Over the past two years, the unprecedented decline in olive production in the Mediterranean basin has caused oil prices to soar. Even if the next harvest promises to be better, it is unlikely that this will change the situation for consumers.
After two years of drought, prices of olive oil prices have reached an exorbitant level : more than 8 euros per kilo in bulk, for the reference price in Spain, the world’s leading exporter. This translates into extra virgin oils sold for between 10 and 15 euros per liter.
The latest production (2023/2024) has not brought any respite to the market: it could fall by another 100,000 tonnes, to reach 2.41 million tonnes, according to the data transmitted at this stage by the 37 member states of the International Olive Council. The figure will be confirmed this autumn, at the next meeting of IOC experts.
Minimal trade
These two painful years for the sector have reduced stocks to a historically low level. Even if the next harvest 2024/2025 were to rise and be announced not ” weak “, more ” average “As some are already predicting, there is little hope of returning to 2022 prices, according to Abdellatif Ghedira, the former head of the Organization. A fraction of the production will indeed have to replenish stocks, and will therefore not be put on the market.
This bad patch for the sector olive oilis reflected in commercial exchanges: they are minimal today, as evidenced by the various platforms of price indicators and volumes sold. The processors, who bottle the oil, have secured their purchases during the first three months of the year. Those who have not placed orders will have to wait until the fall.
Adaptation to climate change
At the first World Olive Oil Congress held in Madrid last week, the players in the sector discussed the increasingly complex scenarios they will have to face due to climate change, especially since the Mediterranean basin is a region that is warming 20% faster than average, according to the UN Intergovernmental Panel on Climate Change (IPCC).
Farmers are particularly banking on new irrigation models, such as drip systems, explains Abdellatif Ghedira, the former head of the International Olive Council. Some are migrating to more rainy regions, or choosing other varieties in areas with very low rainfall.
A culture that is increasingly attractive
The price developments of the last two years should only encourage small producing countries to expand their planted areas: this is the case in Saudi Arabia, Georgia, and China, where olive cultivation is consolidating, with, in some places, very good results in terms of quality.
Other countries have set themselves ambitious numerical targets: one million trees for Libya, 120 million for Egypt. But in the meantime, it is still Europe that provides 60% of production, and holds the key to prices.
