Trade Recovery Tests Europe’s Olive Oil Producers as Prices Fall

European olive oil exports are forecast to rise 6 percent in the 2025/26 crop year, reaching 794,000 tons, as lower prices help revive demand in global markets after two years of tight supply and record prices.

According to the European Commission’s latest Short-term Outlook, the price decline is already reshaping trade flows. E.U. shipments to China doubled through March compared with the same period in 2024/25, while exports to Brazil, the United Kingdom and Japan also increased.

Exports to the United States declined from the beginning of the crop year, despite the country remaining the world’s largest olive oil importer. The contraction partly reflects dynamics from the previous campaign, when a steep drop in the harvest in Italy restricted traditional flows to the U.S. market and prompted American buyers to diversify procurement toward more competitive non-E.U. suppliers, including Tunisia.

The trade recovery is unfolding even as global consumption remains at a historically high level. According to International Olive Council data presented at the Olive Oil World Congress, global olive oil consumption reached 3.2 million tons in 2024/25, slightly above the latest five-year average of 3.07 million tons. Compared with average consumption levels recorded in the 1990s, global demand has nearly doubled.

Taken together, the figures point to a changing market. Lower prices are helping E.U. exporters reach import-dependent markets where demand continues to grow. However, those same prices are increasing pressure on producers and millers in traditional olive-growing regions, where costs have not fallen in parallel.

According to the Commission, extra virgin olive oil prices in Spain reached €427 per 100 kilograms in October 2025, peaked at €457 in December and fell to €397 by early June 2026. The Commission said expectations of a better 2026/27 harvest in the main producing countries may also be contributing to the decline.

For exporters, the combination of lower prices and broader global demand could mark the beginning of a trade recovery. In many import-dependent markets, olive oil competes as a premium food product, but price still matters. After the sharp increases of recent years, more competitive European prices may help rebuild demand in markets where consumers traded down or reduced purchases.

For many producers, however, the same trend carries a more difficult meaning. Prices are falling while labor, energy, fertilizer, financing, logistics and compliance costs remain elevated. The pressure is especially acute for farmers working with traditional olive groves, smaller mills and less mechanized production systems.

In the heart of Spanish olive oil production, the farmers association ASAJA Jaén warned that, at current price levels, “old olive groves will have no viability whatsoever” in the province. Traditional, lower-yielding and often rainfed groves coexist in a market increasingly dominated by intensive and super-high-density systems that can sharply reduce harvesting costs.

The warning mirrors broader concerns raised at the Olive Oil World Congress by consultant Juan Vilar, who presented research suggesting that more than 22 percent of olive mills in Spain and Portugal could disappear in the next decade. According to the study, the Iberian Peninsula currently has 2,219 olive mills, but just 60 already process one-third of all olive oil production.

The research projected that the region could lose 200 mills within five years and 500 within a decade. If current trends continue, the Iberian milling map could eventually be reduced to 85 facilities concentrating 40 percent of production.

In Italy, the same pressure has produced a broader call for reform. A national committee of growers, millers and producer organizations gathered in Bari to demand stronger controls, support for logistics and quality, and price reporting linked to real production costs.

Participants came from several regions to call for change. The organizing committee warned that Italy’s olive oil heritage risks being weakened by unfair competition, imports produced under lower standards, the market power of large retailers and multinational groups, and rising production costs for high-quality extra virgin olive oil.

The committee’s proposals include an electronic document for bulk oil movements above 100 kilograms, extraordinary checks on operators reporting anomalous turnover growth, public guarantees for bank exposures linked to advances to producers and purchases of recognized Italian olive oil, temporary support for storage costs of traceable Italian oils, logistics support for millers and a dedicated customs storage system for imported olive oil to facilitate controls.

The trade picture is further complicated by imports. The Commission expects E.U. olive oil imports to rise 24 percent year-on-year to 223,000 tons, citing the availability of lower-priced Tunisian olive oil. Tunisia, the E.U.’s main olive oil supplier, is expected to help cover the deficit left by lower Spanish production.

The trade dynamics are unfolding alongside shifting global consumption trends. While Europe still accounts for about 60 percent of global olive oil consumption, its share is gradually declining. The United States imports between 380,000 and 400,000 tons annually, about 35 percent of global imports. Brazil ranks second, with about 80,000 tons per year and 8 percent of global imports, while depending on foreign supply for nearly all of its consumption.

Asia-Pacific is another major growth area. China, Japan, South Korea and India together accounted for 22 percent of global demand growth over the past two decades. With low per-capita consumption, large populations and expanding middle classes, the region is widely viewed as one of the sector’s strongest long-term opportunities.

The IOC expects global olive oil consumption to grow about 0.6 percent annually in volume, while market value is expected to rise faster as premiumization creates opportunities for high-quality olive oil producers.

E.U. production is forecast at just below 2.1 million tons in 2025/26, down 5 percent from the previous crop year but still 9 percent above the five-year average. Spain’s harvest was revised down to about 1.3 million tons after excessive rainfall hampered harvest conditions in the south, while Greece is expected to fall 18 percent. Portugal could increase production by 1 percent, and Italy is estimated to grow 31 percent due to the alternate-bearing cycle of olive trees.

Overall, the report takes a cautiously optimistic view of the next season. E.U. olive oil consumption is expected to return to its five-year average of about 1.4 million tons, while ending stocks are forecast at 394,000 tons.

Looking ahead, favorable weather and water availability during flowering in the main E.U. producing countries point to better 2026/27 harvest prospects, provided no adverse weather events affect the crop.

“Olive oil is no longer solely a Mediterranean product. Today it is consumed all over the world, and the main drivers of demand growth are to be found in increasingly diverse markets,” Jaime Lillo, IOC executive director, said during the latest IOC session in Portugal. “This internationalization calls for greater cooperation, more knowledge-sharing and robust quality standards,” he added.