Heavy Rains Don't Dampen Enthusiasm of Argentina's Olive Oil Exporters

Summary

Unusually heavy rain­fall in Argentina has neg­a­tively impacted much of the agri­cul­tural sec­tor, but olive pro­duc­tion has been largely unaf­fected due to the dry regions where olives are grown. Despite chal­lenges such as cli­mate change and inad­e­quate infra­struc­ture, Argentina’s olive oil indus­try is expe­ri­enc­ing record growth and has the poten­tial to com­pete with lead­ing European pro­duc­ers.

Unusually heavy rain­fall has damp­ened much of Argentina’s agri­cul­tural sec­tor. However, olives have been spared and the pit­ted fruit tra­di­tion­ally asso­ci­ated with the Mediterranean is thriv­ing.

“Very few olive plan­ta­tions have been affected by the flood­ing,” said Luis Javier Magalnik, an olive pro­ducer and packer at Califruit. ​“The pro­duc­tion zones of olives in Argentina are in regions that are gen­er­ally dry.”

Meanwhile, unprece­dented rain­fall on the Pampas, Buenos Aires, Santa Fe and Cordoba has left five to 10 mil­lion hectares of tra­di­tion­ally pro­duc­tive crop­land com­pletely water­logged.
See Also:More on Argentina Olive Oil Production
Esteban Copati, the head of crop esti­mates at the Buenos Aires Grain Exchange, said at least 650,000 hectares may go unplanted. Whether the rest will dry in time for plant­ing is still unknown.

However, the future of a less tra­di­tional crop is look­ing bright. Olive oil has already expe­ri­enced a record growth in both qual­ity and quan­tity. Olive pro­duc­ers, as well as those at the Ministry of Agriculture, are opti­mistic that they can keep the trend mov­ing upwards.

“We are expect­ing to add to regional devel­op­ment, espe­cially for olive pro­duc­tion,” said Nestor Roulet, sec­re­tary of added value at the Argentinian Ministry of Agriculture. ​“Argentina could still add 20 per­cent more value to olive oil exports this year.”

The Department of Agriculture reported that in the first seven months of 2017, export val­ues had increased in value by 117 per­cent.

Frankie Gobbee, CEO and co-founder of the Argentina Olive Group, believes the qual­ity of olive oil could be fur­ther improved to com­pete with lead­ing European olive oil pro­duc­ers.

“Argentina has more than 120,000 hectares ded­i­cated to olives and exports more than 89 per­cent of those as extra vir­gin olive oil,” said Gobbee. ​“We could demon­strate that the extra vir­gin oil from Argentina is equal to or bet­ter than that of many European coun­tries. We have the genet­ics of European olives with bet­ter agri­cul­tural tech­niques and nat­ural resources.”

Argentine olive oil export vol­umes have increased by 93 per­cent com­pared with the same period last year.

Magalnik at Califruit shares the opti­mism about olive oil’s poten­tial. However, he said empha­sis must be on cul­ti­vat­ing and devel­op­ing unique prod­ucts.

“There is great poten­tial for the Arauco vari­ety of extra vir­gin olive oil, which is unique to Argentina,” he said. ​“If olive pro­duc­ers and olive oil man­u­fac­tur­ers work together sup­port­ing the Arauco vari­ety, it would be pos­si­ble to gain world­wide atten­tion for the prod­uct.”

He argued that right now Argentina has the per­fect cli­mate and tech­nol­ogy to pro­duce high-qual­ity olive oil.

Climate sci­en­tists have pre­dicted heat waves for the upcom­ing sum­mer across Argentina. These pre­dic­tions have made Magalnik wary, but not wor­ried.

“Too much hot, dry air could neg­a­tively impact pol­li­na­tion and con­se­quently lower pro­duc­tion,” he said. ​“Until now, though, it seems like the most pro­duc­tive olive-pro­duc­ing regions have not had this prob­lem.”

However, for Gobbee cli­mate is not the con­cern, inad­e­quate infra­struc­ture is. He said this and pro­duc­tion logis­tics must be improved in order to strike a bal­ance between the grow­ing demand for olive oil and its pro­duc­tion.

“Argentina is not yet a major pro­ducer of olive oil because it does not have large enough refin­ing indus­tries,” he said. ​“The olive plan­ta­tions are more than 1,200 km away from the ports. We need to lower the logis­tics costs or pack­age the olive oil in the ports instead of the plan­ta­tions.”

In spite of these grow­ing pains, Argentina is now the largest exporter of vir­gin olive oil in South America and the eighth largest in the world.

• International Trade Centre


• Accuweather