Crisis in the olive oil industry: the heat wave could increase prices

After the heat wave affected the flowering in Spain, which produces about half of the world’s olive crop, the harvest is forecast to rise just 28% over last year, making it the worst in almost one of each.

The International Olive Oil Council estimated that the country would produce 850,000 tons in a typical year. This number was only 660 thousand tons last year. This forecast was published before the current period of high temperatures.

The industry fears production could worsen as a second heatwave in a week brought temperatures as high as 43C in parts of southern Spain this week, causing trees to drop green fruit to conserve moisture.

“WE ARE VERY WORRIED”

Walter Zanre, chief executive of the British arm of olive oil producer Filippo Berio, said: “We already know it is going to be a bad year in Spain, but no one can cope with what is happening at the moment. Record temperatures will not help the situation.”

“I cannot share how concerned we are about this. Last year, Spain had some turnover compared to the previous year, which somewhat eliminated the deficit. This year the barrels are dry. Even if Spain produces the estimated 850,000 tons, the price situation is worse.” saying.

Zanre said the potential shortages meant prices were likely to rise further due to similarly weak harvests in Italy and Portugal. Wholesale prices have doubled since the start of 2022. According to the latest figures from the Office for National Statistics, the retail price of olive oil in the UK rose 47% year-on-year in May to an average of TL217 per 500ml.

The fall harvest is not expected to bring new crops until November. Considering that last year’s supply is also expected to run out in September, it is possible to see shortages in supermarkets in the fall at current consumption rates, he said.