Investigators from the European Commission said that spring rainfall in Spain had led to excellent flowering. Assuming conditions remain amenable for drupe development, the commission predicts another high yield in the world’s largest olive oil producing nation. Spain produced 1.12 million tons of olive oil in 2019/20.See more: 2020 Harvest Updates
On the other hand, a dry spring in some of Italy’s major producing regions and a heatwave in Greece are likely to lead to smaller harvests. Last crop year, the two countries harvested 365,000 tons and 275,000 tons, respectively.
Portugal is also anticipating a slightly smaller harvest in 2020 than it had in 2019, when the country produced a record-high 140,500 tons. However, the commission expects the country’s production will continue to trend upward.
The commission also estimates that overall olive oil consumption in the E.U. will increase by six percent in the 2020/21 crop year.
“An increase in home cooking due to COVID-19 measures led to a rise in retail sales of olive oil, in particular in the main E.U. producing countries, and in the use of olive oil in the food industry (e.g. for canned goods),” the investigators wrote in the report. “In non-producing E.U. countries, sales could likely decrease as a result of a lower purchasing power.”
Along with consumption, the volume of exports is also expected to grow by 10 percent. However, the failure of olive oil prices to recover throughout the bloc means that the value of those exports will be 24 percent lower than the current crop year.
“There were positive signals pointing toward a price stabilization early this year following the activation of private storage aid,” investigators wrote. “However, Jaén prices of virgin and extra virgin olive oil started to decline again at the beginning of the COVID-19 crisis in March.”
There is some optimism that prices will rebound later in the year. The commission estimates that olive oil stocks in the trading bloc will fall to 609,000 tons by October, which would help stabilize the current supply with the demand.