Transportation Strikes in Spain Lead to Decrease in Olive Oil Exports

Summary

The road haulers’ strike in Spain is caus­ing sig­nif­i­cant dis­rup­tions to the dis­tri­b­u­tion of goods in the coun­try, lead­ing to con­cerns about the impact on olive oil exports, which have seen an 80 per­cent reduc­tion accord­ing to the Spanish Association of Olive Oil Exporting, Industry and Commerce. The strike has resulted in a sub­stan­tial increase in olive oil prices in Spain, affect­ing the com­pet­i­tive­ness of Spanish olive oil in the global mar­ket and poten­tially lead­ing to long-last­ing dam­age to the sec­tor, with fears that even after the strike ends, the back­log of goods at ports will cre­ate fur­ther chal­lenges for exporters.

The ongo­ing road haulers’ strike in Spain con­tin­ues to cause alarm as the dis­tri­b­u­tion of goods in the coun­try is dis­rupted.

Along with inter­nal dis­tri­b­u­tion, some offi­cials are con­cerned that olive oil exports are being severely impacted too.

“There has prac­ti­cally been a total ces­sa­tion because we have suf­fered protests out­side of the indus­tries and fac­to­ries, as well as in the entrance of the ports,” said Rafael Pico Lapuente, the exec­u­tive direc­tor of the Spanish Association of Olive Oil Exporting, Industry and Commerce (Asoliva).

“If there hasn’t been a com­plete reduc­tion in exports, then at the very least there has been an 80 per­cent reduc­tion,” he added.

Lapuente warned that the con­sid­er­able export reduc­tion would have severe con­se­quences on the sec­tor since Spain exports three-fourths of the olive oil that it pro­duces.

“If you can’t export and 75 per­cent of the wealth comes from the exports, then we are head­ing down a bad path,” he said.

The strike, which has caused the aver­age olive oil prices to increase immensely in Spain, has com­pounded sup­ply chain dif­fi­cul­ties in other areas of the edi­ble oil mar­ket too. As a result of the war in Ukraine, sun­flower oil prices have risen above €3.00 per liter in Spain, 70-per­cent above aver­age.

Average olive oil prices have also risen. Prices were hov­er­ing around €4.00 per liter until March but have since increased to about €5.00 per liter.

Pico Lapuente pre­vi­ously told Olive Oil Times that high olive oil prices in Spain also hurt exporters as Spanish olive oil becomes less com­pet­i­tive than oils from Italy, Tunisia, Morocco or Turkey.

Along with impact­ing prices, the strike has affected other aspects of the mar­ket, such as the con­sumers.

Although the strike has less­ened recently, Pico Lapuente said a huge part of the dam­age done to the sec­tor is irre­versible.

“The worst thing now isn’t the eco­nomic impact that we can suf­fer while the stop­page lasts; it’s that a lot of our buy­ers who are not able to receive our goods have resorted to buy­ing olive oil from other coun­tries, such as Portugal, Italy or Tunisia,” he said. ​“That is very bad news for us.”

Pico Lapuente said he believes the Spanish gov­ern­ment is respon­si­ble for not tack­ling the con­flict the right way. He added that he is wor­ried that the image of Spain as the world leader in olive oil pro­duc­tion and exports may be dimin­ished.

“The gov­ern­ment has taken a long time to act and nego­ti­ate, and the whole world has suf­fered the con­se­quences,” he said.

Even when the strike ends, Pico Lapuente fears that things will not imme­di­ately go back to nor­mal since the ports are likely to be backed up with an over­load of goods need­ing to be moved.

“Everything that hasn’t been exported before will be exported now,” he said. ​“Since we already needed con­tain­ers and ship­ping com­pa­nies since the clo­sure of the Suez Canal and the eco­nomic cri­sis, the prob­lem will now be big­ger.”

Pico Lapuente said the strike com­pounded sev­eral other fac­tors that are cre­at­ing prob­lems for Spanish olive oil pro­duc­ers, includ­ing the impacts of the Covid-19 pan­demic, the legacy of the cur­rently-paused tar­iffs imposed by the United States and the loss of mar­ket share for Spanish olive oil in Belarus, Russia and Ukraine due to the war.

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