`Farmers and Consumers React to Rising Olive Oil Prices - Olive Oil Times


Farmers and Consumers React to Rising Olive Oil Prices

By Thomas Sechehaye
Jun. 5, 2023 16:45 UTC

According to com­mod­ity pric­ing data from the International Monetary Fund, global olive oil export prices hit a record high at the end of April.

The IMF’s bench­mark extra vir­gin olive oil export price reached $6,269.63 at the end of April 2023, eclips­ing the pre­vi­ous record price of $6,241.91 in December 1996.

As with many other com­modi­ties, prices will have to increase as the cost of pro­duc­tion does as well. - Casey Corn, food con­sul­tant

Export prices are largely dri­ven by prices at ori­gin, specif­i­cally in Spain, the world’s largest olive oil-pro­duc­ing coun­try.

Poor weather and pro­longed drought con­tinue to push Spanish olive oil prices at ori­gin to their high­est lev­els in the past 26 years. Experts pre­dict record-high prices to con­tinue for the fore­see­able future.

See Also:As Spain Fights Food Inflation, Pressures Keep Mounting

According to Reuters, dry weather has resulted in 36 months of low rain­fall. Scorching con­di­tions have put Spain’s reser­voirs at 50 per­cent capac­ity.

Spain’s Ministry of Agriculture, Fisheries, and Food said the coun­try pro­duced only 680,000 tons in the 2022/23 crop year com­pared to 1.5 mil­lion tons in the pre­vi­ous one.

Despite recent rain in south­ern and east­ern Spain, fore­casts for the 2023/24 crop year remain grim. Without weather changes, indus­try experts pre­dict the future har­vest could pro­duce another poor yield.

John Cancilla, an econ­o­mist study­ing olive oil, told The Washington Post that higher prices are slow­ing demand from American buy­ers. Prices are high, but I don’t see any rea­sons why they are going to come down,” he said.

Along with Spain, which is respon­si­ble for nearly half the world’s olive oil pro­duc­tion in any given year, sus­tained drought resulted in poor har­vests across the Mediterranean basin, dri­ving high olive oil prices.

According to the International Olive Council, global olive oil pro­duc­tion is expected to fall to 2.73 mil­lion tons in the 2022/23 crop year, more than 12 per­cent below the five-year aver­age, largely due to drought and high spring­time tem­per­a­tures in the Mediterranean basin.

Separate esti­mates from the United States Department of Agriculture fore­cast a rebound in pro­duc­tion in the 2023/24 crop year to 3.20 mil­lion tons. However, USDA econ­o­mists warned that pro­duc­tion might fall below the esti­mate depend­ing on how the drought in the Mediterranean devel­ops.

Outside of the Mediterranean, California is also strug­gling with cli­mate change, and like Spain, no relief is in sight.

According to The Washington Post, California farm­ers are expe­ri­enc­ing extremely moist con­di­tions after a del­uge of rain. In late win­ter and early spring, storms blasted through California, pro­duc­ing intense flood­ing and dev­as­tat­ing down­pours.

Weather can make or break the entire season’s pro­duc­tion,” Samantha Dorsey, pres­i­dent of McEvoy Ranch in Petaluma, told The Washington Post.

The results are still unknown, as wet con­di­tions may impact a later bloom for the olive crop in California.

Casey Corn, culi­nary con­sul­tant and olive researcher, told Food & Wine Magazine that the chang­ing cli­mate is absolutely going to result in the volatil­ity of olive pro­duc­tion.”


With uncer­tain tem­per­a­ture pat­terns and weather events increas­ing in inten­sity, our crops aren’t fac­ing the same pre­dictable envi­ron­ments that we’ve built infra­struc­ture and busi­nesses around,” she added.

The chang­ing cli­mate cre­ates fur­ther issues for olive oil pro­duc­ers and con­sumers. The envi­ron­ment is fun­da­men­tal to the qual­ity and fla­vor of the food.

Flavor is pro­tected with cer­ti­fi­ca­tions like AOP [Controlled Designation of Origin, in France], PDO [Protected Designation of Origin], DOC [Controlled Designation of Origin, in Italy],” said Corn. Larger olive pro­duc­ers may need to sup­ple­ment smaller crops with olives from dif­fer­ent loca­tions, which may impact the fla­vor of the prod­uct.”

Olive oil grow­ers are seek­ing solu­tions, accord­ing to Jennifer LeClair, vice pres­i­dent of pur­chas­ing and oper­a­tions at Pastene, a U.S.-based spe­cialty food importer. Growers will need stronger invest­ments in irri­ga­tion tech­nol­ogy for when the weather isn’t coop­er­at­ing and best for olive growth,” LeClair told Food & Wine Magazine.

Rivulis is one irri­ga­tion tech­nol­ogy com­pany trans­form­ing the way farm­ers irri­gate crops. The pio­neer­ing drip irri­ga­tion sys­tem enables farm­ers to expand crops, includ­ing olives, wal­nuts, almonds, toma­toes and corn.

In a Rivulus video inter­view, Luis Javier Fernández Villalobos, a tech­ni­cian at Agrofervi Explotaciones Agrícolas, describes drip irri­ga­tion as the key to good crop qual­ity in his Spanish olive orchard.

Successful drip irri­ga­tion requires uni­for­mity, which is crit­i­cal to the crop’s qual­ity, taste and appear­ance.

We grow rain-fed and irri­gated crops, but mainly irri­gated inten­sive [high-den­sity] crops,” Villalobos said. Drip irri­ga­tion is com­pletely chang­ing the crops we can grow. It guar­an­tees we pro­duce crops of excel­lent qual­ity.”

While con­sumers con­tinue to enjoy the ben­e­fits of olive oil, ris­ing prices and decreas­ing vol­ume can inspire new culi­nary explo­rations.

I hope that farm­ers will con­tinue to inno­vate as the cli­mate keeps chang­ing,” Corn told Olive Oil Times. As with many other com­modi­ties, prices will have to increase as the cost of pro­duc­tion does as well. While con­sumers are used to a range of prices in olive oils and the abil­ity to pri­or­i­tize value over qual­ity, this will most likely change.”

I believe that olive oil has become irre­place­able in American kitchens and that con­sumers will con­tinue to pur­chase olive oil,” she added. We may find that peo­ple begin expand­ing the vari­ety of oils used in their kitchens, and that they start using dif­fer­ent oils for dif­fer­ent cook­ing tech­niques, but that they still pur­chase olive oil as a famil­iar, and deli­cious, prod­uct.”


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