While Australian millennials are forfeiting their house deposits to pay for smashed avocado, elsewhere in the world authorities are worried about how much forest land is being lost to make way for orchards of the popular fruit.

Key points: Mexico's Michoacan forest, world's top producer of avocados, clears 20,000 hectares each year for agriculture

Mexico's Michoacan forest, world's top producer of avocados, clears 20,000 hectares each year for agriculture Up to 40 per cent of that is for avocado orchards, which use twice as much water as forest vegetation

Up to 40 per cent of that is for avocado orchards, which use twice as much water as forest vegetation Many species, including the monarch butterfly, rely on the forest habitat for survival

In Mexico, the environmental department has raised concerns that deforestation caused by the expansion of avocado orchards is much higher than previously thought.

Talia Coria, an official in the attorney-general's office for environmental protection, said almost 20,000 hectares of forest land were converted to agricultural uses each year in the western state of Michoacan, the world's top producer of avocados.

Ms Coria said 30 to 40 per cent of the annual forest loss was due to avocados.

Experts say a mature avocado orchard uses almost twice as much water as fairly dense forest, meaning less water reaches Michoacan's legendary crystalline mountain streams on which trees and animals in the forests depend.

Species like the monarch butterfly also rely on Michoacan forest as habitat, but Ms Coria said there did not appear to have been damage to the monarch wintering grounds from avocado expansion yet.

Guillermo Haro, the attorney-general for environmental protection, said Michoacan grew about eight out of 10 avocados exported worldwide, but added that the state's forests were "a wealth greater than any export of avocados".

Mexico's National Institute for Forestry, Farming and Fisheries Research had previously estimated the loss of forest land to avocado planting at about 690 hectares a year from 2000 through 2010.

However, the rising popularity of the fruit and higher prices have apparently lured growers to expand orchards faster in recent years.

Avocado trees flourish at about the same altitude and climate as the pine and fir forests in the mountains of Michoacan.

The state already has about 150,000 hectares of orchards, and no new permits for cutting down forest to create plantations have been granted in recent years.

Jobs needed as alternative to drug production

The largely impoverished state depends on avocado growing and harvesting for jobs and income as an alternative to the rampant production of synthetic drugs that also exists in the state.

"That is why we are sitting down now with all the parties involved to find a way to continue this industry of avocado growing, which provides a lot of jobs and income for the state, in harmony with the conservation of our natural resources," Ms Coria said.

Ms Coria said authorities had begun meetings with avocado producers to discuss the problem of deforestation.

"We are going to search for a way … to ensure that all avocados exported are legal, and that the environment has not been affected by their production," she said.

"The avocado growers appear to be convinced that we have to find options for conserving the environment."

However, she said there were no concrete plans yet for any kind of certification of sustainable avocado growing.

"It is hard to know which avocado comes from recognized orchards and which comes from illegal plantings," Ms Coria said.

She noted that other agricultural sectors, such as berry and peach farms and cattle ranches, had contributed to deforestation in Michoacan.

AP