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 and plan the next moves.
SUNFLOWER OIL CRISIS
The market for Olive Oils has changed dramatically in the last 2 weeks due to the shortage of fats and Seed Oils in Ukraine, the primary producer of Sunflower Oil. The lack of supply has caused a massive demand for other Seed Oil and Refined Olive Oil.
We are in a historical moment where the bulk cost to purchase Refined Oils jumped nearly overnight at levels very close to Extra Virgin Olive Oil. The cost for Refined Oils could soon match or exceed the price for Extra Virgin, an unprecedented turn of event.
EFFECTS ON THE OIL AND FATS MARKET
The tension in the vegetable oil market is exceptional, and its effects are hard to predict. Today, the price for Olive Oil (Non Extra) on the European market trades on average at 3,80 Eu/Kg, while the blended price for Evoo (Spain/ Portugal/ Greece) trends approximately at 0,10 Eu/Kg above. For Italian Evoo, we observed transactions peaking at 4,60 Eu/Kg.
WHAT TO EXPECT
In the short term we don’t see the possibility, especially in Europe, of meeting the demand for Sunflower Oil with other Seed Oils; we expect a growing request and price increase from the market for refined products.
If farmers in Ukraine will not be allowed to plant the Sunflower seeds in the coming months, future crops will most likely also be compromised. We believe that the shortage of Seed Oils, together with its consequences, could be a long-term phenomenon.
EXTRA VIRGIN OLIVE OIL AND OLIVE OIL
Historically Extra Virgin Olive Oil prices trend well above Refined Olive Oil prices, following the general price increase for oils and fats. For this reason, we expect the EVOO market to start trending up in the months to come.
A potential impact on the Olive Oil prices could come from the current drought situation in Spain, the most significant world provider for this category.
It will be crucial to observe the evolution of the next blooming season to have a better picture of how the next crop will evolve: in Spain, Italy and Portugal during May/June, in Greece, earlier in April.
In summary, we can say that future market fluctuations are hard to predict. We are facing an extreme situation between geopolitical conflicts on the one hand and challenging climate conditions on the other side, and both consequences are still fundamentally unknown.
Our sourcing team and cooperatives of farmers observe the situation’s evolution very closely at the source, and we will keep releasing market updates to help you make the best buying decisions.
Contact us if you are interested speaking with our experts and you want to stay ahead of the market with your Extra Virgin and Olive Oil food programs.