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Spanish Olive Oil Prices Surge

Oct. 22, 2015
Erin Ridley

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The Spanish con­sumers’ group OCU revealed that refined olive oil prices have increased 51 per­cent since May of 2014, jump­ing 20.7 per­cent since just May of this year. Meanwhile, extra vir­gin prices have surged, too, hav­ing risen 50.3 per­cent since October 2012, and 4.3 per­cent in the last month alone.

These results are based on a study of over 20 olive oil brands, many of which are sold at super­mar­kets through­out the coun­try. The cause for the increase in prices is being blamed on low stocks and early spec­u­la­tion about next year’s har­vest.

Last year’s pro­duc­tion was very low, result­ing in over 800,000 met­ric tons of olive oil, ver­sus roughly 1.8 mil­lion the year before. The reduced sup­ply is barely enough to cover demand, leav­ing stock lower than it has been since 2003.

But the OCU believes the ris­ing prices could have more to do with spec­u­la­tion, caus­ing prices to accel­er­ate in the last month — just before the har­vest — in antic­i­pa­tion of a pos­si­ble drought dur­ing the year to come (a real con­cern given that rain­fall in Andalusia’s olive oil-pro­duc­ing regions sits at 25 per­cent below aver­age).

These ele­vated prices could return to lower lev­els with the immi­nent avail­abil­ity of new olive oil from the cur­rent har­vest, fol­lowed more sig­nif­i­cantly in January, when this year’s pro­duc­tion will be bet­ter known, and even more defin­i­tively come June.

Whatever the cause, higher prices will be passed to con­sumers, both domes­ti­cally and inter­na­tion­ally, as Spain exports two thirds of its olive oil.

Spaniards, who con­sider olive oil a fun­da­men­tal part of their daily diet, will surely adjust their con­sump­tion. According to the OCU, in sim­i­lar sit­u­a­tions in the past, Spanish con­sumers have sim­ply replaced olive oil with cheaper alter­na­tives.

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