` Council Predicts Dip in Olive Oil Consumption

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Council Predicts Dip in Olive Oil Consumption

Dec. 6, 2012
By Julie Butler

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A slight reduc­tion in world olive oil con­sump­tion and a 20 per­cent fall in pro­duc­tion are the cur­rent fore­casts from the Inter­na­tional Olive Coun­cil (IOC) for the 2012/13 sea­son.

Accord­ing to updated but pro­vi­sional fig­ures pre­sented at the 40th meet­ing of the IOC Advi­sory Com­mit­tee on Olive Oil and Table Olives, held on Novem­ber 14 and 15, global con­sump­tion is expected to slip from about 3.2 mil­lion tons in 2010/11 to 3.1 mil­lion this sea­son.

Major pro­duc­ers Spain, Italy and Greece — each hard-hit by finan­cial cri­sis — are all fore­cast to see decline in domes­tic con­sump­tion. Of the world’s main olive oil con­sumers, Italy is expected to go from 724,500 tons to 695,000, Spain from 582,100 to 550,000, and Greece from 212,500 to 208,000. The United States, mean­while, is fore­cast to stay at 294,000 tons.

Con­sump­tion to out­strip demand, stocks to dwin­dle

Con­sump­tion is nev­er­the­less pre­dicted to exceed the expected 2.71 mil­lion tons in world pro­duc­tion this sea­son (Octo­ber to Sep­tem­ber), down from 3.40 mil­lion in 2011/12.

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While higher esti­mates of even up to 70 per­cent have been made lately by Span­ish agri­cul­tural groups, the IOC esti­mates Spain’s har­vest this year — hum­bled by harsh weather after 3 bumper crops — will be down 49 per­cent on the pre­vi­ous crop year, to just 820,000 tons.

Declines are also expected in Morocco, from 120,000 to 110,000, Por­tu­gal from 76,200 to 68,600, and Argentina from 32,000 to 17,000 tons.

The world started the 2012/13 sea­son with 916,500 tons in car­ry­over stocks but will end it with only about 387,000 tons, the IOC believes.

Import growth in 2011/12

Accord­ing to the IOC’s Novem­ber mar­ket newslet­ter, pub­lished on Decem­ber 5, olive oil and olive pomace oil imports in 2011/12 grew 38 per­cent in China, 21 per­cent in Japan, 15 per­cent in Rus­sia, and 9 per­cent in Brazil and the US. There was a 1 per­cent decline in Canada.

Ex-mill prices

Com­pared with the same period a sea­son ear­lier, pro­ducer prices for extra vir­gin olive oil started to rise sharply in Spain in late June, reach­ing €2.64/kg by the sec­ond last week of Sep­tem­ber, the IOC newslet­ter says.

They then switched course in the last week of Octo­ber, reach­ing €2.40/kg by the sec­ond last week of Novem­ber. Although this rep­re­sents a 9 per­cent drop from the Sep­tem­ber peak, it is still 27 per­cent higher than a sea­son ear­lier.”

These price move­ments have to be viewed in a con­text where the esti­mates for 2012/13 are becom­ing more accu­rate as the har­vest moves for­ward. It must also be remem­bered that prices have been very low in Spain through the last two crop years and this increase brings them up to the level of March 2008.”

After ris­ing within the space of two months from €2.38/kg, in the first week of August, to €2.90/kg, in the first week of Octo­ber, pro­ducer prices in Italy dropped sud­denly to an inter­me­di­ate level of €2.62/kg, but still up 3 per­cent on the pre­vi­ous sea­son.

In Greece, where prices have risen 15 per­cent over the last three months, the increase has been more even and slower, from €1.82/kg (late July) to €2.24/kg (sec­ond last week of Novem­ber).

The gap between the price of refined olive oil and extra vir­gin olive oil is cur­rently around €0.06/kg in Spain and €0.18/kg in Italy.

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