Crisis of olive oil production in Europe

A dry and hot summer season in southern European countries for the second year in a row, this year’s unprecedented forest fires have led to a decline in olive and olive oil production. Meanwhile, EU countries produce about two-thirds (67 percent) of the world’s olive oil.

There are about 4 million hectares of olive groves in the European Mediterranean. Each year EU countries produce about 2 million tons of olive oil and 900,000 tons of table olives from here.

Spain ranks first in olive oil production among European countries. This country realizes more than half of the olive oil production in the EU during normal periods. Spain is followed by Italy, Greece and Portugal.

If 5 years ago the olive oil production in Spain was at 1 million 790 thousand tons, during the harvest period 2022/23 its production has decreased to about one third of this figure.

Olive oil production in Italy, which was 329,000 tons last year, fell 27 percent to 241,000 tons last year. Portugal’s production is also falling, down 39 percent to 126,000 tons in 2022.

Due to reduced supply and continued high demand, olive oil prices have started to rise rapidly in the last period and are breaking record after record. According to the IMF, the price of olive oil on world markets in May exceeded the last record set in 1996. The price increase continued beyond May.

According to Infa Oliva, which tracks prices in the sector, the cost of a liter of virgin olive oil, which was €1.86 in August 2020, reached €7.82 this month. Thus, the price of olive oil has more than quadrupled (420 percent) in the last 3 years.

The International Olive Council, which brings together olive-producing countries, forecasts that global consumption of olive oil will be 3 million 55 thousand tons and production will be 2 million 730 thousand tons in the 2022/23 agricultural year.

The difference between consumption and production will have to be closed from stocks.

Tags: EU, prices, Spain, Italy, Greece, Portugal, olive oil