Concerns Mount Over Olive Oil Shortage in Spain

With olive oil stocks expected to run out by the start of the coming harvest and predictions of another low yield, experts anticipate prices to continue rising.
By Daniel Dawson
Jul. 31, 2023 13:47 UTC

Olive oil stocks in the world’s largest pro­ducer could be exhausted before the start of the next har­vest.

The lat­est mar­ket data pub­lished by Spain’s Ministry of Agriculture, Fisheries and Food (MAPA) show that olive oil stocks fell to 455,000 tons at the end of June.

There has never been a sit­u­a­tion like this one where, off the back of a his­tor­i­cally poor har­vest, another one is also expected. We are in a sit­u­a­tion where prices will con­tinue to grow until May of next year.- Juan Vilar, strate­gic con­sul­tant

By com­par­i­son, stocks at the end of June 2022 sat at 809,000 tons, finally arriv­ing at 454,600 tons in September 2022, the last month of the 2021/22 crop year.

We are going to arrive in October with almost zero stock,” Juan Vilar, a strate­gic con­sul­tant for the sec­tor, told Olive Oil Times.

See Also:Global Olive Oil Production Predicted to Rebound

While the olive oil mar­ket his­tor­i­cally tends to expe­ri­ence rel­a­tive inac­tiv­ity in July and August, activ­ity returns in September.

Fears of an olive oil short­age have seen his­tor­i­cally high olive oil prices at ori­gin con­tinue to rise. According to data from Infaoliva, extra vir­gin olive oil is sell­ing for €7.625 per kilo­gram, nearly 125 per­cent higher than in July 2022.

Prices for vir­gin olive oil and lam­pante olive oil at ori­gin are also at record highs but have not increased as sharply as extra vir­gin prices due to higher lev­els of avail­abil­ity rel­a­tive to demand.

Unprecedented sit­u­a­tions are occur­ring right now,” Vilar said. The cur­rent prices have never been reached. There has never been a link [the amount of olive oil car­ried over from one har­vest to the next] like the one that there is cur­rently. And there has never been a price on the shelf like the one that there is cur­rently.”

How olive oil prices will evolve in the com­ing months depends pri­mar­ily on whether rain arrives in the Andalusian olive groves in September, October and early November.

That rain has two effects,” Vilar said. It will improve the weight of the exist­ing olives, which could increase pro­duc­tion a lit­tle. But it also has another prob­lem: if it rains dur­ing the cam­paign, it will cause the price to rise more” because it will not be pos­si­ble to har­vest all the olives on time.

Alarm bells about the sit­u­a­tion fac­ing the olive oil mar­ket also sounded in Brussels, home to the European Commission, where var­i­ous agri­cul­tural groups warned about the state of the olive oil sec­tor at a recent meet­ing of the Civil Dialog Group on the Agricultural Market.

A rep­re­sen­ta­tive from Copa-Cogeca, the influ­en­tial union of farm­ers and agri­cul­tural asso­ci­a­tions, pre­dicted that Spain’s har­vest in the 2023/24 crop year would not exceed 800,000 tons, which would keep pres­sure on prices.

Vilar agreed that next year’s olive oil yield will be sim­i­lar to the 663,000 tons pro­duced by Spain in 2022/23. As a result, he said prices would likely con­tinue ris­ing until May.

There has never been a sit­u­a­tion like this one where, off the back of a his­tor­i­cally poor har­vest, another one is also expected,” he said. We are in a sit­u­a­tion where prices will con­tinue to grow until May of next year.”

A Federation of the E.U. Olive Oil Industry (Fedolive) rep­re­sen­ta­tive also warned that yields in Greece and Portugal, Europe’s sec­ond and fourth-largest pro­duc­ers last year, respec­tively, are also expected to decline.

While the prospect of back-to-back below-aver­age har­vests in Europe has caused con­cern in Spain and Brussels, ris­ing olive oil prices resulted in record-high sales by value for two of the world’s largest sell­ers in 2022: DCOOP and Jaencoop.


Cristóbal Cano, head of the olive and olive oil sec­tor at the Union of Small Farmers (UPA), also has been bull­ish about the mar­ket and said high prices are not hurt­ing demand.

The mar­ket­ing of olive oil con­tin­ues to be launched despite all the doom­say­ers who, month after month, have been inten­tion­ally insist­ing that the mar­ket­ing of olive oil suf­fers because con­sumer prices are very high,” he told Agroinformación.

All the olive oil that is pro­duced is sold, and even more so in a cam­paign as low as the one we have expe­ri­enced, and there is no price prob­lem because the con­sumer remains faith­ful to olive oil,” Cano added.

However, Fedolive warned the European Commission that demand and exports had not seen the impact of higher prices since com­pa­nies have hes­i­tated to pass those prices on to their cus­tomers, but this was likely to change.

The fed­er­a­tion said the expec­ta­tions of another poor har­vest in Europe would force non-European importers to look else­where and cause some con­sumers to seek cheaper alter­na­tives.

These new trade rela­tions would be harm­ful in the long run for E.U. pro­duc­ers,” the rep­re­sen­ta­tive said. At the inter­na­tional level, there are many other alter­na­tives to olive oil that con­sumers are more prompted to choose.”

While Vilar does not dis­pute that real olive oil demand is about as high as it could be, he said a recent analy­sis con­ducted by his firm, Juan Vilar Strategic Consultants, found that poten­tial demand is far greater and con­sumers were buy­ing less olive oil than they oth­er­wise would due to higher prices.

People are remain­ing faith­ful to olive oil [instead of buy­ing sun­flower oil, the other main edi­ble oil used in Spain], but they are buy­ing olive oil in smaller for­mats and con­sum­ing it less gen­er­ously,” he said.

Vilar added that while olive oil sales remain strong rel­a­tive to cur­rent avail­abil­ity, the mar­ket faces a par­tial short­age because not every­one who wants to buy olive oil can do so. This sit­u­a­tion will likely be exac­er­bated as stocks can­not be replen­ished and prices con­tinue to rise.

In the com­ing har­vest, we are going to have a sit­u­a­tion where all the olive oil that is pro­duced each month is com­pletely con­sumed that month,” he said. The less oil there is and the higher the con­sump­tion, the more the prices rise.”


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