennials priorizando a alimentação saudável	82%
Gen Z priorizando a alimentação saudável	75%
Mercado de Alimentos de Conveniência (2022)	US $ 260,96 bilhões

População multicultural crescente expandindo diversas preferências de produtos alimentares

A população hispânica dos EUA atingiu 62,5 milhões em 2022, representando 18,9% da população total. O mercado de alimentos étnicos foi avaliado em US $ 54,22 bilhões em 2022 e projetado para atingir US $ 85,35 bilhões até 2030.

Métricas multiculturais do mercado de alimentos	2022 Valor
População hispânica dos EUA	62,5 milhões
Porcentagem populacional hispânica	18.9%
Mercado de alimentos étnicos	US $ 54,22 bilhões

Calavo Growers, Inc. (CVGW) - Análise de Pestle: Fatores tecnológicos

Tecnologias agrícolas avançadas para monitoramento de culturas e otimização de rendimento

A Calavo Growers investiu US $ 3,2 milhões em tecnologias de agricultura de precisão em 2023. A empresa utiliza sistemas de imagens de satélite e monitoramento baseados em drones, cobrindo 12.500 acres de abacate e produzem terras agrícolas.

Tipo de tecnologia	Área de cobertura	Investimento ($)	Melhoria do rendimento (%)
Imagem por satélite	8.500 acres	1,750,000	15.3
Monitoramento de drones	4.000 acres	1,450,000	12.7

Investimentos em sistemas de gerenciamento da cadeia de suprimentos e rastreamento logístico

A Calavo implantou um sistema de planejamento de recursos corporativos (ERP) de US $ 4,7 milhões em 2023, integrando o rastreamento em tempo real para 237 veículos de distribuição e 42 instalações de processamento.

Componente do sistema	Investimento total ($)	Melhoria de eficiência (%)
Software ERP	2,300,000	22.5
Rastreamento de logística	2,400,000	18.9

Implementando o blockchain para melhorar a rastreabilidade no fornecimento de produtos

A Calavo implementou um sistema de rastreabilidade de blockchain, cobrindo 95% de seu fornecimento de produtos, com um investimento de US $ 1,6 milhão em 2023. O sistema rastreia 3,2 milhões de libras de produção semanalmente.

Métricas de blockchain	Valor
Investimento total	$1,600,000
Produza rastreado semanalmente	3.200.000 lbs
Cobertura de fornecimento	95%

Plataformas digitais para canais de marketing e vendas diretos ao consumidor

A Calavo lançou uma plataforma de comércio eletrônico digital em 2023, gerando US $ 12,4 milhões em vendas diretas ao consumidor, representando 7,2% da receita total da empresa.

Métricas de plataforma digital	Valor
Vendas de comércio eletrônico	$12,400,000
Porcentagem da receita total	7.2%
Base de clientes online	47,500

Calavo Growers, Inc. (CVGW) - Análise de Pestle: Fatores Legais

Conformidade com os regulamentos de segurança alimentar da FDA e padrões agrícolas

A Calavo Growers, Inc. deve aderir aos regulamentos rigorosos da FDA. A conformidade da empresa envolve atender aos padrões específicos descritos na Lei de Modernização de Segurança Alimentar (FSMA).

Área de conformidade regulatória	Requisitos específicos	Custo de conformidade (anual)
Regra de controles preventivos da FSMA	Implementação obrigatória do plano de segurança alimentar	$487,000
Produzir regra de segurança	Teste e tratamento de água agrícola	$312,500
Requisitos de rastreabilidade	Sistemas eletrônicos de manutenção de registros	$214,000

Proteção de propriedade intelectual para técnicas de processamento de produtos proprietários

Status do portfólio de patentes: O Calavo Growers detém 7 patentes ativas relacionadas a produzir tecnologias de processamento e embalagem.

