`Producer Prices Lowest Since 2009 - Olive Oil Times
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Producer Prices Lowest Since 2009

By Julie Butler
Jun. 7, 2012 21:05 UTC
Summary Summary

The European Commission-sub­si­dized mar­ket with­drawal of olive oil has not increased prices, which remain at their low­est lev­els since 2009, with extra vir­gin olive oil prices drop­ping in Spain, Greece, and Italy. The International Olive Council reported a decline in olive and pomace oil imports into Canada and Australia, with the US show­ing only a 1% increase in imports, while China, Russia, and Brazil have expe­ri­enced growth in imports.

The lat­est round of European Commission-sub­sidised mar­ket with­drawal of olive oil has failed to rally prices, which the International Olive Council says remain at their low­est lev­els since 2009.

According to its May mar­ket newslet­ter, extra vir­gin olive oil prices are 11 per­cent lower in Spain (€1.77/kg), 10 per­cent in Greece (€1.84/kg) and 39 per­cent in Italy (€2.38/kg), com­pared with the same six months last sea­son,

“In recent months, prices have flat­lined in Greece and remained vir­tu­ally steady in Spain while perk­ing slightly in Italy. Even so, they are at their low­est lev­els since October 2009 in all three coun­tries,” the IOC says.

Prices for refined olive oil are at their worst for the last three crop years and the gap between the price of refined olive oil andex­tra vir­gin olive oil is now about €0.07/kg in Spain and €0.59/kg in Italy.

World olive oil and pomace oil mar­ket

In its April newslet­ter, the IOC described as ​“wor­ry­ing” a decline in olive and pomace oil imports into Canada and Australia. Now it reports that Canadian imports have recov­ered slightly, though they are still down 14 per­cent this October – March com­pared to a year ago, while imports into Australia are up 2 per­cent.

The world’s lead­ing importer, the United States, shows an increase of just 1 per­cent for the first six months of the 2011/12 sea­son, but the fig­ures are more promis­ing for China, Russia and Brazil with respec­tive growth of 22, 16, and 6 per­cent. Earlier this week, the IOC called for ten­ders for a €600,000 ($754,000) pro­mo­tion cam­paign in Japan, where growth is up 7 per­cent.

Imports into and within the EU are also down. The for­mer by 15 per­cent, ​“which comes as no sur­prise given the vol­ume of EU pro­duc­tion this sea­son” the IOC said.

World table olive mar­ket: imports rise in Brazil alone

Table olive imports for October – March are lower for most coun­tries — except into Brazil, where they’ve climbed 23 per­cent. They held steady in Canada but fell 9 per­cent in the US, 4 per­cent in Russia and the EU, and 2 per­cent in Australia.

Argentina: olive oil exports up but con­sump­tion down

This month’s newslet­ter pro­files Argentina, the loca­tion for three IOC meet­ings next month. The 18th extra­or­di­nary ses­sion of the IOC Council of Members will be held in Buenos Aires July 2 – 6, and both the 39th meet­ing of the IOC Advisory Committee and a meet­ing of qual­ity con­trol agree­ment sig­na­to­ries on July 2.

The IOC’s only South American mem­ber, Argentina, joined in 2009. According to Codex Alimentarius doc­u­ments, one of its rea­sons was to ​“show that Argentine olive oils are authen­tic”, even when their fatty acid pro­files dif­fer from the typ­i­cal Mediterranean ones and fall short of IOC para­maters designed to detect adul­ter­ation. Because some oils from Argentina’s new pro­duc­tion areas have low oleic acid val­ues and high linoleic acid ones, it has been push­ing for changes to rel­e­vant para­me­ters.

The IOC newslet­ter, mean­while, says olive oil pro­duc­tion has risen sharply in the last ten years in Argentina ​“albeit more in rel­a­tive terms than absolute terms”, given the 275 per­cent growth amounts to just 11,000 tons.

Exports, largely in bulk and of extra vir­gin grade, have shot up 175 per­cent in a decade. Half go to the US and 40 per­cent to Brazil.

But there’s been a down­turn in Argentine olive oil pro­duc­tion since it reached a high of 27,000 tons in 2007/08, which ​“can very prob­a­bly be explained in part by orchard con­ver­sion to pro­duc­tion for table olives” the IOC said.

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While domes­tic olive oil con­sump­tion slipped 17% in the last ten years, table olive con­sump­tion soared 180 per­cent to reach 35,000 tons last sea­son and table olive pro­duc­tion has hit 250,000 tons. Exports are prin­ci­pally to Brazil.

“Argentina offers excel­lent nat­ural con­di­tions for the devel­op­ment of olive cul­ti­va­tion. Two yard­sticks can be used to mea­sure its poten­tial: the expo­nen­tial growth in the num­ber of advanced genet­ics trees and the growth in Argentine exports, par­tic­u­larly to the two key mar­kets of the United States and Brazil,” the newslet­ter says.

Market with­drawal of olive oil

The EC opened the first ten­der for the lat­est round of pri­vate stor­age aid on May 31 and has already received bids to take a total of more than 86,000 tons of vir­gin olive oil (of which 413 tons is extra vir­gin) off the mar­ket for six months.

In an EC com­mit­tee meet­ing today (June 7) the max­i­mum aid to be paid was fixed at 0.65 €/ton/day, hav­ing taken into account ​“the mar­ket sit­u­a­tion and the struc­ture of the ten­ders received,” EC sources said.

New ten­ders will be accepted until June 19 to bring the total up to the max­i­mum 100,000 tons.


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