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Jure Susac, an olive farmer from Ljubuski, Bosnia, is seen delivering his harvest to an oil mill in Capljina during the peak season on October 29, 2022.
In a significant update from Spain’s Deoleo, the largest olive oil producer globally, the company reports that the olive oil industry is moving toward recovery after enduring one of the toughest periods in its history. Prices, often referred to as “liquid gold,” are projected to decrease substantially from record highs in the months to come.
The olive oil sector has faced considerable challenges due to prolonged extreme weather events and drought conditions in southern Europe, which have severely impacted olive yields. This crisis has led to soaring prices, causing alarm among both industry experts and consumers.
The rising cost of olive oil, an integral component of the Mediterranean diet, triggered a crisis across the sector, raising concerns about food security and contributing to a notable rise in theft incidents in Spanish supermarkets.
However, forecasts suggest a positive turnaround, as experts anticipate a robust harvest for the 2024-2025 season in major olive-producing nations like Spain, Greece, and Tunisia.
Despite these optimistic signs, Miguel Ángel Guzmán, Deoleo’s chief sales officer, emphasized that it may be premature to declare the crisis resolved. “We’re still experiencing certain pressures on olive oil prices, particularly for premium options like Extra Virgin,” he remarked, citing uncertainties ahead of the upcoming harvest.
Yet, Guzmán expresses a hopeful perspective for the forthcoming months, stating that market stability is expected to return as supply increases with the new harvest.
‘Towards Stability’
Deoleo, known for popular olive oil brands such as Bertolli and Carbonell, characterized the previous summer as a “perfect storm” of difficulties for the sector and called for deep transformations within the industry.
As of November 6, prices for extra virgin olive oil in Andalusia, Spain, had fallen to 6 euros ($6.33) per kilogram, marking a 19% decrease from the previous month and nearly a 35% drop from January’s peak of 9.2 euros.
Spain plays a crucial role in the global olive oil market, contributing over 40% of the world’s production and thereby setting price benchmarks.
Guzmán noted that the anticipated easing of prices might commence between November and January, contingent on stable weather and harvest conditions. “If rains continue to support production levels, we could witness a downward price trend throughout 2025,” he stated.
Deoleo predicts olive oil prices could stabilize at around 5 euros per liter, which would significantly ease market volatility compared to the elevated prices of 9 to 10 euros witnessed in Spanish supermarkets this year.
‘Facing Existential Challenges’
Kyle Holland, a senior market reporter at Expana, noted that industry sentiments remain pessimistic regarding price forecasts. “Many are quite bearish about future pricing,” he said.
Current projections indicate that Spain may produce approximately 1.3 million metric tons of olive oil, a significant increase from last season’s output of around 670,000 to 680,000 metric tons.
In addition to Spain, there are expectations of strong olive harvests in Greece, Tunisia, and Turkey, with reports suggesting that the quality of olives is promising.
Holland noted the widespread skepticism among industry stakeholders regarding the potential for prices to rise amidst the anticipated increases in supply.
Moreover, concerns persist in the sector due to the two consecutive years of drought, compelling the industry to adapt to the threats posed by climate change. Guzmán highlighted that significant investments are being made in innovative agricultural technologies and the development of more resilient olive tree varieties, in recognition of climate change as a considerable risk to the future of olive oil production.
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