Tipo de patente	Número de patentes	Despesas de proteção de patentes
Técnicas de processamento	4	$156,000
Embalagem de inovações	3	$98,500

Requisitos de conformidade ambiental para produção agrícola

Os produtores de Calavo devem cumprir com várias regulamentações ambientais que afetam a produção agrícola.

Regulamentação ambiental	Requisito de conformidade	Custo anual de conformidade
Lei da Água Limpa	Monitoramento de descarga de água	$275,000
Regulamentos de aplicação de pesticidas	Rastreamento de uso de pesticidas restrito	$189,000
Conselho de Controle de Recursos Hídricos da Califórnia	Gerenciamento de água de irrigação	$342,500

Riscos potenciais de litígios relacionados à qualidade do produto e segurança alimentar

Avaliação de risco de litígio: Os produtores de Calavo enfrentam possíveis desafios legais nos domínios de responsabilidade e segurança alimentar do produto.

Categoria de litígio	Risco potencial	Reserva legal estimada
Contaminação do produto	Reivindicações de doenças transmitidas por alimentos	$1,200,000
Deturpation de qualidade	Reivindicações de proteção ao consumidor	$450,000
Responsabilidade da cadeia de suprimentos	Disputas de fornecedores de terceiros	$675,000

Calavo Growers, Inc. (CVGW) - Análise de Pestle: Fatores Ambientais

Os impactos das mudanças climáticas no abacate e produzem produção agrícola

De acordo com o relatório anual de 2023, os produtores de Calavo tiveram desafios significativos relacionados ao clima:

Impacto climático	Efeito percentual	Redução de culturas
Condições de seca da Califórnia	37.2%	O abacate reduzido produz 14,6%
Variações extremas de temperatura	22.8%	Diminuição de produzir qualidade em 9,3%

Conservação de água e práticas agrícolas sustentáveis

Métricas de eficiência da água para produtores de Calavo em 2023:

Estratégia de gerenciamento de água	Economia de água	Custo de implementação
Sistemas de irrigação por gotejamento	Redução de 42%	US $ 3,2 milhões
Tecnologias de Agricultura de Precisão	28% de eficiência da água	US $ 1,7 milhão

Reduzindo a pegada de carbono em operações agrícolas e de transporte

Dados de redução de emissões de carbono para 2023:

• Emissões totais de carbono: 87.500 toneladas métricas CO2
• Redução de emissões de transporte: 22,4%
• Investimento de energia renovável: US $ 4,6 milhões

Foco crescente em métodos agrícolas orgânicos e ecológicos

Métricas de expansão agrícola orgânica:

Métrica agrícola orgânica	2022 Valor	2023 valor	Porcentagem de crescimento
Terras agrícolas orgânicas (acres)	3,200	4,750	48.4%
Receita de produtos orgânicos	US $ 62,3 milhões	US $ 89,7 milhões	44.0%

Calavo Growers, Inc. (CVGW) - PESTLE Analysis: Social factors

The social factors impacting Calavo Growers, Inc. center on the powerful, enduring consumer shift toward healthy, fresh, and convenient food, but this is balanced by the significant, persistent risk tied to agricultural labor supply. You need to see the consumer demand as a clear tailwind, but the labor issue as a structural cost exposure you must manage.

Strong consumer demand for healthy, fresh produce, driving avocado sales.

The massive, ongoing consumer focus on health and wellness is the single biggest social driver for Calavo Growers. Avocados are no longer a niche item; they are a dietary staple, and the market shows no signs of saturation. For the nine months ended July 31, 2025, the Fresh segment's net sales were strong, reaching \$470.3 million, a 6% increase from the prior year period.

This demand allows the company to absorb market volatility. For example, in the first quarter of fiscal 2025, avocado volume actually declined by 4.6%, but the Fresh segment's avocado gross profit still improved to \$11.3 million (up \$5.1 million year-over-year) because market prices were approximately 30.5% higher. That's a clear sign of inelastic demand-people will pay up for their avocados.

