Spain's Farmers Welcome Low Harvest Forecasts

An official for one of Spain’s main agricultural unions argues that steadily rising global consumption paired with a decrease in production may lead to more demand for Spanish olive oil and cause prices to rise.

Aug. 21, 2020
By Daniel Dawson

Recent News

Spain’s Union of Small Farmers and Ranchers (UPA) has said that the esti­mated decrease in global olive oil pro­duc­tion in the 2020/21 crop year could be a good thing for Spanish pro­duc­ers.

The agri­cul­tural asso­ci­a­tion esti­mates that Spain will pro­duce between 1.4 and 1.5 mil­lion tons of olive oil in 2020/21, a slight improve­ment from last year’s total of 1.25 mil­lion tons.

See Also:2020 Harvest Updates

Cristóbal Cano, the head of olive oil at UPA, said that the olive har­vest was ini­tially expected to be larger, but poor weather in recent months has dried up these prospects.

In our coun­try, after a very dry autumn and win­ter, the spring rains gave the pro­duc­tion sec­tor a break,” he said. However, the devel­op­ment of the sum­mer has been very neg­a­tive, with heat waves that are reduc­ing the olive pro­duc­tion esti­mates day-by-day.”

See Also:Industry Data Dashboard

In spite of many pro­duc­ers prepar­ing for less of a rebound than pre­vi­ously expected, Cano believes that declin­ing global pro­duc­tion may actu­ally have a pos­i­tive impact on the country’s strug­gling olive oil sec­tor.

The United States Department of Agriculture (USDA) has esti­mated that global olive oil pro­duc­tion will reach 3.03 mil­lion tons in the 2020/21 crop year, mark­ing a third con­sec­u­tive year of decline.


Among the coun­tries expected to take the biggest hits are Turkey and Tunisia, both of which are com­ing off near-record har­vests and com­bine for more than one-quar­ter of global olive oil exports.

Along with declin­ing pro­duc­tion, the USDA also pre­dicts that global olive oil con­sump­tion will con­tinue to grow between two and four per­cent. This has led UPA to esti­mate that Spain’s olive oil stocks will fall by 20 per­cent, fin­ish­ing the year at 400,000 tons.

Cano argues that this com­bi­na­tion of fac­tors has the poten­tial to ben­e­fit Spanish pro­duc­ers. Lower pro­duc­tion lev­els in Turkey and Tunisia mean more space in the export mar­ket for Spanish oils.

Additionally, the com­bi­na­tion of falling olive oil stocks and steadily ris­ing con­sump­tion will put a dent in the global glut of olive oil and, Cano hopes, cause prices to rise.

It only remains to be seen if this sit­u­a­tion of dom­i­nance of our oils in world pro­duc­tion will take place with a fair dis­tri­b­u­tion of the value of the prod­uct along the chain, or if again, the pro­duc­tion sec­tor suf­fers ruinous prices,” Cano said.

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