Bumper Harvest Boosts Tunisian Olive Oil Exports Amid Market Volatility

Summary

Tunisia’s olive oil sec­tor is expe­ri­enc­ing a strong har­vest rebound, with expec­ta­tions of a record yield in the upcom­ing crop year and a sig­nif­i­cant increase in exports, although falling prices may impact the over­all value of exports. Efforts are being made to sta­bi­lize prices and sup­port pro­duc­ers in the face of mar­ket chal­lenges, with a focus on main­tain­ing fair prices for farm­ers while keep­ing exports com­pet­i­tive.

Amidst a robust har­vest rebound, Tunisia’s offi­cials and olive oil pro­duc­ers feel bull­ish even as the sec­tor expe­ri­ences grow­ing pains.

The Ministry of Agriculture esti­mates that Tunisia will pro­duce 340,000 met­ric tons in the 2024/25 crop year, the largest yield since the record-high 440,000 tons pro­duced in 2019/20.

As a result, Tunisia’s National Olive Oil Office (ONH) expects exports to climb to 300,000 tons, a 50 per­cent increase com­pared to the pre­vi­ous crop year and the high­est total since 2019/20.

However, falling olive oil prices at ori­gin mean the value of these exports is unlikely to reach the record 5.16 bil­lion dinar (€1.56 bil­lion) in 2023/24.

The ONH also high­lighted that an unprece­dented 28,600 tons of exports in the past crop year were pack­aged olive oil, a sig­nif­i­cant increase from the 9,900 tons in 2022/23.

“Our coun­try has made sig­nif­i­cant efforts in pack­ag­ing our olive oil, which has enabled it to increase the export of pack­aged oil to 15 per­cent of total exports,” Salem Fourati, the vice pres­i­dent of the Tunis-based International Studies Association, wrote in Kapitalis.

He added that Tunisia is well-poised to cap­i­tal­ize on the increas­ing con­ven­tional and organic olive oil con­sump­tion trends.

Even so, Fourati advo­cated for a for­mal part­ner­ship with the European Union, which imported 176,051 tons of mostly bulk Tunisian olive oil in 2022/23, to encour­age the export of indi­vid­u­ally pack­aged Tunisian extra vir­gin olive oil.

However, Fourati also iden­ti­fied some chal­lenges fac­ing the sec­tor. Lower extra vir­gin olive oil prices at ori­gin have long given Tunisia a com­pet­i­tive advan­tage com­pared to its coun­ter­parts on the north­ern shores of the Mediterranean, but this is begin­ning to change.

“Even though our pro­duc­tion prices are lower than those of some European coun­tries… they will expe­ri­ence a slow but cer­tain pro­gres­sion for the farmer’s ben­e­fit, which will encour­age the devel­op­ment of our olive groves,” Fourati wrote.

“Export prices will have to be slightly lower than those in Europe to avoid a mar­ket dis­rup­tion that would be detri­men­tal to all oper­a­tors,” he added.

To main­tain sta­ble prices at an ade­quate level for farm­ers and millers while keep­ing exports com­pet­i­tive, Fourati advo­cated for a flex­i­ble mar­ket sta­bi­liza­tion struc­ture to sup­port pro­duc­ers when prices are low and pre­vent prices from ris­ing too high.

“Price con­trol is essen­tial for the future of Tunisian olive oil,” he wrote. The sta­bi­liza­tion struc­ture would ​“inter­vene in the col­lec­tion at a ref­er­ence price fixed for each cam­paign for olive oil which has not found a buyer on the mar­ket and this on con­di­tion of stor­age and pos­si­ble dis­count.”

Fourati added that this sup­port mech­a­nism would require a floor price for exports of extra vir­gin, vir­gin and lam­pante olive oil to improve trans­parency and ​“avoid dubi­ous trans­ac­tions.”

Hamed Dali, the ONH’s chief exec­u­tive, said the orga­ni­za­tion could pur­chase and store 80,000 tons of olive oil to ensure farm­ers receive a fair price.

As prices at ori­gin fell in Spain and Greece, Dali added that the ONH was already pur­chas­ing olive oil at ​“fair mar­ket prices” to release later in the year when prices are more likely to increase.

However, Moez Ben Zaghdan, the Tunisian Union of Agriculture and Fisheries pres­i­dent, warned that this solu­tion may be a blunt instru­ment due to the vari­a­tion in pro­duc­tion costs across the coun­try.

“We can­not cur­rently set the price of olive oil in Tunisia because of the speci­ficity of each pro­duc­tion region and dis­tri­b­u­tion of pro­duc­tion between the dif­fer­ent vari­eties of the olive tree,” he told Kapitalis.

Despite the mar­ket chal­lenges, Ben Zaghdan acknowl­edged that the sit­u­a­tion looks good for olive farm­ers, point­ing to recent rain­fall improv­ing water resources across the coun­try as a pos­i­tive sign for the 2025/26 crop year.

• Kapitalis
• Kapitalis
• National Olive Oil Office