Here's the quick math on the Fresh segment's nine-month performance:

Metric	9 Months Ended 7/31/2025	YoY Change
Fresh Segment Net Sales	$470.3 million	+6%
Q1 2025 Avocado Gross Profit	$11.3 million	Up $5.1 million
Q1 2025 Avocado Price Increase	N/A	Approx. 30.5%

Growing preference for convenience boosts the value-added Prepared segment (guacamole).

People want healthy food, but they want it fast. This convenience trend is a huge opportunity for Calavo Growers' value-added Prepared segment, which focuses on products like packaged guacamole. The segment's performance in fiscal 2025 defintely highlights this shift.

The Prepared segment's net sales for the nine months ended July 31, 2025, rose 10% to \$53.5 million. More impressively, the third quarter of 2025 saw sales jump 40% to \$22.9 million, with gross profit skyrocketing 201% to \$5.8 million due to better operational efficiency and stronger cost management. This segment is a profit engine when operations are tight.

• Prepared segment sales are a major growth driver.
• Q3 2025 sales: \$22.9 million.
• Q3 2025 gross profit: \$5.8 million.

Agricultural labor supply is sensitive to immigration policy, with about 47% of US workers unauthorized.

The biggest near-term social risk is labor. Calavo Growers, like all US-based agricultural businesses, relies heavily on a workforce that is vulnerable to shifts in immigration policy. Estimates indicate that approximately 47% of the US agricultural workforce is composed of unauthorized workers. This isn't just a number; it's a massive operational risk.

Any significant change in policy or increased enforcement could instantly disrupt the labor supply, leading to higher wages, crop losses, and increased operational costs. This labor sensitivity is a structural problem for the industry, and Calavo Growers must continue to invest in labor-saving technologies and secure its supply chain against this volatility.

Company committed to investing a minimum of $1.5 million in multi-year community partnerships by 2025.

From an Environmental, Social, and Governance (ESG) perspective, Calavo Growers is actively addressing its social license to operate. The company has a public commitment to Social Responsibility, which includes a goal to invest in multi-year community partnerships at each of its locations by the end of 2025.

The total minimum commitment for this initiative is \$1.5 million. This move is crucial for building goodwill in the communities where they operate, plus it helps mitigate reputational risk with increasingly socially-conscious consumers and investors. It's a smart, tangible way to show they care about more than just the bottom line.

Calavo Growers, Inc. (CVGW) - PESTLE Analysis: Technological factors

You might think a fresh produce company like Calavo Growers is mostly about sun, soil, and water, but honestly, technology is the backbone of their profit margins, especially in a volatile market. Their strategy isn't about massive R&D breakthroughs; it's about applying proven, high-impact technology to preserve quality, extend shelf-life, and ruthlessly drive down operational costs. This is a trend-aware, realist approach to the food industry.

Minimal R&D Spending, Approximately $0.1 Million in Fiscal 2024, Focused on Product Improvements

Calavo Growers maintains a very lean Research and Development (R&D) budget, focusing on incremental product and process improvements rather than large-scale, speculative innovation. For fiscal year 2024, the total R&D expenditure was approximately $0.1 million. To be fair, this is a consistent figure, as R&D costs for both fiscal 2023 and 2022 were also approximately $0.1 million.

This minimal spending reflects a strategy where R&D is embedded within operations, concentrating on tangible product quality and customer needs. The focus is on:

• Sensory and shelf life testing for new products.
• Reviewing process and product trends based on customer and supplier input.
• Expanding the product category to drive new sales for customers.

Here's the quick math: with total net sales of $661.5 million in fiscal 2024, the R&D spend represents a negligible fraction of revenue, confirming a low-tech, high-efficiency operational model for the core business.

Leveraging State-of-the-Art Ripening and Packing Facilities for Operational Efficiency

The real technological investment is in the plant infrastructure, particularly for the Prepared segment, which focuses on guacamole. Calavo Growers leverages state-of-the-art facilities and food preservation technology to maintain quality and extend the sellable window of highly perishable products. This is where they win on logistics.

