Production in Spain Expected to Fall Short of Initial Estimates

Production estimates range from 680,000 to 755,000 tons for the 2023/24 crop year, below expectations at the start of the harvest.
An olive mill in Huelva, Spain
By Ofeoritse Daibo
Jan. 29, 2024 14:14 UTC

According to a pre­lim­i­nary esti­mate from Spain’s Cooperativas Agro-ali­men­ta­rias, the 2023/24 crop year has met expec­ta­tions, albeit nar­rowly.

In a mar­ket bul­letin pub­lished at the end of December, the county’s lead­ing agri­cul­tural union esti­mated that pro­duc­tion would rise to 755,000 tons by the end of the cur­rent har­vest.

In my opin­ion, we will achieve around 680,000 tons or 710,000 tons at best. Since we are already in January, adding 100,000 more tons to the amount already har­vested is very dif­fi­cult.- Juan Vilar, CEO, Vilcon

However, the lat­est fig­ure is below the 766,362 tons Spain’s Ministry of Agriculture, Fisheries and Food pre­dicted in October.

Despite the promis­ing fore­cast, some experts doubt pro­duc­tion will reach 755,000 tons due to unex­pect­edly low oil yields from olives that have already been milled.

See Also:2023 Harvest Updates

In a recent opin­ion col­umn, César Lumbreras, the direc­tor of the agri­cul­tural news pub­li­ca­tion Agropopular, wrote that the olive oil yield is lower than expected, so it will be dif­fi­cult to achieve a final pro­duc­tion of 700,000 tons.”

According to Lumbreras, Spanish olive oil yields are greatly affected by drought and lack of water, and would require rain through­out the win­ter and spring for the trees to recover from the water stress sit­u­a­tion, which they have suf­fered dur­ing the last two sea­sons.”

Approximately 70 per­cent of the country’s olive groves are not irri­gated.

Juan Vilar, the chief exec­u­tive of agri­cul­ture and olive oil con­sul­tancy Vilcon, also doubts that pro­duc­tion will reach 755,000 tons.

He told the Olive Oil Times that since the olive har­vest­ing and milling cam­paign was almost com­plete, it was highly unlikely that Spain would achieve such high yields.

In my opin­ion, we will achieve around 680,000 tons or 710,000 tons at best,” Vilar said. Since we are already in January, adding 100,000 more tons to the amount already har­vested is very dif­fi­cult.”

The total pro­duc­tion already har­vested, up to now, is under 600,000 tons,” he added. If we have to achieve 755,000 tons, we need at least 150,000 tons this January, and the month is almost over. About 85 per­cent of farm­ers have already fin­ished har­vest­ing.”

Regardless of how the 2023/24 har­vest fin­ishes, it will sur­pass the record-low yield of the pre­vi­ous crop year, when Spain pro­duced 664,033 tons.

The slight pro­duc­tion rebound is pri­mar­ily due to the effects of the Iberian peninsula’s his­toric drought being some­what mit­i­gated by rain.

However, large olive oil-pro­duc­ing regions, includ­ing Andalusia and Castilla-la-Mancha, with esti­mates of 550,600 tons and 86,000 tons in October, have fallen short by 30 and 23 per­cent, respec­tively.

Although not all har­vest data has been counted for these regions, the cur­rent esti­mates are dis­cour­ag­ing. As of January 2024, accord­ing to the Ministry of Agriculture, Fisheries and Food, the total har­vest counted was 584,780 tons.

We will have a bet­ter pic­ture in February once the remain­ing 15 per­cent of farm­ers have com­pleted their har­vest,” Vilar said. However, we will achieve no more than 720,000 tons.”


The rea­sons for the two con­sec­u­tive below-aver­age har­vests are due to Spain’s unprece­dented drought and high tem­per­a­tures in May, which dam­aged many olive trees at the time of blos­som­ing and resulted in them not bear­ing any fruit.

Due to the drought, the olive fruit pro­duced this sea­son is 2.5 per­cent less in size than the global aver­age,” Vilar said. This year, all 66 olive-grow­ing coun­tries have been affected. While Spain has seen its fruit shrink by 2.5 per­cent, Tunisia and Portugal have seen a 1.6 per­cent and 1.5 per­cent reduc­tion, respec­tively.”

In the mar­ket, low yields have hit prices hard. The price of olive oil at retail in Spain reg­is­tered an increase of almost 55 per­cent in 2023 com­pared to the pre­vi­ous year, accord­ing to con­sumer price index data from Spain’s National Institute of Statistics.

Separate data from NielsenIQ found that price increases in 2023 were dis­tinct for dif­fer­ent grades of olive oil, with the price for extra vir­gin, vir­gin and non-vir­gin olive oils ris­ing by 79, 69 and 60 per­cent, respec­tively. (The over­all aver­age was brought down due to the far more mod­est olive pomace oil price rises)

The price of olive oil is very high, and this upward trend will con­tinue for a few months,” Vilar said. There are three main rea­sons: The first is that pro­duc­tion is low. The sec­ond is the weather. Unless it improves with more rain, prices will not change. Thirdly, the prices in the super­mar­ket are from the last batch from the farm.”

Olive oil arrives at the super­mar­ket from its ori­gin in lots or batches, and the price has already been set at €9,” he added. Therefore, prices will not change until the batch is fin­ished.”

In other words, prices at the ori­gin are affected by the olive oil stocks, the progress of the har­vest and how real­ity com­pares to expec­ta­tions and weather fore­casts.

Meanwhile, retail prices reflect the ori­gin prices when the pur­chase orders were made, plus what­ever mar­gin is added by bot­tlers, whole­salers and retail­ers along with Value-Added tax.

Olive oil sales in the domes­tic mar­ket have fallen sig­nif­i­cantly due to the increase in prices to con­sumers,” Lumbreras wrote. Likewise, sales abroad have decreased for the same rea­son. We are, there­fore, fac­ing dif­fi­cult months in the olive sec­tor.”

Vilar agreed that higher prices have affected con­sumers. This has changed buyer behav­ior,” he said. Consumption has declined by 47 per­cent. Spanish cus­tomers are still buy­ing, but now in smaller quan­ti­ties and smaller bot­tles. They buy weekly instead of monthly.”

Some spec­u­la­tors have sug­gested that the Ministry of Agriculture, Fisheries and Food’s higher fore­cast may be a way for the min­istry to boost con­sumer opti­mism while reduc­ing domes­tic mar­ket prices.

At a recent event, Luis Planas, the agri­cul­ture min­is­ter, urged pro­duc­ers to main­tain their efforts, and mar­keters to build con­sumer loy­alty and main­tain sta­ble prices so that con­sumers do not stop demand­ing olive oil.”


Related Articles