(Agence Ecofin) – Olive oil is one of the most expensive oilseeds on the world market. Users of this ingredient who have suffered from the drop in supply since 2022 expect an improvement in supply this season.
After two consecutive years of decline, global olive oil production will recover in 2024/2025. According to the latest report from the United States Department of Agriculture (USDA), production of liquid gold is indeed expected at 3.1 million tonnes during this campaign.
This would be a level up 27% compared to last year and a forecast slightly lower than that formulated by the International Olive Council (3.35 million tonnes). According to the American organization, the resumption of production will follow the good performance linked to the favorable year of the biennial alternation of olive trees among most suppliers.
In detail, the American organization underlines that the European Union (EU) should produce 2 million tonnes in 2024/2025 compared to 1.5 million tonnes a year earlier. In Spain, which contributes two thirds to this regional supply, the milder temperatures and the rains which fell during the summer and winter weighed on the improvement of the harvests.
Still in the Mediterranean region, Turkey should display 350,000 tonnes of olive oil compared to 190,000 tonnes a year earlier while in Tunisia, the authorities anticipate a supply of 340,000 tonnes in 2024/2025, an increase by 70% from one year to the next.
On the other hand, the sector will fare less well in Morocco with production almost stable at 110,000 tonnes, below the average of 167,000 tonnes recorded between 2017/2018 and 2021/2022 according to the USDA.
Tensions which should persist on prices
Although the 2024/2025 campaign should see an improvement in supply, the USDA is not drawing too hasty conclusions about a possible decline in prices. Indeed, according to the American organization, stocks at the start of the season remain low, exhausted by two years of drought and strong demand.
Consumption should increase by 17% over the said season to reach 2.8 million tonnes, which should put pressure on the market while exports should only increase by 5% to 1.2 million tonnes.
« The extent of the price reduction over the campaign will be conditioned by the reconstitution of global stocks which is expected below pre-2022/2023 levels.,” the USDA concludes.
As a reminder, according to data from the Ycharts platform, the prices of a ton of olive oil reached $10,281 last January and $10,067 in February. If since these two historic peaks, the fever has subsided, some analysts nevertheless predict an average price per tonne higher than $8,500 by the end of 2024 compared to $7,709 in 2023.
Espoir Olodo
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