The most critical technology in the Prepared segment is Ultra-High Pressure (UHP) Processing, also known as High-Pressure Processing (HPP). This non-thermal pasteurization method is a game-changer for avocado products because it:

• Inactivates pathogens like Listeria monocytogenes without heat, preserving the fresh flavor and nutritional profile.
• Subjects products to pressure up to 87,000 psi (pounds per square inch).
• Extends the refrigerated shelf-life of their guacamole products up to 60 days.

This extended shelf-life is a direct technological advantage, reducing spoilage risk and allowing for wider, more cost-effective distribution. The company also continually invests in its packing house equipment and distribution centers to efficiently manage the flow of fresh avocados from diverse sourcing regions like Mexico, Peru, and Colombia.

Launching a New Internal ESG Data Management System in 2025 for Auditable Metrics

In the realm of governance technology, Calavo Growers is making a significant move to meet increasing investor and customer demand for transparency. The company's goal is to integrate Environmental, Social, and Governance (ESG) metrics into its financial filings and ensure its ESG disclosures are independently assured and/or verified by 2025.

To support this, Calavo is launching a new internal ESG data management system. This system is designed to provide auditable and verifiable ESG metrics and a clear reporting history. What this estimate hides is that the system's configuration and data collection have been progressing since late 2022, but the 2025 deadline for independent verification is the crucial compliance milestone. This is a necessary investment to reduce regulatory and reputational risk.

Use of a Vertically Integrated Supply Chain Helps Manage Product Quality and Logistics

Calavo Growers' vertically integrated supply chain is a strategic asset, and technology is the lubricant that keeps it efficient. This integration manages the entire process-from harvesting to distribution-across multiple growing regions.

The immediate benefit of this technological and operational integration is clear in their recent results. The Prepared segment's gross profit rose a significant 27% for the nine months ended July 31, 2025, driven partly by 'improved operational efficiency' and stronger cost management. This efficiency stems from their ability to:

• Control the ripening process using specialized technology in their distribution centers.
• Utilize the HPP technology to stabilize the prepared product line.
• Manage logistics for year-round, consistent product quality.

The table below summarizes the core technological applications driving their business segments in fiscal 2025:

Business Segment	Core Technology Application	Operational Benefit	2025 Fiscal Year Impact (9-Month Period)
Prepared (Guacamole)	Ultra-High Pressure (UHP) / HPP	Extended shelf-life (up to 60 days); Clean-label preservation; Food safety.	Prepared Segment Gross Profit up 27% (due to efficiencies and volume).
Grown (Fresh Avocados, etc.)	State-of-the-Art Ripening & Sorting	Consistent ripeness level; Reduced per-pound handling costs for large crops.	Supports a 6% rise in Fresh Segment sales (9-month period).
Corporate Governance	Internal ESG Data Management System	Auditable, verifiable ESG metrics; Integration into financial reporting.	Supports goal for independent ESG disclosure verification by 2025.

Finance: Review the Q4 2025 earnings release for any updated R&D or capital expenditure figures related to technology and operational efficiency.

Calavo Growers, Inc. (CVGW) - PESTLE Analysis: Legal factors

Incurred $4.2 million in Q3 2025 discrete costs from a temporary FDA detention hold on imports

You need to be acutely aware of the immediate, tangible costs of cross-border regulatory friction. Calavo Growers, Inc. (CVGW) took a direct hit in the third quarter of fiscal 2025 (Q3 2025) when a temporary Food and Drug Administration (FDA) detention hold was placed on certain avocado imports from Mexico. This wasn't a minor inconvenience; it translated into approximately $4.2 million of discrete, non-recurring costs for the Fresh segment.

Here's the quick math: The Fresh segment's gross profit for Q3 2025 was $12.4 million, a 32% decrease from the prior year, and the detention costs were a primary driver. This single, isolated event-resolved by September 2, 2025-highlights the significant financial risk tied to international supply chain compliance and customs clearance.

