Welcome to the Olive Oil Monthly market update powered by Certified Origins. We will provide you with relevant and transparent information on Extra Virgin Olive Oil (EVOO) and Olive Oil (OO) trends to help you navigate the market.
WHAT IS HAPPENING THIS MONTH
The record heat temperatures and extended draughts experienced in Europe and the Mediterranean are increasing tension and concerns in the food market over future crops. Olive oil trading prices are trending with unprecedented spikes, pushing many operators and producers to halt transactions momentarily. Luckily the thirst for the healthy properties of Extra Virgin Olive Oil and its derivatives remains also sustained, with recent reports showing an increasing consumption.
THE SITUATION IN SPAIN AND ITALY
The continuous lack of rain is afflicting olive groves in Southern Europe and the Mediterranean, causing wildfires and extreme drought. Crops from high-intensive olive farms requiring constant artificial irrigation are the most affected. The trees from medium and low-intensive farms, relying primarily on rainwater, also show signs of damage and stress.
FORECAST FROM CALIFORNIA
In 2021/22, California produced approximately 14,000 Tonnes of Olive Oil, providing a fraction of the Oil consumed in the USA, still mostly imported from the Mediterranean. Despite the continuous efforts of the North American farmers to increase production and quality in this fertile region, the Olive Oil Commission of California expects a drop of 43% for the next crop caused by harsh climate conditions.
PRICE AND MARKET SITUATION
The difficult weather conditions and continued global economic and political uncertainty translated into an unstable olive oil market. We observed record transactions with evaluations as high as 3.90 Eu/kg for conventional (non-organic) Extra Virgin Olive Oil in Spain and 4,90 Eu/Kg for the same grade in Italy. This situation of uncertainty and tension will push many olive oil traders and buyers to halt operations and wait, hoping for more favorable conditions. In August, most of Europe’s olive oil mills and bottling plants are running at low capacity or shut down completely. The updated forecasts on Olive crops in September will be crucial to understanding future market trends
GROWING CONSUMPTION OF OLIVE OIL
According to a report published by the European Commission, demand for Olive Oil and Extra Virgin Olive Oil keeps growing, despite inflation and higher retail prices. With retail and food service as the main drivers, projections for 2023 in Europe set consumption growth at 11% higher than in previous years.
International Olive Council
Olive Oil Times