European Officials See Olive Oil Supplanting Butter, Vegetable Oil Consumption

Producers will ben­e­fit from a steady increase in con­sumer aware­ness about olive oil’s health ben­e­fits cou­pled with the grow­ing pop­u­lar­ity of the Mediterranean diet in the next 10 years, European Union offi­cials pre­dict.

In the bloc’s 2022 – 2032 medium-term out­look, the E.U. agri­cul­ture and rural devel­op­ment depart­ment also ana­lyzed how the growth of the olive oil mar­ket would impact com­pet­ing veg­etable oil mar­kets.

“Olive oil is expected to increas­ingly replace veg­etable oils in food con­sump­tion par­tic­u­larly out­side the main pro­duc­ing coun­tries, dri­ven by a healthy image of olive oil, and an increas­ing pop­u­lar­ity of the var­i­ous Mediterranean cuisines,” offi­cials wrote in the out­look.

“This trend is expected to con­tribute to the decline in demand for veg­etable oils and to affect but­ter con­sump­tion, espe­cially in home cook­ing and food ser­vices,” they added.

Officials pre­dict that the grow­ing demand for olive oil will also con­tinue to fos­ter the expan­sion of olive grow­ing in the main pro­duc­ing coun­tries.

“Among other types of agri­cul­tural land, the area of olives for oil is expected to increase in line with pre­vi­ous trends (to reach close to 5 mil­lion hectares in 2032), with more areas to be cov­ered by irri­gated inten­sive sys­tems, espe­cially in Spain and Portugal, or to be con­verted to organic and qual­ity sys­tems, espe­cially in Italy and Greece,” the out­look authors wrote.

As a result, increas­ing olive oil con­sump­tion in the E.U. has become an estab­lished trend, with International Olive Council data show­ing a steep rise in con­sump­tion across most European coun­tries over the past three decades.

Germany’s con­sump­tion increased from 9,800 tons in the 1991/92 crop year to 76,900 tons esti­mated for 2021/22. In the same period, con­sump­tion in the Netherlands rose from 1,500 to 9,600 tons.

Many other E.U. coun­tries with lit­tle or no his­tory of con­sum­ing olive oil have also seen con­sump­tion rise sig­nif­i­cantly since 1991/92. For exam­ple, con­sump­tion in Poland went from 3,200 tons in 2003/04 to 12,000 tons in 2021/22.

In three decades, olive oil con­sump­tion in non-pro­duc­ing coun­tries in the E.U. has increased from 21,400 to 162,700 tons. In the same period, non-pro­duc­ing coun­tries out­side the European Union have seen their olive oil con­sump­tion grow four­fold, from 246,000 to 1.1 mil­lion tons.

In the next decade, E.U. offi­cials pre­dict that demand for veg­etable oils will be sig­nif­i­cantly affected by biodiesel pro­duc­tion, espe­cially rape­seed oil.

As a result, they antic­i­pate the sun­flower oil mar­ket to grow only in Hungary and Germany, with demand stag­nat­ing across the rest of the European Union.

The offi­cials said the decrease may hap­pen ​“because of con­sumer pref­er­ences shift­ing toward more healthy oils, espe­cially in France.” Other than olive oil, demand for soy­bean oil is also expected to increase.

They pre­dicted that veg­etable oil con­sump­tion would decline from an aver­age of 22.1 mil­lion tons between 2020 and 2022 to 21.2 mil­lion in 2032 as other edi­ble oils replace them and bio­fuel demand dimin­ishes.

“Given the efforts to reduce the use of palm oil, the types of veg­etable oils used in food are also expected to change (a 12.6‑percent increase for rape­seed oil, 27.5 per­cent increase for sun­flower oil, 23.5 per­cent decrease for soya oil and 35.7 per­cent decrease for palm oil),” the offi­cials wrote.

According to the report, in the next 10 years, E.U. coun­tries are expected to pro­vide suf­fi­cient agri­cul­tural out­put to sus­tain food secu­rity in the area.

The net food trade posi­tion of the bloc is expected to grow by 21 per­cent, ​“with high-value food exports more than com­pen­sat­ing for imports of com­modi­ties such as veg­etable oils and ani­mal feed.”

According to the out­look authors, aver­age E.U. house­hold expen­di­ture for food is expected to drop 18 per­cent in the next decade.

While there are mea­sur­able effects on the E.U. food mar­ket due to the con­se­quences of the Covid-19 pan­demic and geopo­lit­i­cal uncer­tainty sur­round­ing the Russian inva­sion of Ukraine, ​“the cur­rent record-high food infla­tion rates are not expected to per­sis­tently impact the aver­age shares of house­holds’ bud­get spent on food over the medium term.”

The offi­cials added that con­sumers would be more likely to spend more money on essen­tial food prod­ucts for cook­ing at home rather than reduce their over­all food con­sump­tion.

“The broader socio-eco­nomic impacts of the recent eco­nomic crises remain uncer­tain, but they can poten­tially con­tribute to increas­ing inequal­i­ties and can cre­ate con­cerns for food afford­abil­ity and food secu­rity,” the out­look con­cluded.