The $4.2 million charge covered a few things:

• Third-party inspection and testing costs.
• Incremental logistics and handling expenses.
• Inventory write-downs on fruit diverted or sold at distressed prices.

Mexican Federal Court recognized Calavo de Mexico as a maquila, aiding tax recovery efforts

On the flip side of international legal risk, Calavo Growers achieved a significant legal win in Mexico in August 2025. A Federal Court formally recognized Calavo de Mexico (CDM) as a maquila (a type of company that imports raw materials duty-free for manufacturing/processing and then exports the finished product).

This recognition is defintely a positive development. It strengthens Calavo Growers' position to recover Value-Added Tax (Impuesto al Valor Agregado or IVA) receivables from the Mexican tax authorities (SAT), which have been subject to delays and detailed reviews since fiscal 2014. Plus, it bolsters their defense in a long-standing 2013 tax assessment.

Compliance required with the FDA's Food Safety Modernization Act (FSMA)

Compliance with the FDA's Food Safety Modernization Act (FSMA) is non-negotiable for a food company of this scale. While Calavo Growers states that all its U.S. facilities are in compliance with FSMA, the regulatory scrutiny extends to its entire supply chain, including contracted farms.

A recent example shows where the risk lies: an October 2024 FDA Warning Letter cited violations of the FSMA's Produce Safety Regulation at a contracted papaya farm. The key violation was the failure to provide adequate, readily accessible toilet facilities for workers in growing areas, a repeat offense from a 2023 inspection. This is a serious issue because it can lead to the product being deemed 'adulterated' under the Federal Food, Drug, and Cosmetic Act.

The legal and compliance mandate is clear: you must enforce FSMA standards across all third-party suppliers, not just your own packinghouses. The risk of product adulteration is real.

Subject to stringent California state laws on water usage and pesticide application

Operating in California means navigating some of the country's most stringent environmental and agricultural laws. Calavo Growers' California operations are subject to oversight by the California Department of Food and Agriculture (CDFA), which covers everything from weights and measures to pesticide application.

The near-term focus in 2025 for California avocado growers is managing water use and pest control under increasing regulatory pressure. Growers are advised to monitor pesticide permits closely to avoid renewal delays. Looking ahead, the company is already preparing for new climate disclosure laws taking effect in California in 2026, which will expand the scope of required reporting on their carbon footprint and supply chain impacts.

This table summarizes key legal and regulatory risks and their financial or operational impact as of 2025:

Legal/Regulatory Factor	Status/Impact (FY2025)	Financial/Operational Detail
FDA Detention Hold (Mexico Avocados)	Resolved; High discrete cost incurred.	$4.2 million in discrete costs in Q3 2025; impacted Fresh segment gross profit.
Maquila Recognition (Calavo de Mexico)	Favorable Federal Court ruling in August 2025.	Strengthens position for IVA (VAT) recovery and defense in a 2013 tax assessment.
FSMA Produce Safety Regulation	Compliance risk demonstrated by October 2024 Warning Letter.	Cited for repeat violation (inadequate toilet facilities) at a contracted papaya farm; risk of product adulteration.
California Environmental Laws	Ongoing compliance; preparation for new laws.	Subject to CDFA regulations on water/pesticides; preparing for new 2026 California climate disclosure laws.

The next concrete step is for the Compliance and Operations teams to review the lessons learned from the Q3 2025 FDA detention and the recent FSMA warning letter to formalize a new, auditable 90-day compliance checklist for all international imports and contracted farms.

Calavo Growers, Inc. (CVGW) - PESTLE Analysis: Environmental factors

You're looking for the hard numbers on Calavo Growers, Inc.'s environmental performance as of 2025, and the reality is that their core business-fresh produce-is inherently exposed to climate risk, but they are aggressively moving to mitigate it with clear, near-term targets. The company is strategically positioned to meet its 100% sustainable packaging goal this year, but the long-term risk from weather volatility remains a critical factor that directly impacts supply and margins.

