Business

Brazilian Politics: 10, Olive Oil: 0

Olive oil producers like Rafael Marchetti find themselves in a catch-22. Whereas their niche food industry is welcomed and needed in Brazil, the political and economic whirlwind sweeping the country doesn't seem like it will end anytime soon.

Brazilian President Michel Temer
Nov. 28, 2016
By Jun Cola
Brazilian President Michel Temer

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Listening to the Olive Oil Times pod­cast (season 3, episode 2) was a staunch reminder of how a charged polit­i­cal atmos­phere can hamper niche, yet promis­ing indus­tries.

During the inter­view, Rafael Marchetti, pro­ducer of olive oil for his fam­i­ly’s com­pany, Tecnoplanta that offers turnkey invest­ment oppor­tu­ni­ties in Brazil’s olive oil sector, reit­er­ated that the cur­rent polit­i­cal and eco­nomic crises plagu­ing the coun­try has stymied growth in his once bur­geon­ing busi­ness.

This came as little sur­prise to me. Over the past six to eight months it has become appar­ent, as I stroll the streets of north­east­ern Brazil, that more infor­mal street ven­dors are sell­ing their goods. To help sup­ple­ment an already insuf­fi­cient min­i­mum wage (R$880 per month, or roughly $263 at the cur­rent exchange rate) people sell corn, pop­corn, candy, French fries, and other random food items and tid­bits to make ends meet. Olive oil? This condi­ment and cook­ing oil does­n’t make the best street hustle in tough times.

Curtis Cord, the pub­lisher of Olive Oil Times, began inter­view­ing Marchetti with a smooth “So, just to break the ice, how do you like President Trump?” Not a con­ven­tional way to open a pod­cast dis­cus­sion con­cern­ing extra virgin olive oil pro­duc­tion in Brazil. However, the polit­i­cal crisis in Brazil is not rad­i­cally dis­sim­i­lar to what tran­spired in the 2016 U.S. pres­i­den­tial elec­tion and has much to do with the one-year decline in olive oil sales in the coun­try.






Bear in mind that the indus­try was still recov­er­ing from a 2013 Proteste study that con­cluded that only 8 out of 19 com­mer­cial­ized extra virgin olive oil brands in Brazil could be gen­uinely con­sid­ered extra virgin. And now, Brazil con­tin­ues to be embroiled in a crisis that’s tear­ing apart not only the niche gourmet extra virgin olive oil indus­try but also the nation as a whole.

So how can the elec­tion of Donald Trump reveal some of Brazil’s polit­i­cal woes at present? Foremost, Trump’s vic­tory per the elec­toral col­lege (no pop­u­lar vote needed) is rem­i­nis­cent of the ouster of Dilma Rousseff, the first female pres­i­dent of Brazil.

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Despite Brazil’s public pros­e­cu­tor find­ing her inno­cent of any crime, Rousseff, who had been demo­c­ra­t­i­cally re-elected in 2014, was removed from office in August. This polit­i­cal drama was par­tially moti­vated by the infa­mous Car Wash inves­ti­ga­tions which have rocked almost every aspect of Brazilian pol­i­tics in the past few years. Insinuations swirled ram­pantly about Rousseff’s involve­ment in either one crime or another. However, in the end, only her most devoted polit­i­cal foes, many of whom remain in office, were ever for­mally impli­cated or charged with actual crimes by author­i­ties.

BBC Brasil recently pub­lished an arti­cle titled Corrida pres­i­den­cial 2018 pode ter Trump brasileiro (Brazil’s 2018 pres­i­den­tial race may see a Brazilian Trump). My response was that they already have a Trump pres­i­dent with this newly installed gov­ern­ment. The polit­i­cal and eco­nomic crises have only wors­ened since Rousseff’s removal. Replacing her was vice-pres­i­dent, Michel Temer. His robust aus­ter­ity pro­posal (MEC 241) aims to put a 20-year freeze on all public expen­di­tures as well as alter the public edu­ca­tion cur­ricu­lum (one of the changes includes a rule that no polit­i­cal debates would be allowed in sec­ondary school).

Protesting Temer’s pro­pos­als, sec­ondary school stu­dents have occu­pied hun­dreds, if not thou­sands, of schools nation­wide, labor unions and social orga­ni­za­tions have taken their demands to the streets, and, as I write, a national strike is being orga­nized for the 25th of November.

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As Marchetti alluded to during his inter­view, the one-year drop in locally pro­duced olive oil sales is directly related to the eco­nomic and polit­i­cal crises that have inten­si­fied over the past year. Data sup­port­ing that cor­re­la­tion are few and far between. Nonetheless, while unem­ploy­ment in Brazil is up to 11.6 per­cent, making it the sev­enth-largest unem­ployed market in a survey of 51 coun­tries, food prices such as black beans, Carioca beans, rice, pota­toes, onions, garlic, and, of course, olive oil, have all risen. Since the start of 2016, Carioca beans, a staple food source, one of the most con­sumed type of beans in Brazil, has risen 54 per­cent.

Inevitably, gourmet extra virgin olive oil pro­duc­ers like Marchetti find them­selves in a catch-22. Whereas their niche food indus­try is wel­comed and needed in Brazil, the polit­i­cal and eco­nomic whirl­wind sweep­ing the coun­try doesn’t seem like it will end any­time soon.

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Despite all, they’re press­ing for­ward, just like the stone wheels used to press olives in the good old days. But now, much of their work involves edu­cat­ing the public about the qual­ity and fresh­ness of locally pro­duced olive oil. Not only does it reduce our carbon foot­print, it can also help to ignite a stag­nate econ­omy.