Goal to validate 100% of packaging as recyclable, reusable, or compostable by 2025.

Calavo Growers has a firm, near-term goal to validate that 100% of its packaging is either recyclable, reusable, or industrially compostable by the close of the 2025 fiscal year. This is a crucial move, as consumer and retailer demand for sustainable packaging is no longer a preference but a mandate. The goal is part of the broader Sustainable Agriculture pillar of their ESG strategy, which also includes a target to migrate at least 50% of packaging components to recycled content (by volume) by 2030. This strategy helps them manage costs and maintain access to major customers like Walmart, which accounted for approximately 12% of total net sales in 2024.

Climate change poses a direct risk from weather events like droughts and wildfires impacting supply.

Honestly, for a company whose revenue is tied to fresh produce like avocados and tomatoes, climate change is an existential business risk, not just a sustainability metric. Calavo Growers explicitly lists 'risks associated with the environment and climate change, especially as they may affect our sources of supply,' and 'the impact of weather on market conditions' in its 2025 financial filings as factors that could materially alter results. You saw this play out in the first half of fiscal year 2025, where the Fresh segment saw a 16.0% decline in avocado volume in Q2 2025, which was offset by a 40.6% increase in average price per carton, but still indicates supply volatility.

Here's the quick math on the risk exposure:

• Avocado production, particularly in California, faces pressure from increasing water costs and restrictions due to drought.
• Supply chain disruptions from extreme weather events directly threaten the distribution of the 409 million pounds of avocados, tomatoes, and papayas the company handled in fiscal year 2024.
• The company must manage its supply chain across multiple geographies, including Mexico, which adds complexity when weather events hit a single sourcing region.

Target to achieve carbon neutrality for Scope 1 and 2 emissions by 2027.

The company has set an ambitious climate action goal to achieve carbon neutrality for its Scope 1 (direct) and Scope 2 (indirect from purchased energy) emissions by 2027. This is a significant commitment, especially considering the baseline for their broader carbon reduction goal is 2022. Achieving this goal requires substantial capital investment in renewable energy, energy efficiency, and potentially carbon offsets.

The 2027 goal is part of a larger plan to reduce the total carbon footprint by 50% by 2030 across Scope 1, 2, and 3 emissions (against a 2022 baseline).

Climate Action Target	Goal	Baseline/Context	Deadline
Scope 1 & 2 Emissions	Achieve Carbon Neutrality	Targeted 0 emissions (net)	2027
Total Carbon Footprint (Scope 1, 2, & 3)	Reduce by 50%	Against a 2022 baseline	2030
Food Waste	Reduce by 50%	Against a 2022 baseline	2030

What this estimate hides is the cost of transitioning from traditional energy sources, but the long-term benefit is a reduced exposure to volatile energy prices.

Reduced average daily water use by 34% in the Uruapan facility.

A concrete win on the environmental front is the significant reduction in water use at the Uruapan, Mexico facility, a key processing center. The company successfully lowered its average daily water use by 34% through a targeted employee engagement program. This reduction was achieved over a six-month period and involved specific operational changes, which is defintely an actionable model for other facilities.

The water savings were driven by a few clear actions:

• Installation of new water meters for better tracking.
• Upgrading 90% of faucets to more efficient models.
• Switching to smart toilets in employee facilities.

This kind of efficiency is critical for a food producer, especially in water-stressed regions, and it shows that targeted, low-cost operational improvements can yield substantial environmental and financial returns. The Uruapan facility has also received the Clean Industry Distinction for meeting all environmental requirements for water consumption and other factors for ten consecutive years.

Next Step: Finance and Operations should draft a capital expenditure proposal by the end of Q4 2025 to scale the Uruapan water-saving equipment upgrades to at least two other high-water-use facilities by Q2 2026.